Cannabis Strategic Ventures (OTCMKTS:NUGS) Delivers Big Gains For Our Subscribers

Do you remember our work on Cannabis Strategic Ventures (OTCMKTS:NUGS)? In our piece called "Cannabis Strategic Ventures (OTCMKTS:NUGS) Is A Cannabis Runner," we mentioned that this was a name to follow closely. NUGS did show a solid balance sheet, revenues of up to $0.1 million, and tremendous revenue growth, it was also releasing exciting developments, like a new investment pool geared toward investment in cannabis projects in California, and a new contract worth $400,000. Many in the market seemed to appreciate the information coming from the company and the market had pushed the stock price close to $1. The stock returns were extraordinary and were worth appearing on our website.As of today, we know that we did very good highlighting the company. The share price did not stop at $1. In less than ten days, the market continued to push up the share price, which could touch all time highs of $6.0. For those who need a calculator, the share price move represents 500% returns, which are astonishing returns even for a micro-cap company. Additionally, for those checking the volume as well as the price, let us note that they are large as well. More than 1 million shares changed hands, which seems to show that many in the market were able to get some of these fantastic returns.Have a look at the recent share price action: 1-month chart for NUGSWe are revisiting the business model of NUGS for the starters. The company was founded in 2003 and is headquartered in Beverly Hills. It operates in the cannabis industry and is specialized in providing temporary, permanent, and long-term staffing solutions, employment and human resources consulting and Professional Employment Organization services to other operators.What's going on?First of all, it seems that the announcement regarding the new financing and investment pool caused a lot of market expectations. It was announced on December 19, 2017. As we noted, it created a massive share price spike. What we could not foresee was that the share price would continue going up.The announcement is very significant, as it shows not only that the company has many new initiatives that could push up growth, but it also indicates that NUGS can raise cash to finance these new investments targeting cultivation opportunities. Additionally, the announcement is also significant, as the company is finally increasing the number of activities in the marijuana industry. As it was said in the announcement, NUGS will not only focus on Employment, HR and Staffing operations, but also in the areas of real estate, cultivation, extraction, packaging, and dispensary operations. More services may mean more revenues, so the market got quite excited.But, the most interesting was still to be released.On January 3rd, 2018, the company noted that it had signed a Letter of Intent with an approximately two-acre cannabis cultivation and processing project in Santa Barbara County. We already know that the company was looking for opportunities in Santa Barbara County, but this contract has made these efforts official, which made the market push up the share price.We could read that the project seems to be already at an advanced stage. The company has already hired strategic partners with expertise in both areas to be prepared for this growth, and it is right now executing due diligence. On the top of it, the management is also discussing other opportunities in California. We will need to be very alert as if new agreements or projects are released; a new share price spike could occur.It is a low float runnerAnother logical explanation for the recent share price volatility is the small float exhibited. There are 277,458,451 shares outstanding, and a float of 3,830,656 shares. This means that many shares are not owned by the public, so the order book may be quite empty. As a result, significant market orders could quickly push the share price up or down and increase volatility. Some of our readers appreciate very much playing volatility games in the OTC universe. Thus, we need to note this feature. Market participants who are not experts in this field should stay away from this stock, as stock returns can be high, but losses can be substantial as well.ConclusionCurrently trading with a market cap of $1,669 million, NUGS is an exciting story among small caps. With $0.2 million in cash, $0.6 million in assets and only $65,000 in total liabilities, we continue to believe that the company's financial shape is quite solid. Additionally, we believe that it may be time to try to raise capital and bring even more cash to the balance sheet. Market participants seem to be paying heed to an astonishing amount of expected future growth and, in our opinion, the company should try to profit from it.Regarding what short sellers are doing, they seem to believe that the company is overvalued at this point. The short interest increased from 100 to 12,184 in a short period of time.DateShort Interest% ChangeAvg. Daily Share VolumeDays to CoverSplitNew IssueDec 15, 201712,184100.0088,5971.00NoNoOct 13, 20173,272100.0044,7831.00NoNoSept 15, 2017100100.0013,9151.00NoNoSourceTo sum up, be ready for a lot of share price volatility on this name. For those that got in on the back of our prior coverage, congratulations.We will be updating our subscribers as soon as we know more. For the latest updates on NUGS, sign up below!Disclosure: We have no position in NUGS and have not been compensated for this article.Image courtesy of haRee via Flickr