Post by
mrmomo on Jul 08, 2022 7:50am
Reply to Ronbromleygross
Ronbromleygross wrote:
Thanks for your response insightful post mrmomo. I see your comments on several boards and respect you and your thoughts very much. I agree with pretty much most of your comments and analysis mrmomo. Refreshing to get some good, fair, reasonable and objective comments here.
Hello again Mr. Ronbromleygross, always a pleasure to discuss investments with you. And as always, if my opinions & views help you or others in some way by giving you guys a different perspective, then mission accomplished as far as i'm concerned. Thanks again for the kind words and the feeling is mutual my friend.
"Hiti being a "retailer" has not fully distinguished itself in the MJ space and is looped in with the LP/Producer side. That is like throwing the baby out with the bath water in these difficult times."
Yep, that's EXACTLY what's taking place unfortunately and it will take time for the institutional investment, venture money or "Hot" money to come back to this space and for HighT to set itself apart from the others. By my estimations, at least one more year, maybe two depending on a few factors.
"I sure wouldn't touch any other company in this space and especially NOT Canopy or ACB or several others. Those companies are bleeding cash and many in this space will NOT survive much less grow or prosper. Many in this space are doomed and on life support right now. Not Hiti."
I agree completely....except. Out of those you mention, there will be some survivors. HighT will definitely be one (unless they screw up in some way), Canopy is in deep trouble with their heavy debt load BUT have solid backing, size & brand recognition to get them through this consolidation phase IF they make the necessary adjustments in time. Aurora is in better financial shape but lacks sales & market share, they ill need to merge with someone to survive though this. But aside from HighT, i like Cronos the best out of all of them with the best chances to come out in one full piece. If Aurora is smart, they would merge with Cronos as they're the best fit. The merged entity will give both Tilray & Canopy a run for their money for sure. There a few more heavy hitters which are also in decent shape to make it through.
"We are seeing many companies fold and more to come during this consolidation phase. This is where a company like Hiti will continue to build its platform. The NDF should happen sometime this month. ($30m I believe). Expect more "smart and opportunistic" M&A action from Raj. I am expecting a German acquisition coming up. Pick your targets now while the competition is on life support and wait for the rebound in this sector to come. Hiti can wait it out. No danger here. agree too that Hiti will be a prime takeover target at some point. A USA MSO imo would be the likely acquirer. Like Raj said "Hiti is available at the right price"
As i've indicated, we're still in the latter stages of Phase 2 of the consolidation process which has been going on for about two years but going at a snails pace because of certain factors. Phase 2 should be complete by late this year or early 2023. Once we enter Phase 3 or the final consolidation process, the strongest ones will start to emerge. And HightT should be right there among the best, if they don't F up. I use to like both HighT & Valens in thr retailt space, but it seems the latter has run into problems over the last year and might not make it. It will be interesting to see where Valens goes from here and HighT would be wise to follow their progress maybe even see if any assets of Valens are a good fit with them, just in case 8).
Remember what Raj said. "we do not need USA legalization to grow and build our company".
Both you & Raj COULD be right BUT it definitetly would help the industry if it did indeed happen sometime soon. Of which i just don't see happeing anytime btw, probably not this year but maybe 2023. And it's no secret the sector needs some much needed help to stop the bleeding and give it a boost. That would do it.
GLTA