mCig Stock: Is This Penny Stock Showing Potential for 2019?

mCig stock

mCig stock is an interesting consideration for any potential investors for two very important reasons; it is straddling two of the most lucrative and booming industries of late.

The first industry is, of course, marijuana—the time for this industry is now. The second industry is e-cigarettes; the healthier, battery-powered take on regular cigarettes. This industry is simply culling the tobacco industry at a fast rate.

Placing itself firmly between these two industries, mCig Inc (OTCQB:MCIG) has a market cap of $90.2 million but comes with some not-so-favorable fundamentals. So should you get excited about mCig stock in 2019?

mCig Stock

mCig Inc could be a dark horse. Selling for $0.17 USD and up 2% on the day, this penny stock has its fingers in many pies. Firstly, it occupies the cannabis industry in the US and internationally. It has four divisions: Retail Sales; Cultivation, Manufacturing, and Distribution (CMD); Media and Technologies; and Agriculture.

Effectively, what these four divisions amount to is that mCig can help construct cannabis greenhouses, while also selling and distributing e-cigarettes, along with CBD products and vaporizers. And not to miss out on media and technologies, the company also operates 420cloud, a social media platform for cannabis marketing. Plus, its Agriculture segment plants and grows industrial hemp.

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mCig Inc does a LOT. A benefit of this means different revenue streams, which also means it can rely on different areas for survival. For example, If e-cigs become naff in the morning, well, mCig can still survive on its CBD arm.

mCig Stock and Public Policy 

With so much going on, there’s always something happening in public policy that could bode in mCig’s favor:

  •  Most recently, the passing of the Farm Bill in America means CBD production and sales are set to skyrocket in 2019. As a CBD producer, mCig will benefit from this. Tick.
  •  Then, with its hand firmly in cannabis, the penny stock can reap the benefits of Canada’s passing of the recreational marijuana law. Tick.
  •  And finally, vaping is increasingly trending, and mCig has this area covered too. Tick.

So mCig and its stock look set to take over in 2019. Right?

>> Weed Stocks Trading Up: Namaste Technologies and MedMen Enterprises

Not necessarily wrong, but not so fast.

mCig Stock Fundamentals

Fundamentals are the kicker here. In the most recent quarter, on a year-over-year basis, the company’s revenue growth came in at -80.1%. If that wasn’t bad enough, EBITDA was -$1.53 million.

Oh dear.

mCig’s total cash on hand was a paltry $449,750.

So, to put it plainly, the company is generating losses. Now, you can see this as one of two things: 2018 was the ‘development’ year; the year in which you spend a lot in order to eventually make a lot. Or else, you see this as another company capitalizing on ‘hype’ but doesn’t have what it takes to last in either of its lucrative industries.

The Takeaway

mCig stock could ride well off the back of industry sentiment, but it won’t survive on its current fundamentals. It simply hasn’t got the money in the kitty to continue growing, for one thing. Take care with this penny stock; it has potential, but it comes with major risk. 

Featured Image: Depositphotos/leungchopan