Shares of Marijuana Company Of America Inc (OTCMKTS: MCOA) have started bottoming out after hitting the floor following a rollercoaster first quarter. The bounce back comes on the stock shedding more than 40% in market value in the first three months of the year.
MCOA Catalysts And Price Analysis
A rally from all-time lows follows the confirmation that the company is expanding its footprint into Europe with the unveiling of hempSMART in the UK. The stock’s market sentiments also appear to have received a boost on the company confirming a new joint venture in pursuit of sales opportunities in California.
In addition, Marijuana Company has acquired a 20% ownership interest in Natural Plant Extract of California as it continues to strengthen its prospects in one of the biggest and fastest growing cannabis marketplaces. Marijuana Company is also fresh from reporting an 840% year-over-year increase in revenue a development that underscores underlying growth.
The stock has since started showing signs of bottoming out of the $0.01 level after succumbing to bearish pressure since the start of the year. Price action indicates the stock faces immediate resistance at the $0.02 level as it seeks to bottom out.
A rally followed by a close above the $0.02 level should arouse suggestions that the stock is on its way back to this year highs. For the stock to turn bullish after succumbing to short selling pressure in recent months, it will have to rise and stabilize above the $0.03 level.
Below the $0.03 technical level, Marijuana Company remains susceptible to further drops given the underlying descending trend line that signals bears are in control
What Does MCOA Do?
Marijuana Company is engaged in the development, manufacturing, and distribution of industrial hemp derived and non-psychoactive cannabinoids consumer products. The company distributes its products under the hempSMART brand made up of personal care consumer products for brain wellness.
Europe And California Expansion
Marijuana Company’s market sentiments have edged higher consequently fuelling the upward momentum on the confirmation it is poised to make its hempSMART products available in the U.K. The unveiling in Europe underscores the company’s expansion drive as part of a growth strategy.
In addition to expanding into Europe, the company continues to strengthen and expand its footprint in the U.S cannabis sector. The company has already unveiled a new delivery service dubbed Viva Buds for the distribution of cannabis products in the burgeoning California cannabis market.
Viva Buds is to serve as the marketing arm of Natural Plant Extract of California, which Marijuana Company acquired a 20% ownership interest in, in April. NPE with its licenses for manufacturing distribution and retail delivery is to manage all operations pertaining to cannabis distribution in California. Marijuana Company, on the other hand, is to provide capital consulting and marketing services.
“After a great deal of due diligence and strategic planning, we are happy to execute an agreement to purchase ownership in NPE. This is a major step in staying true to our name Marijuana Company of America and entering into the marijuana industry in California. We have aspirations of becoming a major distributor, delivery service and manufacture in California,” explained CEO Don Steinberg.
Sales Growth Push
Marijuana Company has already entered into a strategic marketing agreement with MassRoots as it seeks to embark on an aggressive marketing campaign of its hemp CBD formulated product line. Under the terms of the agreement, MassRoots is to promote and sell hempSMART products on its website as well as app and social media outlets.
Expansion into the U.K and strengthening of operations in California follows the confirmation that Marijuana Company revenues skyrocketed to $252,135 for the year ended December 31, 2018, from $26,830 a year earlier.
The 840% year-over-year increase in revenues had a positive impact as net loss from operations shrunk by 82% to -$3.8 million from -$21.2 million a year earlier. Gross profit for the full year surged 68% to $170,885.
“This trend is continuing to grow in the first and second quarter of 2019. We think our shareholders are going to be very satisfied with the execution of our highly aggressive growth and restructuring plans in 2019,” stated CFO Jesus Quintero.
Marijuana Company is on its way out of all-time lows as a string of positive developments renew investor interest. Expansion into the UK in pursuit of sales opportunities as well as the strengthening of operations in California are some of the developments that should continue to shore up market sentiments.
We will be updating our subscribers as soon as we know more. For the latest updates on MCOA, sign up below!
Disclosure: We have no position in MCOA and have not been compensated for this article.