Did you see what happened to the share price of MYM NUTRACEUTICALS (OTCMKTS:MYMMF)?
We know we have.
The company whose share price has been on an upward rally has been the talk of town with it being listed among companies that made the highest return this week. This, however, is not just a one-week affair.
During our last piece on the company (published back in July), their share price stood at $.471. Back then, our forecasts held that their price would go even higher, however, its current price has gone as far as surprising us too.
For first time readers, this article can be obtained here.
Their share price has been trending since then, as can be seen in the chart below, and the company is now trading just shy of $2, a 300% jump since we first covered the stock.
With such movements being exhibited, we also felt compelled to have a closer look at the company so as to see what the drivers for such a price surge would be.
In this case, this will entail a look at their history, current and future projects as well as their financial statements, all with the aim of ensuring readers have a comprehensive look into the company and its value drivers. Thence, our opinion of the company, having been shaped by the latter, will be given. Readers should thus expect a great read going forward.
However, before diving into the topic at hand, let’s first have an overview of MYMMF for the sake of first time readers.
MYMMF: A Look Into Who We Are
Founded in 2014 and with headquarters in Vancouver, Canada, MYM Nutraceuticals Inc.’s primary focus was developing high-end organic medicinal marijuana supplements and topical products, a vision which they have held on to to date.
MYM also has an interest in the development of high-density farming facilities and technologies that allow MYM to expand its brand into the global market.
All the above have led the company to acquire three subsidiaries: Sublime Culture Inc, HempMeds PX, LLC and CannaCanada Inc, all which have helped the company work towards achieving their operational and strategic objectives both within Canada and globally.
The company has been furthering its quest for growth over the recent past with projects and partnerships that span different continents. Information from them on the on-goings of these projects has been very positive and will be the topic of discussion in the next section.
MYMMF: Working Towards Growth
Back in July, as can be read in the previous article, the company’s main story was the signing of a deal with the Municipal of Weedon, Quebec allowing them to set up a 1.5 million square foot project: fifteen greenhouses occupying 100,000 square feet each, one of the largest in the world.
The deal which was the first of its kind in the world gave MYMMF the ability to produce about 150,000 kilograms of cannabis annually; 750 million in revenues annually. This was to be done through their subsidiary, CannaCanada Inc which was then 75% controlled by MYMMF and expected to be 90% owned by the completion of the project. All these was to be financed by share issues.
Since then, the company has made even greater strides towards ensuring their projects and revenue streams going forward do not stop there.
They began by entering a consulting agreement with Master Grower, Zachary Tietolman. The deal which is meant to ensure that Zachary provides services essential to the production and management processes of MYMMF’s projects will see MYMMF work with one of the best in the industry and thus boost their yields. The end game for them is for yields to go up as they work towards growing their outreach into other countries and projects.
Building on the latter, a move to venture into Australia followed swiftly.
The company partnered with PUF Ventures Inc that would enable them build a 1 million square-foot greenhouse facility in New South Wales, Australia.
The project dubbed the Northern Rivers Project (quite similar to the previous project) will see MYM own 35%. The greenhouse once completed will produce about 100,000 kilograms of cannabis worth between C$800 million and C$1.1 billion.
That’s not all.
With the growth in the acceptance of cannabis across the globe, the 24 million people in Australia present a great market for MYMMF if recreational cannabis is legalized in the country with the market expected to grow to C$9 billion in 7 years if this happens.
This news must have been the reason the market was in a frenzy causing the traded shares of MYMMF to almost cross the 1 million mark.
Having analyzed all this, let’s further assess how their financials have been performing so far.
Past Financial Performance
Their financial performance doesn’t deviate from the rest of the piece, the company has produced record performance in the second quarter.
For the first time, the company made revenues, generating $280,448 in revenues and $186,282 in gross profits. This was no mean feat for the company which had no revenues until now.
They, however, had high operating expenses that led to them making losses. Despite this, some of these expenses were pivotal to their revenue position and remain pivotal to their future operations. Expenses such as marketing and consulting and professional services which stood at $117,246 and $60,442 have a greater effect on their long-term cash flows and earnings thus warranting them.
The company also has a working capital base of $512,741 which management stipulates will be used to finance operating activities going forward.
This, was not all.
During the second quarter, they raised over $990,000 through private placements. In the third quarter, they have raised a further $2.8 million and 385,00 from share issues done in two tranches, money which will be used to fund their expansion activities has enabled the company create a large financial base from which growth can be financed.
All these speak to the company’s strength and ability to grow going forward. We believe that the above show both that MYMMF has been growing in the short term and is further poised to grow in the long run. Our view, similar to the view in our previous article, stands. MYMMF is a stock bound for growth.
MYMMF represents one of the success stories in the market. The entity has invested heavily in a lucrative sector and is poised for success given their current financial path as well as global expansion projects. Investment in the firm would be a step into future growth of the investor’s portfolio.
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Disclosure: We have no position in MYMMF and have not been compensated for this article.