RE:RE:RE:Glimmers of hope 2019 into 2020I think your logic is sound for a certain majority of the sector - but your bearish sentiment is severely misplaced with FIRE. ... let me tell you why -
firstly - those companies who are not well capitalized will struggle and may go bankrupt. reducing the competition(noise) to an extent
Supreme is extremely well capatilized for the forseable fututre.
secondly - its is well documented that quality flower will dominate the market. (regardless of 'packaging' and branding) Consumers will not tolerate a poor product and will go to the black market.
Supreme has arguably one of the best products - with the best online reviews. They consistently sell out their flower - and recent launch of Jack Haze and its sell through is a great example of this.
no one can match what supreme can produce at that scale.
thirdly - the market in general is in its INFANCY -
look at colorado's annual sales since legalization -
683mil - 995mil - 1.3 bil, 1.507bil, 1.54bil
legalization - adobption - and an eventual turn to the legal market. that is significant yr over yr growth in sales. The well capitalized and better producing LP's will capatilize on this.
supreme is one of those companies.
fourthly - the retail rollout is on-going and with 2.0 products your looking at a market which will double in size (as well as LP's revenues correspondingly) (deloite report)
As provinces move to private models - with a rollout of more stores - this will allow the better LP's to sell thier brand in store by getting into the heads of the budtenders and marketing their product.
Supreme does an excellent job of this -
fifth - global legalization will continue - there is a strong push for countries around the word to legalize and (to some extent) Canadian LP's will be able to capatilize on this. this will only continue to re-ignite positive sentiment. even if that just means a large well run US/global company gobbles up some profitable canadian LP's.
sixth - Its not just about the next quarter - although fire wont have another bad one.
If you follow at all you would see that their products are in every province for the first time - because they didnt have the supply or packaging ability (nothing related to sell through) . Plus they held back all their trim for pre-rolls and oils for coming q's, as the wholesale market collapsed.
I have it from the company that provinces are asking for all pre-rolls they can produce.
revenues will continue to rise and be significant to the point where the market will see supreme as a winner.
If I were to have anything negative to say - it would be the insider holdings. they are low - less than 1%.
Im waiting to see (especially with new directors/upper management) - that they start loading the truck at these very low levels.
Other than that - there is lots to be very positive about at these bargain basement prices......