27% profits every 20 days?
This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.
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The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.
The cannabis industry is growing, fast. Not long ago, marijuana use was strictly illegal and heavily stigmatized. Now more than 22 million Americans are estimated to use it on a monthly basis, according to the Centers for Disease Control and Prevention (CDC), and a recent Pew Research Center poll found that 91% of Americans think its use should be legal in some capacity.
On Nov. 6, 2012, Washington and Colorado became the 1st states to legalize marijuana for recreational use. And as of September, marijuana use is legal in 18 states and decriminalized in 13 more. This has led to a huge market for cannabis, from growers to retailers.
In fact, led by heavy-hitters like Tilray Inc (NASDAQ:TLRY) and Canopy Growth Corp. (NASDAQ:CGC), the legal market brought in $17.5 billion in 2020. That’s a 46% increase from 2019. By 2025 the industry should pull in revenues of $43 billion with a compound annual growth rate (CAGR) of 16%, according to the research firm New Frontier Data.
With these eye-popping revenues, it can be easy to overlook one critical fact: Many of these companies don’t end up making a profit. They operate at a loss, spending more than they earn. It is expensive to operate in this space, and for many companies, their gross revenues don’t outpace their expenses.
Acreage Holdings Inc. (OTC:ACRHF), a large player, had an earnings before interest, taxes, depreciation, and amortization (EBITDA) loss of $1.3 million last quarter, while retail giant MedMen Enterprises Inc. (OTC:MMNF) reported a net loss of $55.3 million.
One example of an exception to this trend is Grove Inc. (NASDAQ:GRVI). Grove just reported its 2022 1st-quarter earnings, and the company is in the black. It reported an adjusted EBITDA of $1.4 million. This came from a revenue of $8.4 million, up from $2.9 million in the 1st quarter 2021.
“Grove’s 1st-quarter financial results reflect strong growth in revenues, net income and cash flow as our team continues to execute our vision to transform the landscape of how hemp and wellness products are produced, bought and sold,” Grove Chief Financial Officer Allan Marshall said of the report. “Seasonally, our 1st quarter is typically our slowest, yet $8.4 million signifies exponential growth and sets us up for a strong fiscal year. Our revenue increase is primarily driven by strong growth in the sales of new products from our direct-to-consumer business.”
If you’d like to know more about the company, check out its website here.
The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.
27% profits every 20 days?
This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.
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