Namaste Technologies An Attractively Valued Growth Story
At current levels, Namaste appears to be trading at a discount to its peers and is trading at 2x current assets. We find the valuation to be compelling and are favorable on the risk-reward profile that is associated with the platform. We believe the planned expansion into the USA market represents a major potential catalyst for growth and are bullish on this aspect of the story.
Although it is challenging to value a cannabis company like a food, technology or clothing business, the liquidity metrics (current ratio and cash flow) that are commonly used for these types of businesses can be applied to Namaste. When analyzing Namaste with these metrics, we determined that it looks like an undervalued opportunity and find the risk-reward profile to be attractive. Namaste is led by a management team that has a strong financial position to execute with no debt which we believe is an important aspect of the story.
During the last month, Namaste has been performing well and has come substantially off its recent lows. Momentum has been trending to the upside and we believe that this is a story that is just getting started. Namaste has visible growth prospects and this is an opportunity that should be on your radar.