CLSH CLS Holdings USA Inc

CLS Holdings (CLSH) Record Q1 Results - $1.15 Price Target by Canaccord

 

CLS Holdings (OTCQB: CLSH) just announced record sales of $2.9 million, and record gross profit of $1.4 million for fiscal Q1 2020

 

Price target of $1.15 per share by Canaccord Genuity,

 

Acquisition Target In Good Health receives Massachusetts State Approval for Final Recreation License

 

This could be the biggest play in the Cannabis space in years.  See the full story on http://www.EmergingGrowth.com

 

 

CLSH may not be at these levels much longer.

 

See the Press Release and more on CLS Holdings, Inc. (OTCQB: CLSH) at EmergingGrowth.com

https://emerginggrowth.com/stock-report/?code=clsh

 

 

CLS Holdings (OTCQB: CLSH) (CLSH.CN) is a best of breed stock that combines all of the best attributes of cannabis stocks into one company. 

 

CLS Holdings (OTCQB: CLSH) just announced record sales of $2.9 million, and record gross profit of $1.4 million for fiscal Q1 2020 – An increase of $1.2 million or 72.7% over fiscal Q1 2019

 

See the full press release here.

 

Highlights from the Fiscal Q1 2020 Results PR:

 

• Record consolidated revenue of $2.9 million compared to $1.7 million in fiscal Q1 2019, an increase of $1.2 million or 72.7%.
•  Record consolidated gross profit of $1.4 million, a 147.7% increase over the same period a year earlier.
• Record consolidated gross profit margin of 50.6% compared to 35.3% in fiscal Q1 2019.
• Consolidated net loss of $1.4 million or $0.01 per share compared to a net loss of $16.7 million or $0.23 per share in fiscal Q1 2019.
• Cash and cash equivalents of $5.9 million as of August 31, 2019.
• Record revenue from the Company's Oasis Cannabis dispensary of $2.1 million, a 96.6% increase over fiscal Q1 2019 revenue of $1.1 million.
•  Record Oasis Cannabis gross profit margin of 48.3% compared to 35.9% in fiscal Q1 2019.
• A 98.4% increase in dispensary customers, from 26,438 (294 average per day) in fiscal Q1 2019 to a record 52,448 (583 average per day) in fiscal Q1 2020.
• Record revenue per SF of $397 compared to $205 per SF during the same period a year earlier, an increase of 93.6%.
•  Record revenue from the Company's City Trees' branded products division of $0.8 million compared to $0.6 million in fiscal Q1 2019, an increase of $0.2 million or 33.6%.
• Record City Trees branded products gross profit margin of 56.2% compared to 34.1% in fiscal Q1 2019.

 

CLS Holdings (OTCQB: CLSH) also just received a C $1.50 – USD $1.15price target from Canaccord Genuity. See their full report here.

 

CLS Holdings (OTCQB: CLSH) just announced that In Good Health, a licensed medical dispensary, which the Company has the exclusive right to acquire in January 2020, was granted a final license for recreational use at its current location in Brockton, MA.

 

In Good Health operates a large medical cannabis dispensary business consisting of over 25,000 registered patients, delivery to 2,800 patients per month and maintains an 18,000 square foot grow with capacity to produce 9,000 pounds of finished flower per year. At today's retail price of $7,000 per pound this fully built out operation is capable of generating $60 million in annual revenue and gross profit of $ 35 million. 

 

• $50 million acquisition which should throw off $20 million in EBITDA the first year.
• Cash and cash equivalents of $5.9 million as of August 31, 2019.
• Strong medical and retail marijuana franchise in both Massachusetts and Nevada.
• With the advent of recreational sales in in Massachusetts they are at an inflection point where sales growth is going to compound higher. 

See the full report on CLS Holdings USA, Inc. on EmergingGrowth.com here.

See more news on CLS Holdings USA, Inc. on EmergingGrowth.com here.

 

CLSH's management team has also fully aggregated one acquisition know as Oasis Cannabis.  This is one of the top dispensaries n Las Vegas and one glance at the interior retail space will tell the story with its clean professional look. 

 

They also have a decent balance sheet with $10 million in the bank at FYE 19 and the past quarterly reports have showed a positive trend that looks like they are turning the corner to profitability.  They also have plans to grow their operations capacity and have a retail brand known as City Trees which is a specially formulated THC distillate used in vape products, tinctures, and caplets.  This product is gaining traction in the market and is distributed in 47 dispensaries.  They are vertically integrated and in every way a seed to shelf company.  This means there are so many chances for cross promotion, which eventually finds its way to the bottom line.    

 

Many still see huge opportunity in cannabis but the industry itself has gone through a massive correction in its price to sales multiples in just the past 6 months.  This means investors are not as ready to pay for sales as they once were.  Leading in the contraction are the top players like Canopy Growth (NYSE: CGC), Tilray, Inc. (NASDAQ: TLRY), and CuraLeaf (OTC Pink: CURLF) which nearly halved their multiples.  The biggest standout was Cronos Group, Inc. (NASDAQ: CRON) which went from 255 down to 19.  This multiple contraction means that investors will need to see increasing revenue growth quarter over quarter to sustain the stock prices of these companies.

 

Summary

The cannabis sector clearly looks like it has put in a double bottom on a technical basis so now could be an opportune time to step into the sector and buy value.  The next stage of growth could very well be mergers and acquisitions, but it's unlikely that the top brands backed by conglomerates will be creating mega brands.  Those businesses like Tilray, Inc. (NASDAQ: TLRY), Cronos Group, Inc. (NASDAQ: CRON), and Canopy Growth (NYSE: CGC) will start to work when these large brands start selling and launching CBD or THC infused products.  Mergers an acquisition plays could also begin to happen in the space and represent big upside for investors. 

 

The sweet spot in the sectors seems to be a company that can successfully complete acquisitions at fantastic valuations while increasing their revenues and profitability all at once. CLS Holdings USA, Inc. (OTCQB: CLSH) is a best of breed stock with all the characteristics an investor is looking for including a great price.  By all metrics the stock seems extremely undervalued and ready to run.  After the acquisition in 2020 revenues are expected to be $50 million.

 

 

 

CLSH may not be at these levels much longer.

 

See the Press Release and more on CLS Holdings, Inc. (OTCQB: CLSH) at EmergingGrowth.com

https://emerginggrowth.com/stock-report/?code=clsh

 

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