Company: Nutritional High International Inc.
Chairman, CEO and President: Adam K. Szweras
Markets: Canadian Securities Exchange (EAT), OTCQB (SPLIF)
Market Cap (09/09/19): C$53.9M
Share Price (08/16/19): C$0.15
52-week high/low: C$0.37/C$0.12
Nutritional High International Inc. (“Nutritional High”) is a vertically integrated distributor in California, and manufacturer, distributor, and product developer with operations in Colorado, Nevada and Oregon. FLITM is the Company’s flagship cannabis-infused product line, which is available for purchase and includes edibles, vape cartridges, syringes and extracts. The company is developing a portfolio of diversified cannabis brands and rapidly growing its manufacturing and distribution footprint in the US, positioning itself to deliver sustained value for its shareholders. At the same time, its actively pursuing a Canadian strategy based on its joint venture with Canada House Wellness Group and expects significant progress in the coming weeks
“With more than 600 retail clients in California, six in-house brands and eight facilities across five US states, Nutritional High is ahead of the game within the cannabis oils and edibles space.”
Greg Beckett, Senior Analyst and Chartered Investment Manager for the Richmond Club
“We believe manufacturing and distribution offer one of the greatest opportunities for investors in the cannabis vertical,” explains Adam Szweras, CEO of Nutritional High. “Operating in these segments of the value chain enables us to augment margins, develop strong brands, and influence retail shelf space.”
Capturing value across two diverse and robust business units
Nutritional High is organized into two strategic business units:
- Manufacturing and Brand Portfolio – Nutritional High has production and extraction capabilities in-house and with third-party manufacturers across California, Nevada, Colorado, Oregon, Washington and Canada. In total, Nutritional High operates across 5 US states and Canada, comprised of nearly 25,000 square feet of production and manufacturing capacity. Manufacturing is supplemented by a portfolio of leading-edge brands including FLITM and the Marley Natural family of brands. These brands will focus on the highest margin value-added products in the sector – edibles and extracts.
- Distribution of Third-Party Brands – Nutritional High’s current distribution revenue stream comes from Calyx Brands, a California based cannabis distributor that the company acquired in March 2018, growing monthly revenue from CAD $250,000 to CAD $2 million within a year. Nutritional High is currently forming a disruptive, flexible and multi service-oriented distribution model as a vehicle to ensure its next stage of scalability and market influence in California.
“With more than 600 retail clients in California, six in-house brands and eight facilities across five US states, Nutritional High is ahead of the game within the cannabis oils and edibles space. As per the Company’s Q3 2019 financial results, revenue has increased 368% over the same period in the previous year. The Company has a clear vision, has proven its ability to execute, and is poised for a strong 2020 and beyond” says Greg Beckett, Richmond Club Senior Analyst and Chartered Investment Manager. Beckett picks stocks for the Richmond Club Index, which has averaged a return of approximately 20% per year over the last decade and a half.
“The company has enjoyed five quarters of continuous revenue growth starting in Q3 2018,” adds Becket. He believes now is the time to invest in Nutritional High because:
- Nutritional High captures high margin components of the value chain and is one of the largest distributors in California where it supplies products to over 600 retail locations.
- The company uses a cryo-ethanol process to extract oil, that helps them keep prices low without compromising quality. Nutritional High is seeing take-up in the market from the process, a marriage of expertise and intellectual property.
- Nutritional High is undervalued and poised for a correction. The Company’s valuation was five times higher 12 months ago, when it had minimal revenue. During the last year, management focused on execution and increased its revenue by 368% over the previous year. We believe this is a good buying opportunity as the revenues trend upwards and management continues to deliver.