Village Farms stock
Cannabis

Is Village Farms Stock (NASDAQ:VFF) A Smart Cannabis Play?

Pot stocks are finally rallying again and this has investors excited that the long bear market is finally over. Cannabis investors are now scanning the markets looking for which marijuana plays are best positioned to capitalize. One name that keeps popping up on the radar is Village Farms Stock (NASDAQ:VFF).

Village Farms Stock Daily Chart

Village Farms Stock rallied more than 22% just before the Memorial Day weekend. Shares have now more than doubled off the lows. Taking a closer look, there’s a lot to like with Village Farms stock. Some highlights of why to be long Village Farms stock include:

actually profitable with other farming products contributing
reasonable P/E and P/EBITDA and P/S
already growing good quantities
ultra low cost $0.65/gram already (will decrease with addition of outdoor growing acreage)
good acreage
does outdoor and indoor growing
facilities in place
has branded products
has access to US market in multiple states
has access to Canadian market

About Village Farms Stock

First up, here’s a little background info for those of you that aren’t familiar with Village Farms stock. Village Farms is one of the largest and longest-operating vertically integrated greenhouse growers in North America and the only publicly traded greenhouse produce company in Canada. Village Farms produces and distributes fresh, premium-quality produce with consistency 365 days a year to national grocers in the U.S. and Canada from more than nine million square feet of Controlled Environment Agriculture (CEA) greenhouses in British Columbia and Texas, as well as from its partner greenhouses in British ColumbiaOntario and Mexico.

The Company is now leveraging its 30 years of experience as a vertically integrated grower for the rapidly emerging global cannabis opportunity through its majority ownership of British Columbia-based Pure Sunfarms Corp., one of the single largest cannabis growing operations in the world. The Company also intends to pursue opportunities to become a vertically integrated leader in the U.S. hemp-derived CBD market, subject to compliance with all applicable U.S. federal and state laws, Village Farms has established two joint ventures, Village Fields Hemp and Arkansas Valley Green and Gold Hemp, for outdoor hemp cultivation and CBD extraction and is pursuing controlled environment hemp production at a portion of its Texas greenhouse operations, which total 5.7 million square feet of production area.

Latest news from Village Farms

Pure Sunfarms just received from Health Canada its cannabis cultivation sales licence based on an initial production area within its second 1.1 million square foot greenhouse facility in Delta, British Columbia, allowing it to expand capacity as needed through successive license amendments. The Delta 2 facility is located adjacent to the 1.1 million square foot Delta 3 greenhouse facility and when in production, is expected to contribute to further lowering Pure Sunfarms’ already industry leading cost of cultivation.

Pure Sunfarms is also now preparing to begin the roll out of its first bottled cannabis oils, as well as its first Cannabis 2.0 offerings this summer. Pure Sunfarms’ Cannabis 2.0 roll out will begin with the launch of a selection of pre-filled 510 vape cartridges, available in the extract forms of its top-selling1 dried cannabis strains, as well as a selection of disposable vape pens – all under the highly regarded and well trusted Pure Sunfarms brand.

Bullish Cannabis News

Last week, Statistics Canada reported that cannabis sales skyrocketed in March. Bank of America also came out with a Buy rating on industry giant Canopy Growth Corp (NYSE:CGC). In addition, the NY Post was out with a story that a team of Canadian scientists believes it has found strong strains of cannabis that could help prevent or treat coronavirus infections. All of this has contributed to the bullish enthusiasm surrounding the pot sector.

Bottom Line

Currently trading with a market cap of just $292 million, Village Farms stock trades at just 2.02x sales and 2.11x book value. With 7.46% of the float short, we expect the rally in Village Farms stock to continue as the shorts cover and new buyers come in looking for hot pot stocks to own. With its small market cap and NASDAQ listing, Village Farms is one name that cannabis investors must own.

Good luck to all (except the shorts)!

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Disclosure: We have no position in NASDAQ:VFF or NYSE:CGC and have not been compensated for this article.

Image by David Cardinez from Pixabay

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Is Village Farms Stock (NASDAQ:VFF) A Smart Cannabis Play?
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