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Cannabis Science, Inc. CBIS (OTC)

Should you invest in Cannabis Science, Inc.? Recommendation: See Below

Cannabis Science, Inc.Cannabis Science, Inc. develops cannabis pharmaceutical products. It works on phytocannabinoid science targeting critical illnesses and adheres to scientific methodologies to develop, produce, and commercialize cannabinoid-based pharmaceutical products.

Fundamentals

Profile:
HQ: Irvine, CA, USA
Founded: 2009
Facilities: California
Symbol: CBIS (OTC)

Focus: Neutral
Cannabis Science is aiming to be a pioneering biotech company by creating cannabinoid-based extract formulations for many different medical conditions in addition to more than 8 different types of Cancer. They aim to derive earnings from each of these individual formulations. The potential sources are combined with additional profit centers including nutraceutical products, educational model and strategic partnerships with MedBox® Solutions.

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Size: Weak
Market Cap: US $33.17 mil
Enterprise value: $36.49 mil
# of employees: 20

Markets: Neutral
Primary:  California
Secondary:   USA, Europe
Subsidiaries: Majority: Cannabis Science Europe, Equi-Pharm, Michigan Green Technologies, Cannabis Consulting
Minority interests: None

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GTI

 

 

 

Operations: Neutral
Cultivation:
Present capacity: None
Future capacity: 1,000 Kilograms Per Month of Purified High CBD and CBDA Water-Soluble Extracts and Powders

Distribution:
Direct sales: Online sales and two pharmacies
Store networks: Cali Rx and Nexus Rx in California
Supply Agreements: Agreement with CBIS Holding B.V. in the Netherlands for supply across EU

Integration/Diversification:
Vertically integrated: Yes
Horizontally diversified: No

Should you invest in Cannabis Science, Inc.? Recommendation: See Below

Financials:  Weak
Outstanding shares (diluted): 2.55 bil
Revenue last year: $9.2  mil
EPS: ($0.01)

Management: Strong
CEO: Raymond C. Dabney
CFO: Benjamin C.K. Tam
COO: Robert Kane

Cannabis Science’s CEO, Raymond C. Dabney, brings 25 years of experience in co-founding several companies in diverse industries such as drug development, media, advertising, communications, and real estate. Cannabis Science’s CFO has more than 15 years of experience in the entertainment industry and the COO has more than 10 years of experience in marijuana company management.

Branding: Neutral
Cannabis Science’s product development encompasses a farm to bedside program. Cannabis Science’s branding strategy is focused on all consumers centered information service operations for smooth communication between the general public and the group of companies, consumer order requests, and inquiries.

Valuation: Weak
Current share price: US $0.01
Price to Sales: 14,202
52 Week Low/High: $0.0022 to $0.064
EV / Revenue: 4,739

Financings: Neutral
In 2016, Cannabis Science exercised a total of 292,000,000 common stock options with net gross proceeds of $2,920,000 of which $1,646,000 were received by the Company.

Risks: High
The risks of investing in any cannabis company are currently high given the newness of the market. The risks of investing in this company are sky-high given the lack of products and amazingly high outstanding shares.

Recommendation: Weak

Cannabis Science is aiming to be a pioneering biotech company by creating cannabinoid-based extract formulations for many different medical conditions in addition to more than 8 different types of cancer.

They aim to derive earnings from each of these individual formulations. The potential sources are combined with additional profit centers including nutraceutical products, educational models and strategic partnerships with MedBox®Solutions.

Cannabis Science is in the process of increasing its future capacity of CBD production to 1,000 kilograms per month of Purified High CBD and CBDA Water-Soluble Extracts and Powders.

However, besides all the good news, Cannabis Science announced that legal action by San Joaquin County, California has impacted their business dramatically as their hemp crop was seized. Cannabis Science intends to take legal action which will cost them well over $500,000 in legal fees and expenses.

Will it’s stock price improve in the long term? Nope!

Cannabis Science did not publish any quarterly or annual financial reports since 2016 which led to the suspension of their stock trading in September 2019. They have announced three possible courses of action in the near future.

The first option is to continue to fully report and file outstanding quarterly as well as annual financial statements for 2017 and 2018. Their second choice is to de-list as a fully reporting company and change their status into ‘non-reporting issuer status’ and then file all outstanding un-audited financial statements. A third option is a buyout of Cannabis Science by a newly public company via share exchange to existing shareholders with shared in acquiring the company.

For these reasons, we think Cannabis Science, even at its current price of $0.01 a share, is still a very risky investment opportunity—though as they resolve the issues with regulatory authorities then opportunities can appear. We are cautiously pessimistic about its chances.


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