Cannabis e-commerce company Namaste Technologies Inc (TSXV:N) (OTCQB:NXTTF) seemed to have a business that should have been prosperous, but Namaste stock has been performing abysmally for quite some time.
Key Developments and Earnings
Earlier this year, the company removed its Chief Executive Officer and appointed the Chief Product Officer as its CEO. Although its Q1 2019 proved to be a disappointment, Namaste’s Q2 2019 earnings have proven to be a bit of a welcome boost for the company. It seems the company could be on its way to making a recovery after successive quarters of disappointment.
Revenues for the quarter stood at $4 million with a year-on-year drop of only 2.4%, which was not as bad as it was in the first quarter of the year. Additionally, Namaste’s net loss deepened to $8.6 million in the quarter as opposed to $8.1 million in the prior-year quarter, but it needs to be pointed out that in Q1 2019, its net losses stood at an alarming $10.3 million.
Although it is true that improvements have certainly taken place, there are still certain issues that make it clear Namaste Technologies is still on the road to recovery. Additionally, the expenses seemed to mount from $9.1 million CAD in Q2 2018 to $9.8 million CAD in the present quarter, and that had an impact on the rise in net losses as well.
At the time of writing, NXTTF stock is trading up by 2% at $0.40 on the OTC market. On the Canadian side, Namaste stock is up 2% and now selling at $0.52.
At the same time, it is important to point out that the company has also developed its network of businesses by acquiring a bigger stake in the medical cannabis delivery company Pineapple Express Delivery. It now has a 49% stake in the company and acquired an identical stake in Choklat as it readies to enter the edibles space. It cannot be denied that Namaste Technologies is currently trying to turn its business around decisively and the new acquisitions could help in the long run.
That being said, it currently has $55.8 million CAD in cash and equivalents, which is why it would not be possible for Namaste to continue to fuel its business through acquisitions alone.
Namaste stock is one of the biggest losers in recent months with a fall of 40% since the beginning of June.
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