Shares of Golden Leaf Holdings Ltd (OTCMKTS:GLDFF) have once again come tumbling down after a phenomenal start to the year. Short sellers have taken the fight to bulls in line with the descending long-term bear trend. In 2018, the stock tumbled amidst growing concerns about the company’s prospects.
Share Price Analysis
Fast forward, the company has sought to reaffirm its prospects depicted by a string of developments. For starters, the company has carried out a number of management changes in line with an ongoing restructuring drive.
However, the company is not yet out of the woods as investors continue to question its long-term prospects. The stock has since resorted to trading in a downtrend in what appears to be a continuation of the long-term bear trend. A spike to the $0.14 level experienced strong resistance, resulting in the stock pulling back to the $0.10 handle. Price action activity indicates the stock could plunge back to its 52-week lows of $0.064.
A breach of the 52-week low would open the door for short sellers to continue pushing the stock lower. On the upside, rallies look set to experience strong resistance at the $0.14 level. For the stock to turn bullish, it needs to surge and stabilize above the $0.14 level.
About Golden Leaf Holdings
Golden Leaf Holdings produces distributes and sells cannabis oil and flower products. The company is also engaged in eh research and development of cannabis products as well as leasing of capital equipment. The Canadian company has also expanded its footprint into the U.S where it maintains cannabis cultivation production and retail operations.
After taking a hit over the past year, the company has turned to management changes as it looks to reinvigorate its prospects in the cannabis industry. The company has since confirmed the appointment of Karyn O. Barsa as the Chief Financial Officer.
Barsa is tasked with the responsibility of leading the company’s financial operations in addition to managing liquidity, balance sheet, and capital market transactions. Ms. Barsa joins the company with 20 years of progressive financial leadership and will be looked upon to position Golden Leaf Holdings to capitalize on growth opportunities.
“I believe I have the background and experience to make a difference at Golden Leaf. Bill and I share a vision for creating a strong organizational management team, an environment of accountability and efficiency, and a robust process for evaluating opportunities, all of which are expected to lead to the creation of shareholder value,” Ms. Barsa in a statement.
Golden Leaf Holdings has also confirmed the appointment of Larry H. into the board of directors. He joins the audit and compensation committees.
The appointments come at a time when the company is shrouded in a lot of uncertainties. For starters, it has terminated an agreement to acquire a multi-use sweet 16 license and certain other assets in San Jose. In defense of the termination CEO, Bill Kulczycki insists the termination came down to economics.
“Back when this deal was originally signed, there were limited M&A opportunities for entry into California of the size that Golden Leaf wanted to take on. […]Going forward we plan to enter new jurisdictions by first leveraging existing resources and the assets and infrastructure of strategic partners,” said Mr. Kulczycki.
In addition, the company has terminated a deal to acquire assets belonging to Tahoe Hydroponics. The termination comes on the heels of the company experiencing challenges in obtaining regulatory approvals in Canada.
“We are currently looking at opportunities that fit our strategic vision in an appropriate order of priority, balanced between assessments of risk and cash flow returns that drive shareholder value creation. My immediate focus for Golden Leaf is one of disciplined growth with the goal of achieving profitability in the near term,” Mr. Kulczycki in a statement.
Golden Leaf Holdings has taken a significant hit ever since it confirmed it would no longer pursue Terra Tech Corp acquisition. Termination of a string of acquisitions also continues to rattle investors given that it raises concerns about the company’s long-term prospects.
After the recent plunge, the stock looks set to remain under pressure until the stock serves groundbreaking catalysts needed to reinvigorate investor interest.
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Disclosure: We have no position in GLDFF and have not been compensated for this article.