At the start of 2021, many cannabis companies both in Canada and the United States have seen their share price come under pressure for a myriad of reasons including shifts in sentiment, however as of late we have noticed a shift in sentiment as MSOS has surged 30% since the beginning of November, pulling many cannabis stocks with it on both sides of the border. With many at their lows, lays opportunity for those willing to dig deeper for value. With the potential renewed sentiment in the cannabis sector, and as we near the end of tax loss season, investors may want to put this undervalued cannabis beverage company on their radar!
Molecule Holdings (CSE: MLCL) (OTC: EVRRF) is a craft cannabis beverage company that manufactures a variety of different brands of cannabis beverages including the company’s own proprietary brands, (PHRESH, SOFA & KLON) as well as three additional brands which the company manufactures for other companies through its B2B model. To date, the company offers 6 different products through the Ontario Cannabis Store and is gearing up to launch its products in many other provincial retailers such as Québec. We have tried many different beverages from different cannabis companies, and we must admit that MLCL definitely has the best tasting beverage product on the market that we have tried and definitely stands out from the rest! Molecule Holdings is located in southern Ontario with its 15,000 sq.ft production facility which sits on 200,000 sq.ft of land, and is focused on producing high-quality tasting products in a 355ml sleek beverage cans and is capable to produce an impressive 3,000 cans per hour!
In June 2021, MLCL announced that the company has entered into a sales amendment partnership and partnered with Great White North Growers for the sale and distribution of Molecule products through the Société québécoise du cannabis (SQDC), the provinces wholly owned cannabis retailer. Québec is a very interesting market, as according to our research the Québec cannabis beverage market only has 4 major players (Hexo, Canopy Growth, TGOD and Tilray offering most of the products on store shelves. With only 4 players in the beverage space in the province of Quebec, this makes competition fairly low when compared to the competitiveness of the flower market when choosing a product.
Molecule is also expanding its sales strategy as the company announced last week that the company is nearing the final stages of Health Canada’s review regarding its sales amendment. Once MLCL receives its sales license from health Canada, the company would now be able to sell its products directly to the provincial retail outlets across the country.
The CEO of MLCL Mr. David Reingold commented “Receiving final approval of the sales amendment is critical to the business. We are quite excited to be almost through this process. National expansion and direct in store placement will now be the absolute focus of our business. We are very confident in our ability to compete at every level in the beverage category including price, innovation and branding.”
In addition to growing its retail footprint across Canada, Molecule is also expanding the company’s product line to include infused coffee flavoured beverages! On Wednesday, MLCL introduced a new line of infused coffee flavoured beverages which it calls Cannajo. The company will begin offering two specialty products under the Cannajo brand, Nitro Oat Milk Latte with 2mg of THC and 10mg of CBD, along with a Spiced Espresso beverage that will contain 10mg of THC. MLCL anticipates a full launch with Cannajo beverages hitting store shelves in the first quarter of 2022. David Reingold, the CEO of MLCL was quoted “This new product demonstrates our dedication in providing cannabis consumers with the best tasting beverage the market has to offer. Our initial discussions with store owners have been met with a tremendous amount of enthusiasm for the upcoming launch of Cannajo products in Canada”. Launching a cannabis infused coffee beverage is extremely innovative considering this is the first cannabis infused coffee flavoured beverage to hit the Canadian market, giving MLCL a first mover advantage. Launching a new and innovative product is a great way to attract new customers and generate more revenue as consumer begin to explore the other products that MLCL offers.
At less than a $7 million dollar market cap, Molecule Holdings (CSE: MLCL) (OTC: EVRRF) is definitely an undervalued and under the radar cannabis stock that you will want to keep on your radar as the company begins its expansion plans across Canada!
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