The companies are all overvalued – full stop continued
This does not include the ancillary market or the transition from alcohol to cannabis nor natural industry growth. Nor does it factor in the edibles, beverages, international, or tourism markets that will come into existence in time. Those that use this argument are possibly using traditional measuring tools and that typically includes 12 month trailing revenues. Really? Looking in the rear-view at millions and not out the front window at billions could be the fast path to losing all credibility. But remember, until the adult recreational market is legal and in place – it is not. Just slide some of those assumptions upward … assume Canopy has more than 20% of the market, and the market is closer to the high end at $9B in year 1, etc …. Some could argue that Canopy and others are value priced.
This just may be a strategy for you – refer to our August 2017 issue’s second case study. For each of those companies listed, it has only been good news since. CMM is now part of ALEF as an aside. We will also revisit this as case study 3 this month.
Remember, we were there at the onset stating this industry must be viewed as a vibrant ecosystem but as with all ecosystem it will face challenges and set backs. We were the first to define events that dramatically
transform the industry as Ecoforming events (think of Terraforming). We have said the US itself will change its position in time, Hours before news broke that President Trump was backing off his position on cannabis, I had already written this for my article for the USA magazine:
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