RE:Accumulate purse, agreed! I'd been on the sidelines monitoring the company on and off for years despite a few moderately successful trades. But this cc led me to accumulate a far larger position for the longer term and I will probably add more if that gap fills at .91 this coming week.
I suspect the growing pains that have hampered the company's potential may mostly be in the rear view.
A few of the things I'm keying off from their latest call leading me to buy:
1) They appear to be smartly offsetting some of the ongoing B2C challenges for Nutradried with B2B and co-manufacturing opportunities which is improving margins for that segment and helps smooth out the revenues over time. With only 4 B2B customers the runway for expansion is long. Successes in the retail channels will only help to bolster B2B successes and they appear to have learned many hard lessons over the peaks and valleys this segment has gone through. The operation sounds far more lean and flexible but with a multi-tiered approach so going forward they hopefully won't live or die by Costco. Early days with the new ceo but everything I heard sounds quite promising.
2) It really sounds like all the promise of the cannabis segment may finally begin to come to fruition in this next FY. The US market is absolutely ideal for this especially with the compelling data the company has proven out as a key differentiator and selling point. The CAD producers completely failed to utilize this technology so let's hope the opposite occurs in the US where sales are booming and this technology could be utilized at scale. Based on my notes a 120k machine utilized 8 hours a day could generate $400k in royalties per year so with one in place in IL and possibly several more coming online in FY 22 the royalty profile may begin to markedly improve and help to increase the REV side margin profile further . I really like Brents confidence wrt cannabis suggesting 40% of sales will come from cannabis in 22.
3) A FY 22 forecast of 10 large (double FY 21) and 15 small scale machine potential sales in the pipeline, Very significant potential for some big partnerships to meaningfully evolve and grow (Dole, US Army, big pharma, and the mystery co-mfg company Brent alluded to...not to mention some potentially very large cannabis partners being brought in).
4) Plenty of cash on hand. A plan to get the word out on the investment value proposition here and an NCIB backup plan to retire cheap shares and back stop a continued price slide which ishould be supportive for current buyers as these prices.
That's my take.