Village Farms International Inc VFF

Assessment

[retiredcf]

EPS of ($0.01) beat expectations of ($0.04) and revenues of $77.21M beat estimates of $71.59M. Sales grew by 18% year-over-year in its Canadian cannabis business, and it attained a top-three national market share position and took the lead in Quebec's market share. In the US it demonstrated sequential revenue growth, and positive cash flow. VFF is a $104M company with decent top-line growth expectations but it has not been immune to the troubles of the cannabis sector lately, and growth has been slowing. It has had a painful decline from ~$19 in 2021 to ~$1 today, and while the recent bounce and results are encouraging, we would not consider one quarter to make a trend, and we would need to see sustained improved results before becoming more comfortable with this name. If the company can continue to take market share, expand its profit margins, and achieve profitability, then we would re-consider taking a closer look at the name. (5iResearch)