A strategic merger with 4Front coming on the heels of Pure Ratios holding acquisition affirms why Cannex Capital Holdings Inc (OTCMKTS: CNXXF) prospects can only get better despite the recent price slump. The transformational events expand the Company’s operations into six U.S states signaling push for market value in the burgeoning cannabis sector.
Cannex Price Analysis
While Cannex has taken a significant hit in the market, it is still up for the year after an excellent start that saw it rally by more than 200%. The stock has since pulled lower in what appears to be a correction phase.
The ongoing pullback has since exposed the stock to a crucial support at the $1 a share level. A breach of the support level would leave the stock susceptible to further drops probably back to the $0.80 mark, a critical technical level.
For the stock to resume its uptrend, it first needs to rise and stabilize above the $1.20 mark, the immediate resistance level. The stock rallying and finding support above the $1.2 mark would open the door for bulls to fuel a rally back to 52-week highs.
Cannex is a diversified company that leases real estate properties and sells supplies to cannabis cultivators. The Company also offers financial services as well as branding and IP services to licensed cannabis operators. It is also focused on premium indoor cultivation extraction and branding of edible and derivative products.
The stock edging lower after a stellar start to the year comes at a time when Cannex is in the process of merging with 4Front, following the signing of a definitive agreement. The Company’s shareholders have already approved the merger that will result in a combined company its operations in six states in the U.S
An alliance between the two companies is to result in a combined company with a share management philosophy of driving best practices throughout cannabis operations.
“Since our original formation, Cannex has been strategically focused on building vertically integrated operations in multiple states and, upon closing the business combination with 4Front, we expect to become one of the largest multi-state operators in North America with room for continued growth,” said Anthony Dutton, CEO of Cannex.
4Front Strategic Acquisitions
The merger comes high on the heels of 4Front completing two major acquisitions, set to expand the combined Company’s operations into Massachusetts and Arizona. Healthy Pharms, which boasts of two dispensaries in Georgetown and Harvard square, is one of the entities that the Company has acquired.
With the acquisition, the Combined Company will gain access to a large cannabis production facility in Georgetown that will act as a processing hub. Green Goddess is the other company that 4Front has acquired that boasts of licenses for operating a cannabis production facility in Arizona.
The two acquisitions will provide the combined company an immediate platform for ramping up growth in Massachusetts recreational market.
The mergers come high on the heels of Cannex inking a deal to acquire a 100% stake in San Diego-based Pure Ratios Holding. With the acquisition, the company stands to strengthen its positioning in the CBD and cannabis wellness category.
Pure Ratios Holdings joins the Company with vast expertise when it comes to integrating CBD into a variety of form factors including a 96-hour transdermal patch. The integration of the Company into a combined company of Cannex and 4front should go a long way in accelerating growth given its exposure to the burgeoning California cannabis market.
“The Pure Ratios product line is broad and well developed, which will only improve with additional support from Cannex. As we look at potential acquisitions, Pure Ratios instantly struck us as a unique opportunity with a core and complementary product focus,” said Anthony Dutton, Cannex CEO.
While Cannex has taken a significant hit, the pullback could pave the way for further rallies. A merger with 4Front is a significant development poised to strengthen the Company’s long-term prospects as well as growth metrics in the cannabis sector.
The two companies have already completed strategic acquisitions that enhance the push for market value in the multi-billion-dollar sector. The pullback finding support above the $0.80 mark should make it an ideal pullback play as the pursuit for market share in the sector heats up.
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Disclosure: We have no position in CNXXF and have not been compensated for this article.
Terra Tech Corp (OTCMKTS: TRTC) A Bounce Back Play As Net Loss Narrows And Gross Margins Expand
Terra Tech Corp (OTCMKTS: TRTC) has retraced lower ever since it clocked 2019 highs at the end of the first quarter. The stock has crumbled under soaring bearish pressure. Amidst the steep pullback, the stock is a potential bounce-back play as it is currently trading at the lower end of a tight trading range.
Terra Tech Price Analysis
A plunge to the lower end of the $0.63 to $1 trading range leaves the stock in a precarious position. A plunge lower could elicit further selling pressure while a bounce back could result in the stock making run for this year highs.
In our view, the stock could bounce back on investors reacting to a string of positive developments that affirm the Company’s prospects. For starters, Terra Tech is fresh from launching a legal cannabis delivery services as it continues to pursue growth opportunities in California.
The Company is also fresh from delivering impressive financial results that indicate gross margin expansion as net loss from operations continues to narrow. The sale of Blum Desert is another development poised to strengthen the company’s financial position.
Terra Tech commencing cannabis sales to the adult use market should continue to excite investor’s, ideal for fuelling an upswing in the stock’s price action activity. With the stock appearing to have hit the floor after the recent pullback, a correction higher could be in the offing at the lower end of the trading range.
Namaste Technologies Inc (OTCMKTS: NXTTF) A Bounce Back Play On Robust Revenue
Namaste Technologies Inc (OTCMKTS: NXTTF) has had to contend with wild price swings, as investors reacted to delays in the filling of audited financial results and ousting of Sean Dollinger as the CEO. That could soon change, as the Company has come through and filled results that affirm robust revenue growth.
Namaste Technologies Price Analysis
However, concerns over widening net loss could hurt the stock’s sentiments in the market, at a time when it is in dire need of, groundbreaking catalysts to avert further slides. While the stock has bottomed out, it remains engulfed in a long-term bear trend.
The descending trend line could attract short selling pressure on the filling of negative news that arouse concerns about the Company’s long-term prospects. A spike to the $0.65 level essentially means the stock is at a critical resistance level.
Failure to rally and find support above the resistance level could elicit some form of selling that could see the stock trading sideways. Immediate support on any pullbacks from current highs is seen at the $0.40 mark.
A sell-off followed by a close below the $0.40 mark could result in Namaste Technologies resuming its downtrend, as has been the case for the better part of the past year. Conversely, a rally followed by a close above the $0.66 mark should pave the way for the stock to make a run for the $1.20 mark, seen as the next…
Canopy Rivers Inc (OTCMKTS: CNPOF) Poised For Take-Off
Canopy Rivers Inc (OTCMKTS: CNPOF) is still fluctuating around the 50-day moving average but looks poised for a major take-off. In our last coverage, we acknowledged the significance of the price action which implied the stock was ripe for a bounce from a minor correction.
CNPOF Share Price Analysis
In January 31 2019, Canopy Rivers’ stock attained the highest price year-to-date at $4.43 after a strong start to the year. At the time, the stock had established support at $2.85. However, the stock crossed the 50-day moving average in March sloping downwards in what looks like minor correction. In the last two months, the stock has traded quite close to the MA (50) trend-line and a little jump should bring in the bulls for a massive rally.
In the previous analysis, we noted that key developments including the supply agreement closed by PharmHouse Inc., a portfolio company, were bolstering the strength of the stock’s tailwinds. Further, our analysis indicated that Canopy Rivers was prime for an uptrend due to increasingly positive market sentiment. Also, the stock took out the psychologically important $3 resistance level. Essentially, we concluded that CNPOF was a bounce back play.
Recall that it is just under two weeks our last update on CNPOF and the stock is already up 0.6% at $3.22 a share. In the two weeks, the…