Harvest One Cannabis Inc (CVE:HVT) Has Big Upside Potential

Harvest One Cannabis Inc (CVE:HVT) is yet again on the receiving end as bears threaten to push the stock lower, after a recent pullback. A recent spike to the $1 mark came at the back of improving fundamentals but appears to have lost momentum. The rally came after one of the longest bear runs that saw the stock plunge to the $0.6 handle.While the stock remains engulfed in a strong bear trend, improving fundamentals continue to reignite hope of a potential bounce back after a recent rally. The company is fresh from announcing an investment in Burb Cannabis.In addition, it has expanded its footprint in the cannabis retail on signing a Manitoba supply agreement. The company is also plotting international expansion having strengthened its H1 team by adding four seasoned executives to the board.

Harvest One Price Analysis

It thus comes as a surprise that the stock has pulled lower after threatening to break out of the bear trend in September given the string of positive developments. After the recent pullback, the stock needs or rally and stabilize above the $0.75 handle to reaffirm the emerging bullish trend. Above the $0.75 mark, the stock should be on its way to the $1 a share mark, seen as a key psychological resistance level.A rally followed by a close above the $1 mark, should go a long way in attracting investors who until now have been on the fence. However, considering the stock has tanked to below the $0.75 mark, it remains susceptible to further drops back to the $0.60 mark.

What Does Harvest One Do?

Harvest one casts itself as a global cannabis company, focused on the development of innovative lifestyle and wellness products. The company is especially focused on the cannabis business where it cultivates processes and distributes an array of cannabis products.

Burbs Cannabis $1.75 Million Investment

While investor’s confidence in the stock is still at all-time lows, Harvest One continues to strengthen its long-term prospects with the signing of supply agreements. The company has already made an investment in Burb Cannabis as part of its aggressive retail strategy.The company invested $1.75 million for a 20% stake in the British Columbia cannabis retailer. The investment is part of the company’s broader vertically integrated corporate strategy.

"Harvest one is committed to providing consumers with high-quality, end-to-end cannabis solutions and investing in Burb helps us achieve this goal. The investment in Burb also allows Harvest One to play a pro-active role in educating consumers about recreational cannabis and shape the future of cannabis retail in Canada,” said Grant Froese, CEO of Harvest One.

With the investment, Burb’s will now be able to open eight new stores in British Columbia by early next year. The new stores should act as a reliable sales channel for Harvest One at a time of growing demand for cannabis products. Revenue growth should be the order of the day as the company moves to target a wider target audience with its aggressive retail strategy.

Supply Agreements

In addition, Harvest One has entered into a supply agreement with Manitoba Liquor and Lotteries for the supply of high-quality cannabis for recreational use. The supply agreement strengthens the company’s retail strategy providing yet another exciting sales channel.

“Our Royal High products have received tremendous praise from medical users, and we now look forward to bringing them, as well as other specialty products, to the recreational market in Canada as well,” Froese in a statement.

The Manitoba Supply agreement follows the signing of a similar agreement in September between the company’s wholly-owned subsidiary United Greeneries Ltd and Ontario Cannabis Retail Corporation. The agreement is for the supply of quality cannabis for online sales targeting recreational marijuana users.Harvest One has set sights on Ontario Cannabis marketplace given the opportunities up for grabs with the legalization of recreational use.

Bottom Line

Harvest one is trading close to this year’s lows. While the stock remains vulnerable to further declines, one cannot dispute the strengthening fundamentals that support further movements on the upside. The signing of supply agreements affirms the company’s push for sales in the fast-growing Canadian Cannabis sector.The supply agreements also attest to the growing credibility and demand for the company’s cannabis products. That said, it might be a matter of time before investors take note of the improving fundamentals.After the recent plunge, an ideal play would be to wait for the stock to rally and stabilize above the $0.80 mark to consider it a long-term investment.We will be updating our subscribers as soon as we know more. For the latest updates on CVE:HVT, sign up below!Disclosure: We have no position in CVE:HVT and have not been compensated for this article.