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Welcome to the Cannabis Investing Newsletter Forum. Feel free to find your favorite cannabis stocks and contribute content as you please; content that continues the discussion of and analysis of cannabis stocks. – D. H. Taylor

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susna55555
(@susna55555)
Active Member
Joined: 4 weeks ago
Posts: 6
Topic starter  

Gross margin 35% (it seems doesn't get higher as revenue grows).

Shares outstanding:

51,211 (today)
44,985  (4/29/2021)
31,815 (1/30/2021)
16,006 (10/30/2020)
 
It seems we need more than 300% revenue growth to stay flat.
 
Its way overvalued in my opinion compared to MRMD, SHWAB, HOLISTER BIOSCIENCES or IONIC BRANDS

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D. H. Taylor
(@cannabisinvestingnewsletter)
Member Admin
Joined: 1 year ago
Posts: 260
 

You would probably need a little less than 300%; The reason is marginal costs and marginal profits. 

If a company attains EBTIDA break-even then their current costs are all covered by the current revenue.  Then, add in one more unit of production and the only thing that it costs are unit costs of production versus the rent on the facility/dispensary.  This next unit of production has an outsized profit margin compared to the previous units because of the fact that all of the major costs are already covered.

Given that, don’t look at revenue growth versus profits in a linear manner.  It is progressively higher and higher for margin contribution.  But, there are limitations; it does not go upwards forever.  


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susna55555
(@susna55555)
Active Member
Joined: 4 weeks ago
Posts: 6
Topic starter  

@cannabisinvestingnewsletter I don't like the way Hight tide Adjusts EBITDA.  Real EBITDA is negative for High Tide.

This post was modified 4 weeks ago 2 times by susna55555

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