The Canadian marijuana stocks on our list are cost leaders in the cannabis industry
SmallCapPower | June 22, 2017: Being able to sell products at a high margin is a good sign of efficiency. Doing so leaves more cash to dedicate to other expenses and service debt obligations. Identifying companies with high gross margins in the young marijuana industry is important because operating costs are likely to decrease as the industry matures, leaving these companies with high earnings potential. Today we have identified five Canadian marijuana stocks with gross margins well above its industry peers.
Invictus MD Strategies Corp. (TSXV: IMH) – $1.39
Invictus MD Strategies Corp is a Canada-based company engaged in the field of alternative medicine. The Company specializes in acquiring, funding and developing entities, which are involved in medicinal marijuana area. It focuses on the production and distribution of medicinal marijuana through online stores, sell of hydroponic equipment and fertilizers, as well as of accessories for cannabis intake. The Company also is active within research and testing, as well as offers advisory services. Its investment portfolio comprises a number of entities, such as Cannabis Health, Smokazon, Vitaleaf, the Edison Vape Co, Greener Pastures MD, Future Harvest, as well as Canadian Cannabis Health Expo Inc.
- Market Cap: $53,100,643
- Total Revenue (LTM): $3,706,130
- Debt to Equity: 18.7%
- Gross Margin: 35.3%
CanniMed Therapeutics Inc. (TSX: CMED) – $8.04
CanniMed Therapeutics Inc is a Canada-based plant biopharmaceutical company that specializes in the production of pharmaceutical-grade cannabis and offers a range of pharmaceutical-grade cannabis products. In addition, the Company has a plant biotechnology research and product development program focused on the production of plant-based materials for pharmaceutical, agricultural and environmental applications. The Company, through its subsidiary CanniMed Ltd, offers medical cannabis oils, dried medical cannabis, vaporizers, vaporizer parts and accessories. Its CanniMed Oils are made using only dried cannabis flowers.
- Market Cap: $182,936,314
- Total Revenue (LTM): $5,788,000
- Debt to Equity: 127.6%
- Gross Margin: 37.1%
Canabo Medical Inc. (TSXV: CMM) – $0.41
Healthcare Facilities & Services
Canabo Medical Inc, formerly Four River Ventures Ltd, is a Canada-based company, which is engaged in the provision of medical services and non-cannabinoid products for patients suffering from chronic pain and disabling illnesses through health clinics. The Company operates approximately 10 medical clinics across Canada. Its medical clinics are operated by qualified health care practitioners, independent medical marijuana evaluations for employers and insurers, and medical marijuana scientific research. Each clinic provides cannabinoid educators, who consult with patients to determine the proper treatment for their ailments using medical marijuana based on the medical documentation as prepared by the physician.
- Market Cap: $15,564,609
- Total Revenue (LTM): $2,080,850
- Debt to Equity: 0.0%
- Gross Margin: 53.8%
OrganiGram Holdings Inc. (TSXV: OGI) – $2.20
OrganiGram Holdings Inc., formerly Inform Exploration Corp., is a Canada-based company, which operates through its subsidiary Organigram Inc. Organigram is a licensed medical marijuana producer as regulated by Health Canada under the Marijuana Medical Access Regulations (MMAR) of the Government of Canada.
- Market Cap: $228,096,870
- Total Revenue (LTM): $6,127,630
- Debt to Equity: 16.9%
- Gross Margin: 54.1%
Aphria Inc. (TSX: APH) – $5.30
Aphria Inc., formerly Black Sparrow Capital Corp., is a Canada-based company, which is engaged in producing and selling medical marijuana through retail sales and wholesale channels. The Company’s retail sales are sold primarily through the Company’s online store, as well as telephone orders. Its wholesale shipments are sold to other Medical Purposes Regulations (MMPR) Licensed Producers. It offers medical cannabis of various strains, including Kusawa, Tamaracouta, Panache, Churchill and Iroquois. The Company is also engaged in the research and development, and commercial production of cannabis oil.
- Market Cap: $736,535,739
- Total Revenue (LTM): $8,433,930
- Debt to Equity: 0.0%
- Gross Margin: 70.9%
Disclosure: Neither the author nor any of the principals at Small Cap Power, or their family members, own shares in any of the companies mentioned above.
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