Medical Marijuana Inc (OTCMKTS: MJNA) has taken a significant hit after a phenomenal start to the new year. The stock is down by more than 10% for the year, even on the broader cannabis sector turning bullish. The slide comes on the heels of the company reiterating strong growth in 2018 depicted by robust revenue growth.
Medical Marijuana Price Analysis
The stock is currently languishing at all-time lows having felt the full wrath of short sellers over the past 12 months. A 50%-plus plunge from 2018 highs sums up the stock’s underperformance even on the company showing signs of improved operational efficiency.
Revenue growth is not the only development that affirms why Medical Marijuana deserves a higher valuation. In the recent past, the Company’s subsidiaries have achieved significant milestones right from expanding product lines to set foot into new markets.
For starters, Phyto Animal Health is fresh from adding HempBone Smoked Salmon Bites further diversifying its product line. Medical Marijuana’s investment company AXIM Biotechnologies has also inked a strategic partnership with CRO to commence clinical studies on CBD chewing gums.
The confirmation that Medical Marijuana subsidiary HempMeds has secured 100 new retail locations is another development that affirms accelerated sales growth prospects. Amidst the flurry of positive developments, the stock has continued to edge lower in the market.
The stock is currently languishing at the $0.05 handle engulfed in a long-term bear trend. While price action indicates a further slide could be in the offing, a rally past the $0.07 level should reaffirm bounce back talk.
It is from the $0.07 level that Medical Marijuana rallied, late last year, after coming under immense short selling pressure.
What Does Medical Marijuana Do?
Medical Marijuana bills itself as an investment company with operations in the medical marijuana and industrial hemp markets. The company also owns a range of patented and proprietary cannabinoid products as well as high-value extracts manufactured and formulated for the pharmaceutical and cosmeceutical industries.
Sales Growth Boost
Amidst the underperformance in the stock market, one cannot dispute the fact that Medical Marijuana is in a phase of robust growth. A 125% year-over-year increase in revenues signals a company firing on all cylinders when it comes to operational efficiency as well as sales growth.
Thanks to strong growth in 2018, the company generated revenues of $59.8 million. Quarterly revenue for Q4 was up 87%, year-over-year to $17.7 million. Revenue growth looks set to be the order of the day going forward.
“The Company and its subsidiaries have worked very hard to further international access to CBD last year, and we’re optimistic that its expansion into Europe and Latin America has positioned the company to accomplish significant revenue milestones in 2019,” said Medical Marijuana, Inc. COO Blake Schroeder.
Expanding Retail Network
The Company’s subsidiary securing deals for 100 new retail locations should go a long way in strengthening sales channels, expected to support further revenue growth. Vim N Vigor, the largest retailer in Hawaii has agreed to carry Medical Marijuana’s oral, topical and edible products.
In addition to pursuing retail locations to strengthen sales channels, Medical Marijuana has also continued to strengthen its products line with the launch of new CBD products.
Phyto Animal Health one of Medical Marijuana subsidiary has unveiled a new set of CBD pet products to take advantage of a growing demand for such products in the market. HempBone Smoked Salmon Bote is the latest addition that pets can enjoy to achieve overall wellness.
“There is currently an upward trend in the CBD pet supplement industry and for good reason,” said Medical Marijuana, Inc. CEO Dr. Stuart Titus. “Phyto Animal Health leads this industry trend with premium quality, veterinarian-recommended CBD supplements in a variety of options that are customized to meet the needs of pets of many different sizes and species.”
Medical Marijuana finds itself in a precarious position after losing a substantial amount of market value over the past 12 months. While the underperformance is a point of concern, it does not paint an accurate picture of the company’s long-term prospects in view of recent developments.
Revenue growth, product line expansion, as well as the strengthening of the retail network, are developments that affirm the company’s long-term prospects. That said Medical Marijuana could bounce back from current lows on an uptick in market sentiments.
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Disclosure: We have no position in MJNA and have not been compensated for this article.