Shares of Two Rivers Water and Farming (OTCMKTS: TURV) are pulling lower after a 200% plus spike to all-time highs. The massive surge came on the Company announcing plans to acquire a string of hemp-focused companies as part of its growth strategy.
OTCMKTS: TURV Price Analysis
Delays in the closing of the deals appear to have rattled investors, consequently triggering a sell-off of the stock. The pullback could as well be a minor correction pending further upside action. The fact that the company is still in discussions as it eyes deals for three crucial hemp companies affirms long-term prospects.
The acquisition is part of Two Rivers Water & Farming plan of repositioning itself to pursue growth on seed to sale hemp farming. The acquisition should also strengthen the Company’s growth metrics in the multi-billion hemp industry.
In addition, the Company has inked deals with two accredited investors who have agreed to provide a net of $480,000 in short term working capital. The financing should strengthen the company’s financial capacity as it eyes strategic initiatives for accelerating growth.
The stock has since pulled lower and back to critical support at the $0.30 level. Above the support level, the stock remains bullish and likely to continue edging higher as a pullback play. A breach of the $0.30 support level could trigger accelerated short selling pressure that could see Two Rivers Water & Farming tanking lower back to the $0.20 level.
Two Rivers Water & Farming Background
Two Rivers Water & Farming is a company focused on the development and redevelopment of infrastructure used for water management and delivery. The Company acquires water assets by acquiring land with senior water rights.
Hemp Sector Expansion
Early this year Two Rivers Water & Farming confirmed plans to acquire Vaxa Global, Ekstrak Labs LLC, and Gramz Holdings. With the acquisition, the company was to gain a head start into the lucrative hemp business by expanding its footprint into the Western United States.
The Company announcing delays on the closing of the merger agreements is the latest headwind that continues to affect the stock’s sentiments in the market. The mergers were poised to close before June 1, 2019. However, with the delays, Two Rivers Water & Farming expects the deal to close not later than July 31, 2019.
Amidst the delays, Two Rivers Water & Farming remains positioned to generate significant value in the cannabis sector with the acquisition of the three companies. For starters, the company plans to venture into the seed to sell hemp farming business. Plans are also underway to launch CBD extraction operations that should pave the way for the development of consumer products businesses.
“Vaxa, Ekstrak, and Gramz are expanding into the Western United States. Vaxa is planning to grow hemp on land owned and water supplied by Two Rivers. Ekstrak is the lab and extraction facilities. Gramz provides end-user products. Taken as a whole, we are one of the few companies that plan to be vertically integrated in the hemp space – from seed to products,” commented Wayne Harding, Chief Executive Officer of Two Rivers.
The merger should position the combined entities for long-term growth in the vertical cannabis market. By combining forces, the Companies should be able to expand their footprint into the health beverage and natural foods segment.
Two Rivers Water & Farming has since inked a deal with two accredited investors that paves the way for it to gain access to $480,000 in short term working capital. The Company intends to use part of the funds to pay certain debts and for working capital ahead of the announced merger with Ekstrak Labs, Vaxa Global and Gramz Holdings.
“Two Rivers is focused on its long-term business goals of using its acquired land and water right in multiple business verticals that will generate a stable and predictable investment cash flow for expansion of the business. We will continue to work on the completion and integration of the Acquired Companies for hemp production, along with other initiatives we have,” stated Mr. Harding.
While Two Rivers Water & Farming has taken a significant hit in recent weeks, its long-term prospects remain intact as ever. The acquisition of three hemp-focused businesses is a milestone that should strengthen the company’s bottom line, given the expected expansion into a sector with vast opportunities for growth.
The recent pullback, in our view, appears to be a minor correction from where the stock is likely to power higher once the Company finalizes a merger with the three hemp businesses.
We will be updating our subscribers as soon as we know more. For the latest updates on OTCMKTS: TURV, sign up below!
Disclosure: We have no position in OTCMKTS: TURV and have not been compensated for this article.