Vibe Growth Corp C.VIBE

Looking Forward

[raptor0]

Hello, not sure who is monitoring this page these days, but I'm interested if there is anyone willing or interested in proving their perspective on the future of this company. I've been reading posts on Stockhouse for years, but haven't provided any input until now. I guess you have to start somewhere.

Full disclosure, I'm a former CONVALO-BLVD-VCAN holdout who is too embarrassed to admit just how much I lost following that company down the toilet.

My first impression of VIBE is that it seems to be a company that is successfully pulling off what VCAN had hoped to achieve. Though I'm not happy with the terms of the VIBE deal, it appears that our resources are now in better hands. I guess it's better than watching all the cash burned away to nothing.

I think the VIBE share price was likely artificially inflated to give them better terms on the deal, though a lack of any pullback at this point has been a welcome surprise as I fully thought it would tank. In fact, it seems like the company is doing a good job at growth in this space, though this is what I thought about VCAN too...

I did some rough calculations to gather an estimate fair market price for Q4 for this thing and I'd appreciate people's thoughts.

Q2 reporting provided a Net Profit margin of about 8%, so I'll use this for forcasting, though they can probably improve it.

I figure that by Q4 reporting, there will be about 81.78m shares of VIBE outstanding, which includes all the converted VCAN shares (no warrants considered).

I'll go with VCAN reporting of $1.7m in annual sales ($425k/quarter) for cannabis assets that will be added to VIBE operations. Taken with VIBE's recent news release of $7.25m revenue for Q3, let's say a run-rate for VIBE of $30.7m ({$425k + $7.25m} x 4) and net profit of $2.456m by Q4. This assumes no additional organic growth from their existing operations and no profit margin increase. That's $0.03 EPS on an annual run-rate basis.

Right now, I think the market's giving us a multiple of about 21x (pre-share dilution, pre-addition of VCAN incomes but in consideration of announced Q3 expectations). That multiple gives us a potential target price of $0.63 based on the $0.03 EPS - right where we are now.

My conclusion is that the share dilution directly cancels any gain by VCAN assets. I think I'm being generous in assuming that VIBE will directly translate all VCAN incomes from cannabis assets without a drop during transition (buy hey, maybe they won't).

None of this takes in account any upcoming additional dispensary openings, increased efficiencies by VIBE (for existing stores and VCAN assets).

Anyone have any thoughts about this? Did I mess up? I'd welcome any critques or corrections, as I will admit that I'm no pro at this stuff. I might be mistaken in applying a tradditional value analysis to a spec stock, but I'm just happy to actually hold something that has cash INCREASING each quarter!

Thanks.

[TheProphetElijah]

Without running complicated numbers the catalyst here will be legalization of weed stateside, then the big winners in cannabis 2.0 will be those with a proven model and ability to expand.  I think we got both here. Then keep in mind the float is more like 40 million since insiders own half the float: https://apps.cnbc.com/view.asp?country=US&uid=stocks/ownership&symbol=VIBE-L&

[raptor0]

I totally agree, though I hate to remain at the mercy of what might happen politically. Even without a federal legalization in the US, this thing is still making money and expanding. It seems like a hidden gem. Anyone have any insight on the management? The recent hire seems very positive, though I have questions about the rest.

[TheProphetElijah]

Well they're doing $7m revenue on $15m in assets - that green crack must be something else: