Marijuana Company of America Announces Reverse Stock Split of Common Stock
ESCONDIDO, Calif., July 03, 2019 (GLOBE NEWSWIRE) — via NetworkWire – MARIJUANA COMPANY OF AMERICA INC. (“MCOA” or the “Company”) (OTCQB: MCOA), an innovative hemp and cannabis corporation, today announced that the Company’s Board of Directors and Stockholders have approved a reverse stock split of its issued and outstanding common stock at a ratio of 1-for-60. The decision was made at a Special Meeting of Stockholders held on July 1, 2019.
The reverse stock split is intended to give Marijuana Company of America greater flexibility in considering and planning for future potential business needs, and to increase the per-share trading price of its common stock to enable the Company to satisfy the minimum price requirement for continued listing on the OTCQB. Pursuant to the Amended Certificate to MCOA’s Certificate of Incorporation, the reverse stock split will be effective on July 31, 2019, at 12:01 a.m. ET. Subject to approval of the corporate action by FINRA, MCOA expects that upon the opening of trading on Aug. 1, 2019, its common stock will trade on a split-adjusted basis with a new CUSIP number under current trading symbol “MCOA.”
The reverse stock split affects all issued and outstanding shares of MCOA common stock. The par value of MCOA common stock will remain unchanged at $0.001 per share after the reverse stock split. The reverse stock split affects all stockholders uniformly and will not alter any stockholder’s percentage interest in MCOA’s equity. No fractional shares will be issued in connection with the reverse split. Stockholders, who would otherwise be entitled to receive a fractional share, will instead receive one additional share as determined in good faith by MCOA’s Board of Directors.
Pacific Stock Transfer Company is acting as the exchange agent and transfer agent for the reverse stock split. Stockholders holding their shares electronically in book-entry form are not required to take any action to receive post-split shares. Pacific Stock Transfer will provide instructions to stockholders with physical certificates regarding the process for exchanging their pre-split stock certificates for book entry of the appropriate number of post-split shares. Stockholders owning shares through a bank, broker or other nominee will have their positions adjusted to reflect the reverse stock split in accordance with their respective bank’s, broker’s or nominee’s particular processes. Additional information regarding the reverse stock split is provided in the Company’s information statement to be filed with the Securities and Exchange Commission.
About Marijuana Company of America, Inc.
MCOA is a corporation that participates in (1) product research and development of legal hemp-based consumer products under the brand name “hempSMART™” and targets general health and well-being; (2) an affiliate marketing program to promote and sell its legal hemp-based consumer products containing CBD; (3) leasing of real property to separate business entities engaged in the growth and sale of cannabis in those states and jurisdictions where cannabis has been legalized and properly regulated for medicinal and recreational use; and (4) the expansion of its business into ancillary areas of the legalized cannabis and hemp industry, as the legalized markets and opportunities in this segment mature and develop.
About Our hempSMART Products Containing CBD
The United States Food and Drug Administration (FDA) has not recognized CBD as a safe and effective drug for any indication. Our products containing CBD derived from industrial hemp are not marketed or sold based upon claims that their use is safe and effective treatment for any medical condition as drugs or dietary supplements subject to the FDA’s jurisdiction.
Forward Looking Statements
This news release contains “forward-looking statements” that are not purely historical and may include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, the development, costs and results of new business opportunities and words such as “anticipate,” “seek,” intend,” “believe,” “estimate,” “expect,” “project,” “plan” or similar phrases that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with new projects, the future U.S. and global economies, the impact of competition, and the Company’s reliance on existing regulations regarding the use and development of cannabis-based products. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that any beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that any such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-12G, our quarterly reports on Form 10-Q and other periodic reports filed from time to time with the Securities and Exchange Commission. For more information, please visit www.sec.gov.
Corporate Communications Contact:
New York, New York
For more information, please visit the Company’s websites at:
ESCONDIDO, Calif., July 03, 2019 (GLOBE NEWSWIRE) — via NetworkWire – MARIJUANA COMPANY OF AMERICA INC. (“MCOA” or the “Company”) (OTCQB: MCOA), an…
3 Undervalued Hemp/CBD Stocks Investors Need To Be Watching
2019 has been a tough year for the cannabis industry and the sector has been in a downward trend for several months. Although the recent weakness has been concerning, we believe that the cannabis sector is well positioned for growth as we head into 2020 and beyond.
Going forward, we believe that selectivity will be more important than ever and investors need to be focused on operators that are laser focused on execution and that have a proven track record of creating value for shareholders. During the last few months, we have taken a deep dive into the cannabis industry to better understand the growth prospects associated with certain verticals of the industry.
When looking at how the cannabis industry has evolved from the end of 2018 to the end of 2019, one of the most interesting developments is related to the verticals that these businesses are focused on. In the early years of the cannabis industry (2014 to 2017), investors were primarily focused on Canadian companies that were producing cannabis. During the last two years, the cannabis sector has evolved and investors have become highly focused on new market opportunities.
From cannabis infused products to cannabis retail operations, the types of cannabis investment opportunities have changed and this is a trend that we continue to follow. One of the biggest trends within the cannabis industry is related to the hemp market and this is an opportunity that we have been excited about. During the last year, there has been a significant increase in the amount of consumer demand for products that contain cannabidiol (CBD) and other high-value cannabinoids.
The biggest catalyst for the US hemp-CBD market was the passage of the Farm Bill in late 2018. The legislation effectively legalized the domestic production, processing and selling of CBD products. After the passing of the Farm Bill, big-box retailers (i.e. CVS, Target, Walmart, and Walgreens) started to sell a variety of CBD products in-store and online as consumer demand continued to increase.
We have been highly focused on the CBD market (US and international) and are bullish on the growth prospects and the economics associated with this burgeoning opportunity. When looking at the CBD opportunity, we see a cannabinoid that has been widely accepted by the market (and by government, especially when compared to THC) and find this to be significant. Today, we have highlighted 3 companies that are capitalizing on the hemp industry via differentiated growth strategies and believe that these are opportunities to be watching.
Future Farm: A CBD Growth Story that is Trading for a Discount
One of the metrics that we closely analyze when looking at hemp-focused companies is valuation or market capitalization and we find this metric to be especially important for this vertical. The disparity in the valuations of publicly traded hemp companies is significant and we want to highlight a business that has been flying under the radar.
The company, Future Farm Technologies (FFT.CN) (FFRMF) has been highly focused on the US hemp opportunity and has been working to become a leading domestic hemp producer. During the last year, the company has been able to significantly advance its fundamental story and enhance its growth prospects by executing on a multi-faceted growth strategy. We believe that the market does not appreciated the growth prospects associated with the existing assets in place and wanted to provide some highlights on the opportunity.
Earlier this month, Future Farm reported a major milestone after the hemp from its Maine farm passed the state-mandated testing for acceptable levels of THC. In the coming weeks, the team expects to harvest the farm and the passing of the test was the last regulatory hurdle that Future Farm had to clear. We believe that the growth prospects associated with the harvest are significant and expect the company to generate significant revenues from it.
In a world where safety is of the utmost importance, Future Farm will be able to ease concerns by utilizing independent laboratories to test the harvested hemp throughout the drying and curing processes. The management team believes that the CBD opportunity in Maine is more significant than it was last year due to a change in law, whereby food products that contain CBD that are produced and sold in Maine are not considered to be adulterated.
When analyzing cannabis businesses, you want to identify an operator that can operate efficiently and allocate capital appropriately. In early August, Future Farm refined its strategy to focus resources on existing business operations that are expected to meaningfully increase revenue on a going-forward basis. Going forward, the company will be laser focused on selling the high-value cannabinoids that are extracted from its Maine farm to manufacturers of consumer CBD products. We are favorable on the refined strategy and expect to see Future Farm report ramping revenues and improving margins as a result of it.
At the time of this announcement, Future Farm also reported plans to continue to pursue licenses to grow cannabis for research and development in Canada in partnership with Rahan Meristem. The company sold the interests that it had its THC focused businesses to improve its access to capital and to simplify other aspects of business operations such as banking and tax planning. As part of this strategy, Future Farm sold its interest in FFPR to its partner Clinica Verde, which was focused on developing dispensaries in Puerto Rico.
Shortly after making this decision, Future Farm’s subsidiary, CEPG Consulting and Design (CEPG), was issued an Industrial Hemp License from Health Canada and we are favorable on the continued execution as it relates to this opportunity. The granting of the license allows CEPG to commence construction of its planned hemp research facility and we are monitoring how the team continues to execute on this.
During the last few months, Future Farm has been under considerable pressure and has traded lower with the rest of the cannabis sector. At current levels, the North American CBD company has a market capitalization of approx. $9 million (CAD) and we find the risk-reward profile to be attractive. The management team seems to be highly focused on being able to execute in a capital efficient manner and we consider Future Farm to be a turnaround story in the making.
Veritas Farms: A CBD Execution Story
Since inception, we have been closely following Veritas Farms, Inc. (VFRMD) and are impressed with the way the management team has been executing on the US CBD market. Veritas Farms is a vertically integrated agribusiness that is focused on the production of full spectrum hemp oil products with naturally occurring cannabinoids. The company’s product line has been gaining traction and is currently being sold at CVS retail outlets across the country.
Earlier this month, Veritas Farms CEO Alexander Salgado released a letter to shareholders that highlighted a number of aspects of the business. The update focused on the decision to enact a reverse stock split, the state of operations (from a growth and a capital needs standpoint), and potential catalysts for growth.
During the last year, we have seen several companies complete reverse stock splits and the market has responded negatively to these decisions on average. CEO Alexander Salgado said the reverse stock split was completed to reduce the number of shares outstanding and to increase the probability of the company up-listing from the OTC Exchange to a national securities exchange (i.e. Nasdaq or NYSE). The up-listing process is complex, and we will monitor how the management team is able to execute on it.
2019 has proven to be a banner year for Veritas Farms and the business has benefited from the passage of the Farm Bill. When you compare the first six-months of 2018 to 2019, there is a lot to be excited about. During this time, the company has recorded massive revenue growth ($818,585 to $4,496,275) and this is a trend that is expected to continue in 2020 and beyond.
One of the primary drivers of revenue growth was the aggressive expansion of the company’s retailer and distributor network. Veritas Farms currently has more than 4,500 retailers and distributors within its network and we are bullish on the growth prospects associated with this. Going forward, the management team expects this trend to continue as the company remains laser focused on expanding domestically and internationally.
Veritas Farms is well capitalized and is well positioned to execute on its previously announced initiatives. During the last two years, the company has raised more than $20 million to fuel growth and we will monitor how the management team continues to drive the story forward. Going forward, we will watch how the market responds to the reverse-stock split and will keep the stock on our radar.
1933 Industries: A Fully Funded Cannabis Growth Story
1933 Industries (TGIF.CN) (TGIFF) is highly levered to the US CBD market through its Canna Hemp subsidiary and we are bullish on this opportunity for a number of reasons. When looking at 1933 Industries, we see a company that has visible growth prospects as it is in the middle of moving into a much larger cultivation facility in Las Vegas.
Last week, the market responded favorably to an operational update that was released by the company that highlighted the recent developments and the potential catalysts for growth. Despite the recent move higher, the company is trading a considerable discount to its peers when compared on almost every metric and we find this to be of importance.
Going forward, 1933 Industries is well positioned to increase market share in strategic cannabis markets (for THC products) while increasing the number of stores that sell its CBD products. We believe that the company has significant infrastructure to capitalize on the domestic CBD opportunity and believe that the market does not fully appreciate the long-term growth prospects associated with this.
The Canna Hemp wellness line continues to gain traction and has established itself as a premium CBD brand in the US. During the last year, Canna Hemp has been a major value driver for the overall business and the product line is available in more than 800 retail outlets. Over the next year, we expect Canna Hemp to gain further traction and we are favorable on the relationships in place to support growth.
When it comes to Canna Hemp, we are excited about the relationship with Zumiez, a leading specialty retailer that is now carrying the company’s CBD Canna Hemp X sports cream, which was launched in collaboration with top skateboarding company Grizzly Griptape. Next month, the exclusive Birdhouse Skateboards/Canna Hemp X co-branded sports cream is expected to hit the market and will be available at Zumiez stores across the US.
We believe that the strategic relationships that 1933 Industries has with companies like Zumiez and brands like Birdhouse represent important differentiators for the business and will help support growth on a going forward basis. The company is well capitalized and well positioned to increase the production of CBD and THC products following the sale of its purpose-built cultivation facility for $10.45 million (negotiated a 10-year lease-back agreement to operate the facility). 1933 Industries plans to use the proceeds to fund infrastructure projects in Nevada and California, to open new markets in Arizona and Colorado, and to continue the expansion of its Canna Hemp consumer branded goods across the US.
At current levels, 1933 Industries has an attractive risk-reward profile and is trading at discount when compared to its peers. Over the next year, we expect to see the management team continue to drive the story forward and are favorable on the platform that the company has is in place for growth. We expect 2020 to be a banner year for the US cannabis business and 1933 Industries is a company to have on your radar.
Pursuant to an agreement between StoneBridge Partners LLC and 1933 Industries we have been hired for a period of 180 days beginning July 15, 2019 and ending January 15, 2020 to publicly disseminate information about (TGIF) including on the Website and other media including Facebook and Twitter. We are being paid $7,500 per month for a period of 6 months. We own zero shares of (TGIF), which we purchased in the open market. We plan to sell the “ZERO” shares of (TGIF) that we hold during the time the Website and/or Facebook and Twitter Information recommends that investors or visitors to the website purchase without further notice to you. We may buy or sell additional shares of (TGIF) in the open market at any time, including before, during or after the Website and Information, provide public dissemination of favorable Information.
Technical420 is dedicated to educating investors about the risk and rewards of investing in the cannabis industry. We highlight companies that have the most growth potential by utilizing our proprietary analytics platform.