2019 has been a good year for OrganiGram stock investors. If you placed your money down on this cannabis producer back in 2018, then you have already doubled your investment. Yes, OrganiGram Holdings (TSXV:OGI) (OTCQX:OGRMF) has been steering its ship very well through the often ambiguous waters of the cannabis industry.
Here are some reasons OrganiGram stock is doing so well.
OrganiGram Stock: Profits
The company is one of the few to actually report profits. Believe it or not, in this nascent industry many brands have reported losses due to the operational costs of establishing the business and supply chain issues in Canada. While many await profits further down the line, in Q2 OrganiGram reported net sales of $26.9 million CAD, versus operational expenses of just $5.7 million CAD.
According to the Motley Fool:
"After adding back share-based compensation to the adjusted profit, operations lost just $1.8 million CAD during OrganiGram's fiscal second quarter. It looks like the company is close to sustainable, positive cash flows, and that's not the only reason the stock could keep rising in 2019."
OrganiGram Stock: Capacity
With a market cap of $1.45 billion CAD, OrganiGram Holdings is the tenth largest cannabis producer by market cap. While it is not the largest producer, its capacity expectations are keeping up with some of the largest.
Recently, the company received an expanded cultivation license from Health Canada. This license allows it to expand its Moncton Campus facility, thereby increasing OrganiGram's production capacity. Now, it has an annualized production target of 113,000 kgs by the end of 2019. OrganiGram stock soared on this news—hitting its highest levels since the beginning of the year.
Gains like this are understandable. Not only does the news show that management is delivering on promises, but reaching this capacity also places OrganiGram Holdings in the top eight cannabis producers in terms of capacity.
OrganiGram Stock: Uplisting
The company brought another exciting piece of news to investors recently. On April 26th, OrganiGram applied to list its shares on the NASDAQ exchange. Should this move be approved, then the company will have far more investment sources at its disposal, and OrganiGram stock is likely to jump again.
The potential uplisting is a positive sign for the industry as a whole, as more cannabis companies are making their way onto one of the major American exchanges.
If successful, OrganiGram Holdings will become the third Canadian cannabis company to list on the NASDAQ, with Tilray (NASDAQ:TLRY) and Cronos Group (NASDAQ:CRON) already there.
OrganiGram stock is currently selling for $7.00 on the OTC. What do you think? Are you an OrganiGram fan?
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