Zenabis stock has been gaining momentum over the past couple of weeks. Let's analyze the recent developments of Zenabis Gloabl (TSX:ZENA) (OTCPK:ZBISF).
The past months have been quite tough for the cannabis industry, and the effect has also been felt by investors who have seen their favorite stocks plunge to new lows. However, even during a downturn, there are certain stocks that may be a bit overlooked, and Zenabis stock could well be one of those.
The stock has gained by as much as 15% in the last week of November, and in this regard, it is important to note that Zenabis stock is now down 95% from its 52-week high.
Rights Offering
Zenabis Global has displayed a lot of weakness in recent times, and cash flow was one of the biggest issues. In an important development on November 28, the company made an announcement with regards to its rights offering. The company had offered 139,086,624 of its common shares for $0.15 per common share and managed to raise $20.8 million.
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Moreover, it was oversubscribed by as much as 20%. Zenabis Global is probably going to use the proceeds to bump its production capabilities. The company has targeted to have 96,000 kilos by end of this year and 143,200 kilos by the end of 2020.
At the time of writing, Zenabis stock is down 4% at $0.15 USD.
Q3 Earnings
Earlier on in November, the company also announced its financial results for the third quarter, and it made for grim reading. The revenue declined from the previous quarter by as much as 52%, slumping to $12 million. On the other hand, the company’s inventory rose 58% from the second quarter to hit $28.34 million.
The industry is currently suffering from oversupply issues, and Zenabis Global is no exception in that regard.
What do you think of Zenabis stock after the recent price movement? Share your views in the comment section below.
Featured image: Canva
