STT weekend lounge 22-24 June, page-45

STTCOMP QBL, FA LONG​

SOI: 1.6B
SP: 4.6c (Fridays closing share price)
MC: $75.6m
Cash: ~$8m

On FA grounds, QBL as a weed stock is undervalued and great value play on Fridays close, compared to comparative peer valuations of other listed weed stocks.

By way of example, CANN Group (ASX Code: CAN) on Fridays close had $411m market cap with its ODC licence and focused on cannabis medical side. Earns no revenue (see last quarterly) and expected to be long time before see any revenue from medical cannabis side.

QBL through acquisition of Medcan now has ODC licence with DA approved lab ready to be operational by end of year for medical cannabis side and then have cannabis food side where already have major contracts with Red Tractor supplying Coles and also distribution through online and other retail outlets for Vitahemp etc brands and just had first major harvest in April with next harvest expected to be double Aprils harvest. So early revenue / cash flow from hemp food side of business with exponential growth expected quarter on quarter from here already plus Canitab ready to go.

And then have Bauxite thrown in as wild card. QBL valued at fully diluted basis (ie ~3b shares) at $140m based on Fridays close
or roughly 1/3rd of CAN valuation.

A lot of posters on the QBL thread are focussing on the 3b shares that will be end result after two acquisitions of Medcan (100%) and MCL (remaining 45% does not own) and when the only metric that matters is comparative valuations to other cannabis stocks and to me shows clearly undervalued. Especially for me when considering only fully integrated cannabis play justifies additional premium to share price valuation imho and why QBL my only weed stock invested in despite invested/playing in others at different times.

For value players/investors I believe this is as good as it gets.​