Fire & Flower: Featured Cannabis Stock
Should you invest in Fire & Flower Cannabis Stock? Recommendation: Keep Reading
Fire & Flower (OTC: FFLWF) (TSX: FAF) is an adult-use cannabis retailer in Canada. They focus on education and the consumer experience with their Hifyre digital platform. Fire & Flower is looking to move globally in the coming months.
Fire & Flower: Company Profile
HQ: Edmonton, Canada
Facilities: Alberta, Saskatchewan, Manitoba, Ontario
Symbol: FFLWF (OTC) & FAF (TSX)
Fire & Flower: Strong Focus
Fire & Flower is a leading adult-use retailer of cannabis, focused on expanding its market share in Canada with acquisitions and strategic partnerships. Fire & Flower is acquiring new consumers by educating them about cannabis through their Hifyre digital platform. Fire & Flower is aiming to help its customers through new payment mechanisms and distribution strategies to grow revenue base.
Fire & Flower: Neutral Size
Market Cap: US $55.78 mil
Enterprise Value: US $95.30 mil
Number of employees: 198
Fire & Flower: Neutral Markets
Fire & Flower: Weak Operations
Direct sales: Though Hifyre digital platform
Store networks: 34 in operation and license pending for another 25 stores
Supply agreements: Signed supply agreement with Mera to which its subsidiary Open Fields will serve as a distributor of adult-use cannabis in Saskatchewan
Vertically integrated: no
Horizontally diversified: no
Fire & Flower: Weak Financials
- Revenue last quarter was $13.7 million
- Margins: 34.3%
- Shares Outstanding (diluted): 146.9 mil
- EPS (diluted): 0.07
Fire & Flower: Neutral Management
CEO: Trevor Fencott
President (Hifyre): Matthew Hollingshead
Trevor Fencott, CEO of Fire & Flower, has vast experience in leading and managing cannabis production and education companies. Matthew Hollingshead, President of Hifyre, has a lot of experience leading cannabis digital companies and investing in the cannabis sector.
Fire & Flower: Strong Branding
Fire & Flower: Neutral Valuation
- Current share price: US $0.40
- Price to Sales: 0.88 (Biopharma industry average = 7.5)
- EV / Revenue: 2.43
- 52 week low/high: US $0.19-$1.28
- Price/Book: 0.88
Fire & Flower: Strong Financings
Fire & Flower: High Risks
Fire & Flower: Strong Recommendation
Fire & Flower is a leading adult-use retailer of cannabis, focused on expanding its market share in Canada with acquisitions and strategic partnerships. Fire & Flower is acquiring new consumers by educating them about cannabis through their Hifyre digital platform.
Fire & Flower is aiming to help its customers through new payment mechanisms and distribution strategies to grow its revenue base. Fire & Flower is successfully adjusting to the new COVID 19 pandemic impact by deploying online payments, home delivery, and curbside pickup options.
Trevor Fencott, CEO of Fire & Flower, has experience in leading and managing cannabis production and education companies. Matthew Hollingshead, President of Hifyre, has a lot of experience leading cannabis digital companies and investing in the cannabis sector.
Fire & Flower raised $25.5 million on June 26, 2019, after closing a bought deal in the private placement. On August 7, 2019, Fire & Flower raised an additional $24.1 million from Strategic Investment which significantly improved the liquidity position.
Will its stock price improve in the long term? Likely
By March 31, 2019, Fire & Flower’s cash, cash equivalents, and short-term investments were $42.9 million which is enough to finance operations, manage working capital and opening new stores in 2020.
Fire & Flower’s return on total asset (ROA) was 5.9% which implies that it made a loss of $5.9 on every $100 spent on asset. This is comparatively better as compared to the industry average and it will improve further as they intend to open additional stores.
Fire & Flower’s revenue experienced double-digit growth in the last three quarters of 2019 and declared a positive net income of $10,2 million in the third quarter of 2019. Fire & Flower declared their first positive EPS of 0.05 in the third quarter of 2019 which is the result of their focus on solid financial performance. Watch for more good things to come from this company.
Fire & Flower: Featured Cannabis Stock
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