Cannabis stocks got hammered today, as investors began to prepare for what many believe with be less-than-stellar results for a number of major cannabis companies, including Canopy Growth Corporation (NYSE: CGC), Aurora Cannabis (NYSE: ACB), and Tilray (NASDAQ: TLRY).
Another cannabis player scheduled to post earnings this week is Supreme Cannabis (TSX: FIRE). I’m paying particularly close attention to this one.
Last quarter, the company announced record revenues, showing a nearly 230 percent increase from the previous year. The company had also just upgraded to the OTCQX market in the US and pulled in about $76 million via a bought deal of convertible debentures.
Since those earnings, the company has been quite active.
Last December, Supreme announced a deal to develop a premium cannabis brand with Wiz Khalifa, one of the most successful rappers in the world. With more than 25 million followers on Instagram, 33 million followers on Twitter, and 38 million followers on Facebook, he is a major celebrity influencer.
Khalifa is also worth about $45 million.
Last month, the company’s 7 Acres facility was approved for additional production capacity, and it also started trading on the TSX, which is putting more asses in the seats.
And just last week, Supreme announced that it had expanded domestic distribution to eight provinces.
While I don’t know how earnings are going to look this quarter, it’s clear that the company is bolstering its presence in the Canadian cannabis market. And while it’s not as big as some of the more well-known players, such as Canopy Growth Corporation (NYSE: CGC) and Aphria, (NYSE: APHA), the stock is still fairly reasonable in terms of valuation.
If Supreme can show a nice bump in revenue again, and steer clear of any major losses, the stock could be on it’s way to $3.00.