Q: Hello
Any reason why electrovaya is surging? A week ago Trump commented on possible reclassification if cannibis. However stocks like canopy are going up and down daily. Is it worth putting some money to work? Thank you
Any reason why electrovaya is surging? A week ago Trump commented on possible reclassification if cannibis. However stocks like canopy are going up and down daily. Is it worth putting some money to work? Thank you
5i Research Answer:
While recent US moves are more encouraging for the cannibis sector, most companies are still experiencing very weak sales and negative cash flow. WEED is a shell of its former self and still had negative cash flow of $124M in the past 12 months. It has had an accounting 'going concern' warning as well. We still find it hard to endorse the sector. ELVA missed estimates, but affirmed guidance and does expect to enter a period of high growth. It has launched several new products this year that are seeing good market acceptance and contract wins.