RE:RE:RE:RE:RE:RE:RE:RE:Poor top and bottom-line with low and shirking margins. Copied from Yahoo Financials:
"You have made it painfully obvious you value technical analysis over fundamentals. The entire market is having a correction...Valens is not going out of business.
If any investor has a 6 month + time horizon this drop literally doesn't matter.
I like how Valens is positioned and believe management has done a good job ignoring shortsighted investors like yourself while executing in the background.
If the cannabis industry has taught me anything - Patience is necessary. People overestimate what can be done in 1 year and underestimate what can be done in 5 years.
You cannot judge Canadian LPs by US revenue growth numbers because of:
- Regulations against advertising
- No limits on production licenses
- Regulations on THC and volume caps
This is the back half of inning one and management has grown their capacity with intention and minimal dilution in an accretive manner.
We already have a CPG contract with Loblaws for Nuance. I think its safe to say more will come as the industry matures. Coke / Pepsi / Nestle don't care about getting in cannabis right away. They care about getting it right. Day to day / week to week / month to month stock fluctuations do not matter to anyone in that potential customer base.
Valens has an IP strategy with SORSE, has begun building out brands like Verse / Nuance, and will be uniquely positioned to capitalize on changing CBD OTC rules in Canada. This time next year you'll be seeing Nuance CBD bath bombs when you go into Shoppers / Superstore...
If any party attempts a hostile takeover at these levels the share price will only increase in value as they try to accumulate.
Don't be a short sighted amateur who gets worried at the first sign of "trend changes"
The only trend change that matters is Canadian companies who are sophisticated and can execute in an extremely competitive market will rise to the top of this ever expanding Global industry and TAM."
PUNJABI wrote: No, I did not listen to the conference call. I just looked at the key financials. While the stock market is forward-looking, the financials show the past but they still show the trend and the true financial health of the company which is crucial information on which one can form an opinion. If you look at financials close enough you can find the red flags and the potential risks and challenges
This company had serious issues with revenue and margin decline. They have solved the revenue issue by buying revenues. their annual revenues will cross $100 m. That comes with a price. Some medium and most large companies in the sector are taking this shortcut approach to increase revenues and market share. . Nothing creative or special about it.
About two quarters ago the company took a charge of $10 m and sold the inventory at a loss because they claimed that they could buy it cheaper and improve the margins. So far no improvement in margins has taken place. Managements make claims and then give excuses why the objectives weren't achieved.
Conference calls can be informative but some are full of management spins. For this company, I want to see margin improvement. and COST CUTTING. Based on the current margins and new acquisitions the burn rate in the next quarter will further increase. Don't see this company turning a profit soon.
I have no problem with others finding holes and calling me out on my views. The future is unknown and no one really knows what will actually happen. There are too many factors and unknowns. Because I identify the potential shortcoming some on the boards do not want me to post. Most stocks have shortcomings, it is prudent to know about them and be better informed instead of blindly believing in a totally rosy outcome. People who create hype and pump and disregard the challenges usually are not challenged and this board is full of them.