MedReleaf Corp (OTCMKTS:MEDFF) Just Doubled Its Billion-Dollar Market Cap

During our last review, of MedReleaf Corp (OTCMKTS:MEDFF), the company’s share price had just soared above the $10 mark to close the period at $13.13.By then, the company had been hailed as being among the few billion-dollar enterprises within the cannabis sector. Our review spoke to the expected growth trend holding course as MEDFF kept rising the ranks within the cannabis sector.We were right.News in this week has shown that for the first time since inception MedReleaf Corp has just surpassed the $2 billion market capitalization mark. With a share price of $22, the company has risen beyond the expectations of many and is now making its history, one that is cast in the minds of their investors. This especially holds true given that the investors at MEDFF have been trading their shares in high volumes with the number of shares traded averaging at roughly 1 million over the past few weeks.Readers can view the uptrend in the company’s price in the graph below: MEDFF Daily ChartUpon this backdrop, we have opted to take another look at MEDFF and establish the drivers behind such a high market valuation as well. This piece will, however, bring a macro perspective as we will mainly be looking at how the industry has been affecting this valuation and tying this to how MEDFF’s past decisions have benefited from growth in the cannabis space.History of MEDFFBefore then, however, let us first have a brief on the company for the sake of first-time readers.MedReleaf Corp was incorporated back in 2013 in Markham, Canada. It prides itself on being the first and only ICH-GMP and ISO 9001 certified cannabis producer in North America. Moreover, 90% client satisfaction is one of the highest in the industry.The company is a research and development company which provides a wide range of research initiatives within the cannabis space.Being the first and only ICH-GMP and ISO 9001 certified cannabis producer in North America, MedReleaf Corp prides itself on being an R&D company providing a wide range of research initiatives within the cannabis space. This has been enabled by the many years of data collection and active client profiles that have been integrated to allow services tailored to their clients’ needs.The company’s primary goal is to ensure their entry into the beverage and consumer products industry. Through this, they will diversify their product line and expand their revenue stream. Furthermore, their entry into international territory, despite costing them in the short term, is bound to pay off long into the future as they reap the benefits of globalization.Return DriversDuring our last analysis of the company, we defined how the company is working towards expansion. This encompassed both capital expenditures and their well-known geographical expansion strategy.Through their capital expansion strategy, the management of the company is working at growing their output in a bid to ensure their supply is adequate to feed their ever-increasing demand. With the 7,000 kilograms per annum not being sufficient to fill their market, the company is currently working at increasing this output folds over.Their new facility is going to increase this number to 28,000 kilograms a year, a number which the company believes will be adequate in the short term. However, given that they are working towards international expansion into Brazil, Mexico, and Australia, further development will need to be in the company’s plans.The Industry and MEDFFMEDFF is currently benefiting from being in the cannabis industry.The cannabis industry is already in the take-off phase. Are not only many states and countries legalizing both recreational and medicinal cannabis, but also organizations such as the World Anti-Doping Agency, are all creating new revenue streams for cannabis players.Currently, cannabis players are working hard to ensure that they are well positioned within the sector to reap full benefits and MedReleaf Corp, as shown previously in this piece, has not been left behind.Through the geographical and capital expansions, the company is expected to reap maximum benefit from its operations. Furthermore, their bid to venture into the beverage segment, as has been seen with larger firms such as Constellations Brands investment in Canopy Growth Corp, is deemed by the market to be the way forward for the sector.The above goes to explain why the share price of MEDFF is on the rise.The market is assigning a premium to many of the cannabis stocks courtesy of the expected growth within the sector. However, with companies that have such an aggressive expansion strategy, an additional premium is attached. Therefore, the MEDFF share price, in our view, is far from coming back down.We, therefore, retain our initial outlook, MEDFF is bound to grow, and their current trend is not about to stop.ConclusionMEDFF has just doubled its valuation within one month. We expect that this trend will hold long into the future and that a tripling of their valuation to $3 billion is about to be achieved. We remain bullish about the company.We will be updating our subscribers as soon as we know more. For the latest updates on MEDFF, sign up below!Disclosure: We have no position in MEDFF and have not been compensated for this article.