Cansortium CNTMF Stock Forecast & Analysis

Cansortium, CNTMF stock is a cannabis stock that has already printed net earnings profitability over the past several quarters.  And, this is one of the reasons why I wanted to put together the CNTMF stock forecast.  However, despite net earnings profitability, EBITDA profitability on a per-revenue basis remains a bit elusive.  This tells me that continued profits will take more time until Cansortium is more consistent.  Still, this is a very strong position to be building upon.

All cannabis stocks appear to be stuck entirely in a range of sliding downward with a heavy weight sitting on top of any potential moves upward.  But, if you break down the individual stocks, many are just on the cusp of breaking out significantly.

Despite the lack of catalyst that might draw in enough investors to accumulate sizable positions, such as in CNTMF stock, there is still plenty of reason to be accumulating these stocks.  And, the fact that Cansortium has printed a few consecutive positive net earnings quarters, this means that CNTMF stock may have potential upside as the market will not ignore profits forever.

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Cansortium Financial Data

Here is a breakdown of Cansortium financial data from their latest quarter.

Cansortium Gross Profits

  • Cansortium Revenue

Over the past few quarters, Cansortium has printed higher and higher revenue.  But, gross margins are not improving along with that.  More economies of scale will be needed to get this metric moving higher.  And, with a potential economic contraction, this may affect revenue growth; I am not impervious to grasping that.

If, however, Cansortium can see continued revenue growth and simultaneously they can improve gross margins, this will go far to improving the bottom line; especially EBTIDA which lacks consistency.

Cansortium Operating Profits

  • Cansortium Operating Costs

Sitting just above 35%, operating efficiencies show that Cansortium management has not gone too far with costs until they can grow into the company.  Revenue will continue upward.  This will mean that operating efficiencies are likely to improve even more.

But, with revenue increases, I am wondering how Cansortium will do with the economy slowing as it is.  This is a key moment for our economy.  Still, Cansortium has printed ever-increasing revenue up to this point and I will continue forward with that line of thinking until they do so otherwise.

In the meantime, getting revenue to a point where operating costs are a mere 17.5% of revenue will be the next goal.  This is the next level.

Cansortium EBITDA & Net Profits

  • Cansortium EBITDA

It is just this last quarter that Cansortium dropped somewhat in profitability.  As revenue continued to increase I would have thought that Cansortium could have also followed through with more profitability.  But, one-off events pushed Cansortium into negative net earnings this quarter.

As long as this is not a trend, then the prospects for CNTMF are very strong.  If Cansortium can turn back around and print more net earnings positive results this will mean that they could continually add to cash on hand.  But, that is moving lower.

In the meantime, the lack of core EBITDA profitability calls into question continued profitability until Cansortium can print better numbers here.  There needs to be more economies of scale and increased revenue gains to get a better position on EBTIDA profitability, and then net earnings profitability.

Cansortium Cash On Hand

  • Cansortium Cash on Hand

I would have thought that cash on hand would follow a more coincidental pattern with profits, as shown just above.  Cash on hand is sliding lower over the past few quarters and yet, net earnings has been positive over the past few quarters, the latest quarter notwithstanding.

Whether or not there can be a return to net earnings positive will depend upon scaling up revenues and then improving margins accordingly.

Cansortium Total Equity

  • Cansortium Total Assets

I am always looking for continually increasing total equity.  Total equity, of course, is total assets less total liabilities.  As a company builds up assets, it takes on debts and has to also take on more and more debt for financing operations should they not be at net earnings positive yet.  This is the case for Cansortium.

While the above is far from dramatic, I will keep it in mind that total equity is declining.  And, considering the losses that Cansortium is taking every quarter, it may be that their cash burn will mean more and more debts.

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Cansortium CNTMF Stock Forecast

Cansortium CNTMF Stock DCF

I am reluctant to see how Cansortium can pull off the $90M in revenue for this year, but until analysts downgrade that number, I will stick to it.  Nonetheless, I balanced my thoughts of the potential that Cansortium may not hit the $90M mark this year with keeping other metrics softer.

I am also looking toward the far future with the increase in revenue over the next several years.  As Cansortium increases its presence, they will continually increase the ability to build a larger and larger customer base.  The increasing revenue in the face of many other cannabis stocks heading lower with revenue for Q1 tells me that there may be some potential here with the quality that is getting individuals to switch over to this brand on a continual basis.

I will update CNTMF stock forecast as more and more information comes available.  But, the recent profitability levels have me interested.

Is Cansortium CNTMF Stock A Good Investment?

Cansortium CNTMF Stock Chart 1Nov22

I believe that cannabis stocks will get there.  But, investing is a popularity contest and not many individuals know about cannabis stocks.  In the meantime, the lack of these stocks heading higher means that investors who are not actively trading are sitting on their shares and simply waiting.  Others are getting out of their holdings.  This is tending to push all cannabis stocks lower.  Short sellers are then entering and going short in large quantities which since the short sellers are pushing prices downward, this gets people to exit more; a vicious feedback loop.

This means that the short sellers are more in control.  And, without a catalyst, all cannabis stocks are doomed to slide lower and lower.

But, does that mean these stocks do not have value?  No, it merely means that these stocks do not have popularity.  The eventuality is that these stocks will gain in popularity.  And, this will mean that eventually these stocks will see moves higher.  Those that can see through this will see that just like many other cannabis stocks, Cansortium CNTMF stock has a lot of upside potential.  It is merely unrealized.

For those that can add into their positions continuously, and hold on for whatever timeframe it takes, the rewards with these stocks moving higher will far outweigh the alternatives to cannabis stocks.

Cansortium Financial Data

Cansortium CNTMF Stock Financial Data

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