Auxly Cannabis Group Inc T.XLY

XLY fully funded capacity of 160,000 kg

[Kevelle]

Summary

Auxly Cannabis is a vertically integrated cannabis company. The company expects to have fully funded capacity of 160,000 kg by 2021.

With an asset/liability ratio of 3.7x, the company’s financial stability is quite strong. The company reports CAD 236 million in cash with long-term investments worth CAD 51 million.

From December 2017 to September 2018, the company reported an asset growth of 118% and cash growth of 615%.

Unlike many companies trading in the OTC Markets, CBWTF reports large float, which should be appreciated. The float represents 83% of the total amount of shares outstanding.

The company seems to be interesting for very long-term investors looking to wait until 2021 when the targeted production should be reached.

Expecting to have production capacity of 160,000 kg, with CAD 236 million in cash and only an enterprise value of $202 million, Auxly Cannabis (OTCQX:CBWTF) seems undervalued. Comparing the enterprise value and the expected production capacity of larger competitors, CBWTF should have larger enterprise value. Market participants should be expecting the enterprise value to increase quite a bit as the production capacity increases and revenues commence to flow.