SAFE
The safe Act will make it easier for banks and credit unions to offer financial services to "banks" the cannabis industry will be reintroduced in the House today. Rep. Ed Perlmutter's (D-Colo.) office confirmed that the SAFE Banking Act would be reintroduced today, and according to Politico, a press call will be held Friday at 10 a.m. EST with Reps. Warren Davidson (R-Ohio), Steve Stivers (R-Ohio), and Earl Blumenauer (D-Ore.) to discuss the legislation. The first step in legalization is to get the cannabis industry access to banking and related services. The bill has broad bipartisan support and backing from the nation's biggest banking trade groups, such as the American Bankers Association, this time around it appears to have 60 votes needed to pass in its current form. Ahead of the September 2019 vote, criminal justice reform groups such as Drug Policy Alliance and the ACLU asked House Majority Leader Steny Hoyer to hold the banking bill until more comprehensive legislation addressing marijuana legalization expungement of records could be brought to the floor. Then-Senate Minority Leader Chuck Schumer also said in June of 2019 that Congress should not pass stand-alone cannabis banking legislation without a broader overhaul to federal cannabis laws. As it is written today, our understanding is that the bill will not allow the shares of major US companies to trade on major exchanges.
Green Thumb (GTBIF)
GTBIF is a LONG
In 4Q20, GTI reported total revenue growth of 133.8%, with retail revenue growth of 145%, and ended with 51 stores open up from 48 in 3Q20. GTI reported Q4 EPS $0.011 vs FactSet $0.06 and Revenue $177.2M vs FactSet $166.7M; Adjusted EBITDA $65.4M vs FactSet $56.7M. (A) EBITDA margin was 36.9%, up from 33.9% in 3Q20. For the year 2020, the company reported $556.6 million in revenues, up 157%, and (a) EBITDA margin of 32%, up from 10.2% last year. In 4Q20, the company generated $40.6M in OCF and FCF of $20.6M. For 2020 the company generated $111.2M in OCF and $42.0 million in FCF. As of 31-Dec-20, current assets were $183.9M, including cash and cash equivalents of $83.8M.
There was nothing in the quarter or call to change our opinion that GTI is one of the best-managed companies in the space.
Dutchie makes software acquisitions.
Dutchie, a cannabis tech platform, announced the acquisitions of Greenbits and LeafLogix, which are software companies. The companies help streamline e-commerce tools for dispensaries. Dutchie works with 2,116 dispensaries across 36 markets in the US and Canada. Dutchie also raised $200M in a Series C funding round that values the company at $1.7B. Dutchie said it is seeing greater demand for other non-flower products.
