Blog : Review of Marijuana Pure-Play Stocks

In terms of share price, all pure-play marijuana penny stocks are over-valued right now.  In terms of the business behind each, here are some thoughts.  This report was first produced to subscribers of Peter Leeds penny stocks in February.

 

WARNING!  There is currently a ton of hype surrounding these companies.  In other words, the shares are dramatically over-valued.  We suggest staying far away from any of them.

 

 

We were putting this information together for Newsweek, so decided to also share it with you.  This is not a suggestion to buy any of these dogs.  Rather, many have been asking, so we thought we would share the analysis with you.

 

 

 

 

CBIS - Cannabis Science (OTN)

Shares have increased in value by as much as 500% in a month, but they are bleeding cash ($16 million loss in most recent fiscal year).  Over that time, revenues were only $36,000.  Last quarter liabilities were almost 7 times as much as assets, and that ratio keeps getting worse.

GRNH - GreenGro (OTN)

Shares of this penny stock went from 5 cents to $1.20 since January 1st (and now sank back to 40 cents).  Bleeding cash of almost $100,000 each month.  Total assets of only $42,481, with total liabilities of four times that.  Market cap of the company hit $150 million at it's high, and even now sits at $54 million.

NVLX - Nuvilex (OTN)

Revenues of zero, loss last quarter of $5.6 million.  This is not a viable business model.

ERBB - Tranzbyte (OTN)

Last quarter revenues of $61,000, operating loss of $290,000.  Current assets of $63K, compared to current liabilities of $4,651,000.  Total assets of $4.5 million, total liabilities of $7 million.  The issue with the total assets is that they count $3.3 million under goodwill.  Goodwill is notorious line item for being misleading or outright made up.  They could have listed it as valued at $8 million, or $1 million.  It is a judgement call, and in this case almost certainly purposefully misleading IN MY OPINION.

CANV - CannaVest (OTC-BB)

Lost $28 million last quarter, on sales of only $163,000.  Their recent stock price rise (year low $4.50 to year high $49.90, currently at $35/share) gives them a market capitalization of $300 million and took them well out of penny stock territory.

TRTC - Terra Tech (OTC-BB)

Shares went from 7 cents to 45 cents in the last 6 weeks.  Lost $5.8 million last fiscal year, assets are about equal to liabilities.

HEMP - Hemp, Inc. (OTN)

Lost $16 million last year on revenue of $9,000.  Current assets of $18K, current liabilities of $690K are 38 times greater.  In my OPINION, they also mis-valued their "property, plant, and equipment" at over $2 million.

MJNA - Medical Marijuana (OTN)

Was used in a massive penny stock pump & dump scheme.  According to reported financials, had revenue of $604K last quarter, and would have had a loss of about $100K, if not for an $8 million non-operating income item on their financial report.  They seem to have strengthened their financial position.

FSPM - Fusion Pharma (OTN)

Spiked from 25 cents to $2.95 in the last month.  Net income of $210K last quarter.  Total assets of $677K, liabilities of $180K.  Market cap of $15 million is not justified.

EDXC - Endexx (OTN)

Revenues of zero.  Assets of $1.5 million reported, liabilities of $1.9 million.  Shares went from 5 cents to 19 cents within the last month, but still (and should) languish in penny stock territory.

MWIP - Mediswipe (OTN)

Shares spiked from 9 cents to 68 cents in the last month.  $47K in revenues last quarter, and a loss of $182K.  Total assets of $242K, liabilities of $598K.