A bear run that had pushed Emblem Corp (OTCMKTS:EMMBF) to all-time lows, appears to be losing momentum. A recent bounce back coupled with a high turnover of shares traded points to a possible change in the stock’s direction of trade.
A lot has changed from our previous update, even though the stock has failed to live up to expectations on coming under immense selling pressure.
The stock has since bounced back from the $1 a share mark and is currently trading at the $1.23 handle. It remains to be seen if the stock will rise and close above the $1.30 mark, seen as a critical resistance level. Failure to stabilize above the critical resistance level could open the door for the stock to tank to its all-time lows.
The upside momentum could pick pace in the wake of Emblem Corp serving a number of catalysts that continue to affirm its growth prospects. Before carrying out a detailed analysis of the catalysts likely to push the stock higher, let’s look at what Emblem Corp does in pursuit of growth and shareholder value
Headquartered in Toronto Canada, Emblem Corp is a subsidiary of Emblem Cannabis Corporation. The company bills itself as a fully integrated licensed producer and distributor of medical cannabis and cannabis derivatives.
The company operates under three distinct verticals of cannabis production, patient education centers, and pharmaceuticals dosage form development.
Emblem Cop shares have been trading higher on investors reacting to the signing of a 3-year supplier agreement with Fire & Flower. Under the terms of the agreement, the company is to supply Fire & Flower with Emblem branded cannabis products.
According to the Chief Executive Officer, Nick Dean, the deal presents a unique opportunity for the company to reach out to a broader target market with its adult-use brands.
“Today’s deal with Fire & Flower reinforces our belief that the greatest shareholder value will be achieved in the long-run via channels that give the greatest access to consumers. As Fire & Flower is building a leading retail concept in the cannabis space, we anticipate that this arrangement will assist us in our single-minded focus on driving shareholder value,” said Mr. Dean
The Fire & Flower partnership builds on yet another agreement that Emblem Corp signed with Shoppers Drug Mart. The agreement paves the way for Emblem Corp to supply Shoppers Drug Mart with Emblem branded cannabis products, which are to be sold online.
The agreement is subject to Shoppers Drug Market getting approval from Health Canada to become a licensed producer. According to the Chief Executive Officer, the deal solidifies the company’s bid to become a world leader in the supply of cannabis for medical purposes.
Growing Market Share
In an attempt to further grow its market share in the lucrative cannabis business, Emblem Corp has confirmed three strategic hires. Maria Guest has since been appointed as the company’s new Chief Marketing Officer, tasked with the responsibility spearheading the company’s marketing campaigns in pursuit of sales and market share.
Ms. Guest is to lead the company’s adult-use strategy, tasked with the responsibility of coming up with unique brands to take advantage of the burgeoning market.
The company has also appointed Kim Horrill as the vice president of Medical Marketing and Tim Andrews as the Vice President, creative director. Ms. Horrill joins the company with vast healthcare and pharmaceutical experience and will oversee the company’s medical outreach program.
Mr. Andrew, on the other hand, is to oversee all Emblem Corp brand development and marketing projects. He is to work with agency partners to support and accelerate go-to-market plans.
Emblem Corp 2018 Outlook
Emblem Corp started 2018 with an incredibly strong balance sheet with close to $85 million, sufficient for supporting growth plans. The company plans to complete two state-of-the-art cultivation and manufacturing facilities in Paris, as it moves to accelerate the speed at which it releases new products to market.
Plans are also underway to make strategic investments in R&D, clinical research, product development and licensing as the company looks to strengthen its prospects in the highly competitive business.
“Each of these endeavors collectively allows Emblem to maintain its leadership position within the medical side, as well as poises us for a unique and competitive advantage in the adult-use space. Our team has been very active in pursuing these opportunities, and we look forward to sharing some exciting announcements in the coming weeks,” Emblem Corp in a statement.
In addition, Emblem Corp is pursuing supplier agreements and strategic partnerships that it hopes will go a long way in strengthening its revenue streams.
What Next For Emblem Corp
2018 could turn out to be a pivotal year for Emblem Corp if first quarter achievements are anything to go by. The signing of supplier agreements underscores the company’s commercialization strategy as it continues to explore new streams of revenues.
Emblem Corp has every reason to succeed in 2018 given that it boasts of $85 million in its balance sheet that it can use to pursue growth opportunities. A recent dip in share value may as well have presented a unique buy opportunity for a stock with enormous potential.
Disclosure: We have no position in EMMBF and have not been compensated for this article.