I have maintained a long thesis on 48North Cannabis Corporation since October 2018, and the trade worked wonderfully into March of last year. However, 48North pulled back alongside the entire cannabis sector, and rightfully so on some of their own missteps.
As a brief introduction, I believe 48North's competitive advantage stems from their outdoor grow operation, creating a low cost of goods operating model that will enable 48North to price products competitively and reward investors with higher gross margin performance when compared against the peer group. It should be noted that 48North missed their production guidance for 2019- resulting from delayed licensing for drying rooms. In 2019 48North demonstrated that outdoor grown cannabis can be completed at scale, at a low cost, and successfully pass Health Canada's quality control standards.
From a chart perspective I'm considering the Elliott Wave ABC pattern to be completed with a clean retracement & double bottom at $0.315 - neatly correlating with the 161.8 fib extension of Wave A
It is my opinion that 48North's cash position reduces the need for any capital injection through 2020. Frankly- it is going to be in the hands of 48North to demonstrate in 2020 that they truly can achieve their projected outdoor harvest numbers with drying capacity not being a barrier in 2020.
Comment
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Excellent progression to kick the week of on 48 North Cannabis Corporation. New insider filing this morning for Alain D- great to see names beyond Pierre Calland painting the insider transactions.
Price action now looks to be heading into the 0.425 gap fill territory on the daily time frame.
Excellent progression to kick the week of on 48 North Cannabis Corporation.
New insider filing this morning for Alain D- great to see names beyond Pierre Calland painting the insider transactions.
Price action now looks to be heading into the 0.425 gap fill territory on the daily time frame.
Volume is confirming strength behind the move.
s_chevrier
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TtT - Nice to see you here! Following along!
tomthetrader1
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@s_chevrier, Trying out the platform- feels like a cleaner way to follow a chart with periodic updates all in one place. Will likely fully transition here
ivanbtaras
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Hey Tom, welcome to TV!
tomthetrader1
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@ivanbtaras, Hey! Good to see you here! Making a switch to TV to track my charting. I love my broker and all they offer, but this charting platform is wonderful & allows me to keep my notes all in one place.
pabloppicaso
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It was an EPIC miss of their production guidance, but Alison did a great job misleading and keeping retail investors totally in the dark for as long as she could.
Nice to see you hear though Tom, and I continue to hold on to my many NRTH shares strickly because of their super low PB ratio of .66 as of this moment.
I wonder what their current "Cash on Hand" is. The 40M you refer to was at the end of Sept. Love to know their burn rate over the following 3 and a half months.
We'll have to wait until the end of Feb to see that.
Cheers
tomthetrader1
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@pabloppicaso, I don't blame Alison- however mistakes were made and increased transparency would have been well received then. I can't imagine navigating the public environment from her position. If it truly did come down to the drying room licensing- this should be a moot point for 2020. That said, the proof will be in the 2020 harvest numbers. The cash burn rate compared to peers is responsible- I am hopeful with capital more difficult to access they are keeping a close watch on spend
pabloppicaso
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@tomthetrader1, No worries. I personally believe that this was an avoidable event (the drying room licensing) with proper planning and foresite. Something the NRTH CEO did not have. It cost the company many millions. So I guess we'll agree to disagree regarding Alison.
New insider filing this morning for Alain D- great to see names beyond Pierre Calland painting the insider transactions.
Price action now looks to be heading into the 0.425 gap fill territory on the daily time frame.
Volume is confirming strength behind the move.