A second consecutive quarter of record revenue and profits and it is safe to say things are looking rosy for Surna stock. Surna stock has bounced back nicely and recouped a substantial amount of the losses on the way.
Surna Stock Price Analysis
After a wave of consideration, the upward momentum looks set to pick up some steam as investors react to improving fundamentals. Revenue growth and profitability are some of the factors that continue to affirm the company’s long-term prospects.
In addition, the company’s cash position has improved considerably in recent months. That said, the company remains well-positioned to pursue strategic initiatives that have the potential to accelerate revenue growth as well as create value for shareholders.
With the stock trading at the lower end of a tight trading range, a bounce-back could be in the offing in continuation of the emerging uptrend. Conversely, a rally followed by a close above the $0.09 level should help fuel the upward momentum setting the stage for the stock to continue powering higher.
That said Surna needs to rally and find support above the $0.10 level to be on its way to registering one-year highs. Conversely, a breach of the $0.06 level could give short sellers a reason to continue pushing the stock lower in continuation of the long-term downtrend.
In our view, Surna is on its way to powering higher in continuation of the emerging uptrend.
About Surna Stock
Surna designs, engineers and manufactures environmental control and air sanitation systems used in regulated indoor cannabis cultivation facilities across the U.S and Canada. The company provides energy and water-efficient solutions that allow growers to meet the demand for active cannabis cultivation. The company has so far played a role in the commissioning and operation of over 800 grow facilities.
Improved Operational Efficiency
Surna sentiments in the market have received a boost on the company reporting impressive financial results for its third quarter. Revenues in the quarter were up 66%, surging to another record high of $5.5 million. The increase stems from two expansion project contracts that the company signed in the second quarter with a single multi-facility.
The company also achieved back-to-back quarters of positive operating and net income. Operating income in the third quarter surged to $277,000 as net income came in at $222,000. Cash levels in the quarter increased to $2 million as the company generated $1.75 million from operating activities in the first nine months of the year.
Tony McDonald, the Company’s CEO, stated: “We are extremely pleased with our second straight quarter of record revenue and profits. We continue to focus on our two key financial metrics: revenue growth and profitability
However, gross margins in the quarter shrunk to 28.6% from 34.4% reported in the second quarter. The decline was because of the company taking advantage of larger project opportunities that included a high proportion of nonproprietary products
In a bid to accelerate growth and generate long-term value, Surna management has already identified new business verticals that should help complement the company’s climate control business. The verticals include the automation of processes for delivering nutrients and water to plants as well as the development of systems for optimizing the use of growing space.
The company is also thinking of developing cultivation management technology. To achieve the new business verticals, Surna intends to ink strategic partnerships with like-minded companies and businesses. The company is also considering the possibility of carrying out acquisition in a bid to achieve some of the verticals.
“Under the right circumstances and at the appropriate time, we believe acquisitions and related capital infusions of growth equity, combined with the proper execution of our growth plan, can accelerate our progress towards consistent cash operating profitability,” Surna in a statement.
Listing on the NASDAQ is another milestone that Surna management wants to achieve in the coming years.
After a poor start to the year, Surna stock has bounced back nicely. Improved operational efficiency has seen the company post impressive financial results in recent quarters. A second consecutive quarter of record profit and revenues attests to a company firing on all angles.
With the company having uncovered new business verticals expected to generate long term value, the stock is trading at a discount relative to its long term prospects. As it stands, Surna stock is a great pick for long-term investors.
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Disclosure: We have no position in Surna stock and have not been compensated for this article.
Forget APHA and ACB, Buy GTBIF and TCNNF
There are a lot of misconceptions going on when it comes to US legalization. Many investors are buying Aphria (APHA) and Aurora Cannabis (ACB) hoping to bank on what’s happening in the US. However, they are Canadian Licensed Producers and have no business in the US. Investors are buying them because they trade on the major exchanges, but that is the wrong move. The correct move is to buy the US multi-state operators like Green Thumb Industries (GTBIF) and Trulieve Cannabis (TCNNF).
On Election Day voters in New Jersey, Arizona, Montana and South Dakota voted to legalize recreational marijuana. South Dakota and Mississippi voters also approved measures to legalize medical marijuana.
There’s also the prospect of a more pot-friendly White House with President-elect Joe Biden. Vice Presidential Candidate Kamala Harris said at the debate a Biden administration would decriminalize marijuana at a federal level and expunge criminal records of people with marijuana-related offenses.
Green Thumb Industries Inc. (“Green Thumb”), a national cannabis consumer packaged goods company and retailer, promotes well-being through the power of cannabis while giving back to the communities in which it serves.
Green Thumb manufactures and distributes a portfolio of branded cannabis products including Beboe, Dogwalkers, Dr. Solomon’s, incredibles, Rythm and The Feel Collection.
The company also owns and operates rapidly growing national retail cannabis stores called Rise™ and Essence. Headquartered in Chicago, Illinois, Green Thumb has 13 manufacturing facilities, licenses for 96…
What Do Investors See In Medical Marijuana Stock (OTCMKTS:MJNA)?
Medical Marijuana Stock (OTCMKTS:MJNA) has emerged as one of many investor’s favorite pot stocks in the legal cannabis universe in 2020. The stock is already up about 10% in 2020, demonstrating how investors have warmed up to the stock early on in the New Year.
Following a disastrous 2019, cannabis investors lost money but have also learned that their best bets are stocks with strong fundamentals. They are looking for companies that have positioned themselves well in the cannabis industry and have what it takes to go for the opportunities. That is why MJNA stock is catching a lot of investor attention in 2020 because of how it has positioned itself in the cannabis market.
Robust revenue growth and strong financial position have also helped put MJNA on the radar of investors hunting for quality cannabis stocks. Revenue at MJNA more than doubled from $26.5 million in 2017 to $60 million in 2018. MJNA is also not in financial distress as may be the case with other cannabis companies out there. The company finished the third quarter, the most recent reported period, with $5.5 million in cash reserves.
Moreover, MJNA has recently taken steps to expand into new international markets and invest in companies that are leaders in their segments. These prudent actions are helping lift Medical Marijuana stock as more investors learn about them.
About Medical Marijuana stock
Is Tilray Inc (NASDAQ:TLRY) A Buy Or Sell?
For Tilray Inc (NASDAQ:TLRY) and the rest of cannabis stocks, 2019 was no doubt a bad year. But 2020 is shaping up to be a promising year for the stock. To start with, Tilray stock has already gained 8.35% year-to-date. If that says anything, it shows following the broad selloff in Tilray stock last year, we’ve got to a point where sellers are giving way to buyers in the stock.
There are several catalysts that should continue driving NASDAQ:TLRY as you’re about to see. First, below is a brief profile of the company we’re discussing.
Tilray is a Canada-headquartered global cannabis company. It is engaged in activities of cannabis cultivation and processing as well as marketing and distribution of cannabis products. Tilray already has several cannabis products brands to its portfolio. It operates across five continents through subsidiaries in Canada, Australia, Germany, and Portugal.
Following the broad collapse of cannabis stocks in 2019, investors are looking for cannabis stocks that can make a positive impact on their portfolios in 2020. Tilray stands out as an attractive cannabis stock pick in 2020. Here are some of the exciting things about the company.
Tilray CEO sees a bright future for the cannabis industry
On January 25, Tilray CEO Brendan Kennedy spoke on Bloomberg. In that interview, Kennedy framed a rosy outlook for the…