Supreme Cannabis Company Inc. (The) T.FIRE

Updated Valuation Metrics

[johnale]

Considering the raise - there is an improved balance sheet and thus financial flexibility - that continues to warrent a higher valuaiton.  See prev post - ~6x  CY2021E EV/Sales
Supreme currently trades at 2.75x as of today. Avg in sector is 7.1X Canopy/cronos 18-21x 

Updated Net debt post 20mil raise  - 15mil cash + 35.7mil convertible debt. 

Updated outstanding shares - 610mil 
Fully diluted with warrents exercised - shares - 662.5mil  Net Debt - 3mil cash + 35.7mil converts  
CY2021E - 62 mil x6 = 372milEV - implied market cap 372- 3mil -35.7mil = 333.3 

Implied share price Fully Diluted - 333.3/662.5mil = .50 cents/share TODAY


So based on my last post which had implied upside to .54cents - we really only lost a small amount with the raise. If it helps increase growth and revenues, and justify a higher valuation - then it is justified.  

Being cashed up with a great Q2 would be nice....

still wish they kept it tight and used profits to pay debt. but well see what beena has in store.

[Method]

Lots of reasons to do a raise as has been alluded too and mostly positive. Obviously no one wants dilution on the equity side there are significant benefits: - Lower cost of capital (less bankruptcy risk means more institutional investors) and a lower discount rate means higher NPV - Access to more ETFs due to bigger market cap - Less pressure from BMO - Likely a lead order from an institution

[tongyboi]

all good points