Because the articles are written or sanctioned by Christopher Netelkos, a recognized authority that backed his words with honest assessments. Mr. Netelkos is considered an expert on strategic planning, published and lectured on over 125 technical reports, procedural papers and news articles related directly to cannabis and hemp. A sample of articles written in 2018 offer sufficient “distance” to gauge his insight into the evolving and confusion industry.
Nationally presented and syndicated articles by Christopher Netelkos, Vice President, Northridge Corporation.
... from the samples of a few stories published, the themes are the same. Cannabis and hemp investments, whether private or public, requires a sound business model or failure is guaranteed. Northridge Corporation has the Business Model that can succeed, grounded on principles expressed in his articles and lectures. 1/
Consider the sampling of the articles from the perspective of publicly owned of cannabis or hemp investments, because the results are a mirror image of the unprecedented losses taking place today in the industry. Case in point: If you invested $100,000 in public trading cannabis or hemp companies on March 26, 2018, on average, today your investment has a liquidation value worth $14,600, representing a loss of $85,400. This statement is not presented to prevent cannabis or hemp investments, only to demonstrate that with proper fundamentals and sound business practices based on facts and market conclusions, which are more in line with fundamentals and reality, not investment bankers and the other kind with their "experts" fantasies.
News stories presented.
FOCUSING ON THE LONG-TERM VIEW
March 26, 2018: From a spectrum of probabilities, the curious investor may have a unique starting point to determine the true potential of the recreational cannabis market. Finding the proper path would reduce the investment risk and offer a once-in-a-lifetime opportunity for significant financial success. A mistake in the assessment promises unequivocal failure.
PUBLIC TRADING COMPANIES UNDER CAPITALIZED
March 16, 2018: Public funding of the commercial cannabis market has produced ineffective results. The issue is the questionable dynamics caused by the federal government’s reluctance to remove cannabis as a Schedule I and Schedule II Controlled Substance and amend Section 280E of the Internal Revenue Service Code …. such companies are unable to present a conventional business plan to attract permanent capital. Without a unified financial structured corporate funding cannot be fully achieved. ... U.S. based public companies undercapitalized and face financial risk of extinction: Medical Marijuana, Inc. (MJNA,) Cannabis Sativa, Inc. CBDS., Cannabis Sciences Inc. (CBIS) CannaGrow Holdings, Inc. (CGRW) , Unitedd Cannabis Corporation (CNAB), VAPE Holdings Inc. , Surna Inc. (SRNA), American Cannabis Company, Inc. (AMMJ), MedCareers Group, Inc. (MCGI), General Cannabis Corp. (CANN), MassRoots, Inc. (MSRT)
Today they are either out of business or face extinction.
THE NEXT BIG THING
April 15, 2018: How many times have investors heard the phrase? .... Usually, the hype for a stock is just that --- flimflam! A “pump and dump” affair to trap the little guy while allowing a few insiders to reap the rewards. Failure for the less informed is inevitable because the promoter has an extremely short-time horizon and personal intent to win any way possible; illegal or otherwise. Meanwhile, simple investors buy-in on expectations for the “next big thing” only to be frustrated with a capital loss.
ARE YOU READY? *
September 23, 2018: "Careful and persistent as a tortoise with the spunk of a hare allows you to go the distance. In business, steps missed lead to success or failure. Nothing happens until the objective is identified. To win, it’s never the speed or the distance. Patients, diligence, knowledge and timely executions, are the disciplines." by Christopher Netelkos. * courtesy of First Jersey Cannabis Corporation.
GREEN RUSH OR IS IT FOOLS GOLD RUSH? *
October 19, 2018: In Canada, speculators have billions of dollars on the line believing that mining green marijuana gold 1/ is a win-win situation. At the epicenter is public policy that will be dictated, dissected, analyzed, and second-guessed by both sides of the marijuana equation. The process will create market swings possibly experienced only once before. The time was February 1637 when the Dutch Golden Age created the “tulip mania.” Lowly flower bulbs worth less than a nickel apiece sold for tens of thousands of dollars and then dramatically collapsed. In hindsight, who would buy a single tulip bulb for $25,000? Many did on the belief that higher prices were around the corner. That insanity certainly is alive today. * courtesy of First Jersey Cannabis Corporation.
TLRY IN TROUBLE
November 12, 2018: part 2 .... CANADA INVESTMENT SERIES --- Tilray, Inc. (TLRY) 109.54+0.55 (+0.51%). TLRY will release its earnings on November 13th after the market closes. With its market capitalization at $10.22 billion and extremely negative forward earnings projections, TLRY is not ready for prime time. Yes, FJC’s commentaries suggested a BUY in the $30 range and to “SELL at the market” when the stock hit $300 was a great conclusion, which was based exclusively on momentum. (see commentaries) After the noise has settled, on a value basis TLRY is worth $45 a share -- a reduction from our previous price range of $75. The issue is valuation and its ability to raise more cash to support operations. With TLRY focusing on growing the stuff as “farmers” and the focus on pharmaceuticals, the company’s business model lacks substance to grow the bottom line. Earnings per year are the name of the game, and TLRY will not hit the black marker until 2025, if at all.
Brendan Kennedy, CEO of TLRY has been talking the talk with more noise than substance, claiming that marijuana companies can hit a $100 billion valuations with a $150 billion global cannabis industry. Never will happen with the current business model of most cannabis companies. The numbers speak for themselves: Book value below $1.00 per share, 78 million shares outstanding with a 10 million share float suggests stock liquidity is marginal at best and the company's demands for more capital, the dilution factor will create weaker stock prices. Without true earnings in sight, TLRY looks like a giant wave about to collapse.
As of October 10, 2019 TRTY is trading at $20.99.
BIG SPIN ---Aurora Cannabis Fools Investors. *
November 16, 2018: ACB Q1 Report less than honest.
The green rush is in full swing in our neighbor to the north. Just under a month ago, Canada lifted the curtain on nine decades of recreational marijuana prohibition and opened its doors to the fast-paced cannabis industry. When entirely up to speed, Canadian pot stocks are expected to benefit from about $5 billion in added annual sales. … Now, with adult-use weed legal, all eyes have turned to marijuana stocks for tangible results. After all, before legalization, it was a race to see which pot stock could promise the most production or forge the highest number of supply deals. Now we find out whether or not marijuana stocks can deliver on their lofty goals…..BOTTOM LINE: As stated in previous articles, Aurora Cannabis’ business model is flawed. ACB has a significant cash drain and more acquisitions to hide its mistakes exacerbate the negative trend. Bullish shit talks, money walks --- don't play the fool's game. * courtesy of First Jersey Cannabis Corporation.
CANNABIS INVESTMENTS ARE BIG LOSERS *
December 19, 2018: Show me a good and gracious loser, and I’ll show you a failure.” Now for the rest of the story. .... Earnings matter now, which is terrible news. For starters, operating results matter now that cannabis is legal in Canada, and that's not necessarily a good thing for an industry that's thrived on promises to expand capacity, grow product portfolios, and forge partnerships. With the need to deliver on the bottom line, many pot stocks will likely disappoint Wall Street and investors. For example, Canopy Growth (NYSE: CGC) is widely viewed as the premier cannabis name on Wall Street. ... * courtesy of First Jersey Cannabis Corporation.
TRUTH ABOUT $160 MILLION ACQUISITION
December 6, 2018: … overpriced and over baked. ... Acreage Holdings, Inc. (CSE: ACRG.U) and Form Factory, Inc. ("Form Factory"), a multi-state manufacturer and distributor of cannabis-based edibles and beverages, announced they had signed a definitive agreement for Acreage to acquire Form Factory, in an all-stock transaction valued at US$160 million.
December 5, 2018: On December 3, 2018, we presented WORTHLESS CANNABIS INVESTMENTS on our Cannabis News pages, which claimed that one of the ten worst public cannabis-based companies, Cronos Group Inc. (CRON) ranked number 6 on our list. ... CRON closed at $10.58 with a market capitalization of $982.7 million and less than $10 million in sales sported a low DG rating of 4. In essence, CRON cannot survive as a cultivator. The Game Changer is the talks with Altria Group, Inc. (MO) $54.46.
As of October 10, 2019, the stocks on average are down 45%.
WORTHLESS CANNABIS INVESTMENTS *
December 3, 2018: The ratings of the biggest publicly traded cannabis stocks based on market capitalization and flawed business models. ...1. Canopy Growth Corp: $4.36 billion - DG 5 rating. Canopy Growth Corp. (NYSE: CGC). Canopy currently has seven grow facilities spread across 665,000 square feet, and it is in the process of developing greenhouses on 3.7 million square feet of land in British Columbia. Though tight-lipped about its annual production capacity, it could easily top 300,000 kilograms of dried cannabis. $35.18 $20.94 * courtesy of First Jersey Cannabis Corporation.
2. Aurora Cannabis: $3.47 billion - DG 5 rating. Aurora Cannabis (NYSE: ACB) - After acquiring CanniMed Therapeutics in the largest marijuana acquisition in history, the company is on track for 283,000 kilograms in fully-funded, fully ramped-up, annual production. The bulk of Aurora's annual yield comes from its organically built Aurora Sky project, which should yield over 100,000 kilograms annually, as well as its partnered Aurora Nordic project in Denmark, which is expected to produce at least 120,000 kilograms of cannabis a year. Aurora's state-of-the-art facilities should boast some of the lowest per-gram costs in the industry. $5.97 $3.88
3. GW Pharmaceuticals: $3.13 billion - DG 3 rating. Regarding cannabinoid-based drug developers, GW Pharmaceuticals (NASDAQ: GWPH) is a cannabinoid-based drug developer. Though it already has an approved drug throughout Europe known as Sativex, GW Pharmaceuticals' claim to fame looks to be experimental drug Epidiolex, a cannabidiol-based drug that's currently under review by the Food and Drug Administration (FDA) for use in the treatment of two rare forms of childhood-onset epilepsy. In two pivotal-stage trials each for the Dravet syndrome and Lennox-Gastaut syndrome -- neither of which have an FDA-approved treatment -- Epidiolex handily met the primary endpoint of a statistically significant reduction in seizure frequency from baseline. Though estimates vary, peak annual sales may top $500 million, if approved.$127.78 $115.82
4. Aphria: $1.39 billion - DG 5 rating. Aphria (NASDAQOTH: APHQF) is yet another Canadian-based grower with a billion-dollar valuation. Following the acquisition of Nuuvera, the new Aphria is on track to produce approximately 230,000 kilograms of cannabis a year. This includes a four-phase expansion project that should yield 100,000 kilograms, along with a strategic partnership with Double Diamond Farms that'll produce 120,000 kilograms. The acquisition of Nuuvera didn't boost Aphria's annual production targets. However, it did push Aphria's access up to a dozen countries, including Canada. In other words, its Nuuvera buyout was a major step forward for the company's distribution channel.
5. MedReleaf: $1.23 billion - DG 4 rating. MedReleaf (NASDAQOTH: MEDFF), a grower that has historically placed a strong emphasis on cannabis oil and extract production. Even though MedReleaf is only forecast to produce 140,000 kilograms of fully-funded cannabis a year, it could produce beefier margins than its peers as a result of its strong focus on higher-margin oils and extracts. MedReleaf's recent acquisition might be it's most impressive. In a cash-and-stock deal, MedReleaf acquired 164 acres of land, 69 of which already had a growing facility (the Exeter facility) that could be retrofitted to cannabis production. Doing so, rather than building a greenhouse from the ground up, is a time- and money-saving venture.
6. Cronos Group: $982.7 million - DG 4 rating. Canadian investment firm Cronos Group (NASDAQ: CRON) made waves in late February when it became the first pot stock to up list from the over-the-counter (OTC) exchange to the Nasdaq. Doing so is expected to improve visibility and make its stock more attractive to institutional investors who would otherwise not purchase stocks listed on the OTC exchange. As for the underlying business, Cronos holds a 100% stake in cannabis growers Peace Naturals and Original BC and a 21.5% stake in Whistler Medical Marijuana. The company has smaller investments in other growers too. As is the case with practically every grower mentioned above, the expected legalization of recreational cannabis in Canada is what has pumped up Cronos' market cap.
7. Hydropothecary Corporation: $504.3 million - DG 3 rating. When it comes to truly niche operators in the cannabis space, Hydropothecary Corp. is it. The Quebec-based company, which currently prides itself on medical cannabis production, has expansion plans in the works that'll result in 1.3 million square feet of land being used to grow 108,000 kilograms of cannabis per year. But it's the company's focus on non-traditional cannabis products that have intrigued investors. Hydrotherapy has focused on expanding its extracts, oils, and powder line (known as Decarb, a ready to consume marijuana powder), as well as on premium medical marijuana strains that cost almost double the average per-gram selling rate for average-quality cannabis strains.
8. CannTrust Holdings: $473.2 million - DG 3 rating. CannTrust Holdings is currently focusing its efforts on more than 40,000 actively registered medical patients. However, as every grower noted above, it's in the midst of a major expansion. CannTrust's 430,000 square foot Niagara Greenhouse remains on track and budget to eventually produce 40,000 kilograms per year. Beyond that, the company expects to add another 600,000 square feet of capacity using a portion of the 36-acre vacant lot next to the Niagara Greenhouse. CannTrust announced in its latest quarterly results that just over 64% of its sales were a result of extracts. Extracts are a significantly higher margin product relative to dried cannabis, leading to the belief that CannTrust could offer superior margins in the future.
9. Cannabis Wheaton Income Corp.: $442.2 million - DG 3 rating. The ninth-biggest marijuana stock isn't a grower at all -- it's a royalty and streaming company known as Cannabis Wheaton Income. Since access to capital is a challenge for most pot stocks, Cannabis Wheaton steps in with the financing they need to expand capacity or their product lines. In return, Cannabis Wheaton receives a percentage of production at a below-market cost. It then turns around and sells what it receives from its licensed partners at the market rate and books the difference as a profit. Cannabis Wheaton offers immediate geographic and product-line diversity with its more than one dozen licensed partners, without the hassles of dealing with day-to-day cannabis growing expenditures. Of course, the downside is that streaming companies like Cannabis Wheaton have high initial costs, often resulting in shareholder dilution.
10. Emerald Health Therapeutics: $416.3 million - DG 5 rating. Rounding out the top 10 largest marijuana stocks is Emerald Health Therapeutics (NASDAQOTH: EMHTF). Emerald Health has big ambitions of placing itself among Canada's top growers by annual production, and it is currently in the process of building out two major projects that should push its annual yield over 100,000 kilograms. The first involves a from-scratch build-out of 1 million square feet in British Columbia that'll house the company's headquarters. The second involves a strategic partnership with Village Farms International that'll see an existing 1.1 million square foot facility get retrofitted from tomato production to dried cannabis. This latter facility is expected to produce at least 75,000 kilograms annually when complete.
……… on average their stocks have declined 74% since WORTHLESS CANNABIS INVESTMENTS article of December 3, 2018.
NOW YOU HAVE IT!
If you have any interest or curiosity about hemp or its twin, cannabis, getting a fresh view from Northridge can make a different.
1. Scalability: A business must be scalable for it to be successful. The Northridge Business Model is design with economy of scale as the primary component.
2. Big Ideas: A business is no more effective than the idea upon which it is built. The entrepreneur's vision is more important to the life of the business than anything else. The Northridge Business Model focuses on fundamentals and sound business practices to achieve maximum value for its customers, investors, employees, suppliers and management.
3. Systems: A business is a System in which all parts contribute to the success or failure of the whole. In our system, everything must work together: from employee to president; from equipment to resources. The Northridge Business Model is a system within a system, requiring full attention to detain and execution. The heart to its engine is a reliable, sustainable and continually educated employee core
4. Sustainability: A business must be dynamic--able to thrive through all economic conditions, in all markets, providing meaningful, highly differentiated results to all of its customers. Such differentiation is key to survival. The Northridge Business Model is flexible and continues to be in focus to the risks and rewards of an evolving hemp industry.
5. Growth: All businesses need internal growth. Our business is a School in which our employees are students, with the intention, will, and determination to grow. The Northridge Business Model means growth with people. Our NC Intern Program and Outreach Initiative is about us - growth from within.
6. Vision: A business must manifest the Higher Purpose upon which it was seeded, the vision it was meant to exemplify, the mission it was intended to fulfill. The Northridge Business Model is sustained profitability.
7. Purpose: A business is the fruit of a Higher Aim in the mind of the person who conceived it. The Northridge Business Model has no higher staircase than success.
8. Autonomy: A business is not part of the owners' life, but a collective reality, functioning as one for all who seek to make Northridge Corporation a success.