November’s Top Marijuana Penny Stock Opportunities
As November unfolds, investors keen on navigating the volatile yet promising landscape of marijuana stocks find themselves at the intersection of opportunity and risk. With the US cannabis industry expanding at an unprecedented pace, driven by both legislative reforms and increasing consumer acceptance, the market is ripe for exploration. In addition, recent statistics indicate a robust trajectory, with the industry expected to reach new heights as more states embrace legalization and federal regulations evolve. Overall, the allure of marijuana penny stocks lies in their potential for rapid gains, making them attractive options for day trading enthusiasts seeking quick profits and swing traders looking to capitalize on short to medium-term market trends.
Navigating the dynamic world of marijuana penny stocks demands a strategic approach. In addition, successful traders employ technical analysis to decipher price patterns and identify entry and exit points. However, the inherent volatility of these stocks necessitates prudent risk management strategies to mitigate potential losses. Amid the speculative fervor, it becomes crucial for investors to strike a balance between capitalizing on market movements and safeguarding their investments through disciplined trading practices. As November unfolds, staying abreast of the latest developments in the US cannabis industry, combined with astute technical analysis and risk-conscious trading, will be paramount for those eyeing lucrative opportunities in the marijuana penny stock arena.
Top Penny Stocks in the Cannabis Sector for November
- Glass House Brands Inc. (OTC: GLASF)
- The Cannabist Company Holdings Inc. (OTC: CBSTF)
- Goodness Growth Holdings, Inc. (OTC: GDNSF)
Glass House Brands Inc.
One of the US’s fastest-growing vertically integrated cannabis companies, Glass House specializes in the California market and builds enduring, recognizable brands that appeal to customers of all ages. From the start, the company’s co-founders, Graham Farrar, a board member and president, and Kyle Kazan, the chairman and CEO, promoted respect for people, the environment, and the community. In general, the company’s efforts in greenhouse farming, production, brand promotion, and retailing are supported in this respect. In addition, Glass House is committed to achieving its mission of excellence: exceptional cannabis products produced sustainably for the benefit of everybody. Glass House is the parent company of Glass House Farms, PLUS Products, Allswell, Forbidden Flowers, and Mama Sue Wellness. The company will release its third quarter 2023 results on November 13th after the market close.
Second Quarter 2023 Highlights
(Unless otherwise stated, all results and dollar references are in U.S. dollars)
- Net Sales of $44.7 million increased 171% from $16.5 million in Q2 2022 and up 54% sequentially from $29.0 million in Q1 2023;
- Gross Profit was $24.4 million compared to $0.3 million in Q2 2022 and $12.0 million in Q1 2023;
- Gross Margin was 55%, compared to 2% in Q2 2022 and 41% in Q1 2023;
- Adjusted EBITDA1 was $9.5 million, compared to $(9.8) million in Q2 2022 and $(0.1) million in Q1 2023;
- Cost per Equivalent Dry Pound of Production3 was $139, a decrease of 12% compared to the same period last year and down 29% sequentially versus Q1 2023;
- Equivalent Dry Pound Production2 was 103,336 pounds, up 311% year-over-year and up 115% sequentially;
- The cash balance was $22.7 million at the quarter’s end, up 39% from the Q1 2023 quarter’s end.
Q2 2023 Outlook
Words From The CEO
“The second quarter of 2023 was the best in our history. We achieved record levels of operating cash flow, exceeded Q2 guidance across several operating metrics and marked our first quarter of positive adjusted EBITDA1.”
“In Q2 2023, we saw our biomass revenues and pounds sold more than quadruple versus the previous year. Revenues from our retail dispensaries doubled to $10 million year-over-year, due to growth from acquisitions. Consolidated gross margin surpassed 50% and cultivation cost per pound3 fell by 12% versus last year. Finally, Adjusted EBITDA1 flipped to a positive $9.5 million compared to negative $9.8 million a year ago.”
Kyle Kazan, Co-Founder, Chairman and CEO of Glass House.
GLASF Stock Performance
GLASF stock ended at $4.38 on November 9th, down 0.45% in the last month of trading. In this case, the stock has been trading in a 52-week range of $1.78-$5.10. GLASF stock is up 129.32% year to date.
The Cannabist Company Holdings Inc.
With licenses in 16 U.S. states, The Cannabist Company—formerly Columbia Care—is one of the biggest and most seasoned producers, makers, and suppliers of cannabis products and associated services. The company runs 125 locations, including 31 manufacturing and growing facilities, some still under construction, and 94 dispensaries. One of the first multi-state cannabis providers in the United States, Columbia Care, is now known as The Cannabist Company. It offers market-leading goods and services for both medical and adult usage. The company introduced
Cannabist, its retail brand, in 2021 and used proprietary technological tools to build a nationwide network of dispensaries. The company offers products spanning flower, edibles, oils, and tablets and manufactures popular brands, including Seed & Strain, Triple Seven, Hedy, gLeaf, Classix, Press, and Amber. The Cannabist company will report its financial results for the third quarter ended September 30, 2023, before U.S. financial markets open on Tuesday, November 14, 2023.
Words from The CEO
“Our second quarter results were solid, as we achieved more than $129 million in revenue, representing 4% sequential growth, confirming that we have kept our foot on the accelerator over the past 16 months. The financial impact of the measures we have taken to optimize our outstanding footprint and right-size operations are leading to increased profitability, with an 11% increase in gross profit over the first quarter and Adjusted EBITDA1 increasing 24% sequentially to over $20 million. We continue to focus on generating positive cash flow. Growing markets on the east coast fueled our sequential topline growth, counterbalancing further price compression in certain markets such as Florida, Illinois, and Massachusetts. We continued to reduce costs in the quarter, having now eliminated over $38 million, net, in annual expense, as we prioritize cash flow generation. We have announced the initial steps to manage our balance sheet in collaboration with our bondholders and are actively reviewing and considering additional refinancing alternatives. To enhance liquidity and improve operating efficiency, we have continued divesting non-core assets and pursuing commercial mortgages on eligible properties. Our decision to prioritize markets that are driving profitability and growth, and continue our commitment to the diversification of our revenue base, was reflected by continued store openings in Virginia, the launch of adult-use sales in our fully integrated Maryland market on July 1, targeted retail expansion in New Jersey, and the launch of enhanced manufacturing and cultivation capabilities in Ohio, Colorado, West Virginia and New York.”
Nicholas Vita, CEO of Columbia Care.
CBSTF Stock Performance
CBSTF stock closed on November 9th at $0.3710, down 55.30% in the last month of trading. In this case, the stock has a 52-week range of $0.27-$2.06, down 50.53% year to date.
Goodness Growth Holdings, Inc.
American-based Goodness Growth Holdings, Inc. is a medical cannabis business. In general, the company grows marijuana in eco-friendly greenhouses and makes pharmaceutical-grade cannabis extracts. It sells its products through a network of independent retail stores operating under Goodness Growth and other brands. Eight dispensaries were located in Minnesota, four in New Mexico, four in New York, and two in Maryland as of March 11, 2022. It also provided wholesale cannabis products to several Arizona, Minnesota, New York, and Maryland businesses. In June 2021, the company’s name was changed from Vireo Health International Inc. to Goodness Growth Holdings, Inc. The corporate office of Goodness Growth Holdings, Inc. is located in Minneapolis, Minnesota.
Second Quarter 2023 Highlights
- In June 2023, GAAP revenue reached $20.2 million, reflecting a 4.2% decrease from June 2022.
- Over the six months ending in June 2023, GAAP revenue amounted to $39.3 million, marking a 7.0% increase from the same period in 2022.
Revenue (excluding discontinued operations):
- For June 2023, revenue, excluding discontinued operations, was $19.2 million, indicating a 10.6% increase from June 2022.
- Over the six months ending in June 2023, this figure amounted to $37.3 million, reflecting a substantial 19.8% growth compared to the same period in 2022.
GAAP Gross Profit:
- The GAAP gross profit for June 2023 was $9.3 million, representing a 10.0% decline from June 2022.
- Over the six months ending in June 2023, the gross profit reached $18.9 million, showing a remarkable 46.6% increase from the same period in 2022.
Gross Profit Margin:
- The gross profit margin stood at 46.2% in June 2023, exhibiting a decrease of 300 basis points (bps) from June 2022.
- For the six months ending in June 2023, the gross profit margin was 48.0%, marking an impressive increase of 1,300 bps from the same period in 2022.
Operating Income (Loss):
- In June 2023, the company reported an operating loss of ($1.0) million, which was a significant drop of 438.1% from the operating income of $0.3 million in June 2022.
- Over the six months ending in June 2023, the operating loss amounted to ($0.7) million, compared to a loss of ($7.5) million in the same period in 2022 (not meaningful or “NM” improvement).
- In June 2023, EBITDA reached $2.8 million, reflecting an impressive 156.5% increase from June 2022.
- Over the six months ending in June 2023, EBITDA amounted to $4.3 million, marking a substantial improvement from a negative EBITDA of ($9.6) million in the same period in 2022 (NM improvement).
- The EBITDA margin stood at 14.1% in June 2023, exhibiting an 880 bps increase from June 2022.
- Over the six months ending in June 2023, the EBITDA margin was 10.9%, showing a significant improvement of 3,700 bps from the same period in 2022.
These detailed financial metrics offer a comprehensive view of the company’s performance, highlighting changes in revenue, profit margins, expenses, and operating income for the stated periods.
GDSNF Stock Performance
On November 9th, GDNSF stock closed at $0.1568, up 5.56% in the last trading month. In this case, the stock is trading in a 52-week price range of $0.091-$0.4250 and is down 2% year to date.
November’s Most Promising Marijuana Penny Stocks
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