There Is Nothing Stopping Takeoff For This Rocket: EMERALD HEALTH THE (OTCMKTS:EMHTF)

As is common knowledge now, the expected recreational legalization of cannabis in Canada has been the talk of town and has also made a few investors quite some money. With a few companies investing top-dollar in this field, the return from this investment has been quite splendid for them.Be though this the case, very few companies can boast an investment as high nor an outlook as bright as EMERALD HEALTH THE (OTCMKTS:EMHTF).The company which has put in a lot of thought into their investment (as will be seen in our analysis) as well as in the management of their books has been growing significantly over the years and is now about to experience its long-awaited takeoff moment.Their most recent share price rally is only a reflection of this.The company’s share price has been on an upward trend since September with their price rising from just over $1 to close yesterday at $2.26, an over 100% jump as can be seen in the chart below: EMHTF Daily ChartIt is upon this backdrop that we have opted to look into EMHTF as we try to assess the reasons behind such a price surge as well as what value creation activities that have been engaged in until now.Before we go deeper into this analysis, however, we find it prudent to get a general overview of the company for the sake of first time readers.EMHTF Then and NowFounded in 2007 and incorporated in Victoria, Canada, Emerald Health Therapeutics is a licensed producer of medical marijuana under the Access to Cannabis for Medical Purposes Regulations.The company was initially formed with the goal of venturing into the medical cannabis industry which was caused by the legalization of medical cannabis in Canada. However, they are currently working towards ensuring that they become major players within the industry both in Canada and globally especially with the legalization of recreational cannabis in Canada.They have done a lot in a bid to become as great as has been expressed above. These efforts are assessed below.Developments and SuccessesA recent report by Deloitte showed that the demand for cannabis is Canada will soon outweigh the supply.The report which valued the cannabis industry in Canada at $22.6 billion went further to show how this was going to be possible: they forecast the demand side to stand at 610,000 kilograms per annum while the supply side would stand at 422,000 kilograms per annum, an over 188,000-kilogram deficit, all by 2019.EMHTF has seen into the future and taken this up as a challenge.With the help of their competent management led by Dr. Avtar Dhillon, a man who saw the transition of Inovio Pharmaceuticals from a $10 million micro-cap company to a $550 million late-science biotechnology company, their business operations are being augmented to fit this production deficit.The company has since October gotten itself deals that have secured its position on the charts of the cannabis industry both in Canada and globally. They began by entering a partnership agreement with Village Farms for their 1.1 million square-foot greenhouse facility located in Delta, British Columbia. Moreover, this is only a short-term play as they work towards an additional 3.7 million square-foot facility within the same complex going forward.All in all, EMHTF is targeting a total of 5.8 million square feet in space to enable them expand their operations. This $10 million project, which will go to their books as one of the most capital-intensive projects they have undertaken so far, is expected to yield about 350,000 kilograms of cannabis per annum upon completion, an amount in excess of the above stated deficit.This only goes to show how much foresight has gone into the operations as well as the strategic plans of the company. With such high output already accounted for, the company has gone further to ensure that they cover the entire spectrum in the value chain by venturing into the distribution of cannabis.This happened towards the end of October when they got into a deal to acquire Northern Vine for an investment of $2.5 million, about 53% of their shares, thus giving them controlling interests in Northern Vine.Northern Vine is a licensed dealer, giving them the capacity to carry out research and development, import and export cannabis products, and related activities. the best part is that they can not only import and export dried products but also cannabis oils, a factor which ties with the strategic objectives of EMHTF.All the above have been achieved within a one-month timeframe, no mean feat for the company. They are a symbol of the success that can come from positioning themselves within a growing industry as well as working your way to success within it.Their foresight is impeccable and going forward, their only limitation would be poor financial management.FinancialsThe company has been growing their revenues constantly over the quarter ended June 2017 with their most recent revenues standing at $189,000. This is a 26% jump from the previous period where they recorded $150,000 in revenues.Despite netting in a loss, their current activities such as a growing research and development cost seem to be quite futuristic and bound to pay off eventually. Moreover, these have been funded by additional share capital which the company issued over this quarter, issuing a total of over $20 million in the quarter ended June 2017 and over $10 million in the previous quarter.The market thus seems quite optimistic about the future of EMHTF and so are we. Such growth and foresight is unlike that seen in most companies and is therefore bound to pay off quite soon for them.ConclusionEMHTF represents one of the success stories in the market. Their investment in a growing sector as well as the foresight seen upon analyzing their decisions is nothing short of impeccable. With the right operations and management, the company is poised to be a dominant player in the sector quite soon.We will be updating our subscribers as soon as we know more. For the latest updates on EMHTF, sign up below!Disclosure: We have no position in EMHTF and have not been compensated for this article.