Kush Bottles Inc (OTCMKTS:KSHB) stock has been advancing nicely on the strength of the company’s positioning as a premier packaging supplier, offering certified child-resistant and custom-branded solutions in all states that permit medical or recreational cannabis use. KSHB stock has been one of the top performers in the cannabis-related space. In addition, the company just reported record revenues over $8M in fiscal year 2016 (ended August 31), representing year-over-year growth of 105%, so that performance is well earned.
In all, we’ve witnessed about 110% in gains since early September. Shares of KSHB stock have a history of dramatic rallies. Moreover, the listing has registered increased average transaction volume recently, with the past month seeing approaching 320% above the average volume levels in play in this stock over the longer term. This is particularly important with a float in play that’s limited — barely over 14M shares. Traders should not overlook this combination, as a mechanically driven price squeeze can result from this type of mix of small float and ramping attention from traders.
Kush Bottles Inc (OTCMKTS:KSHB) bills itself as a company that markets and sells packaging products and solutions for the medical and recreational cannabis industries in the United States.
It offers pop top bottles; child resistant exit, paper exit, and foil barrier bags; tubes; and polystyrene, polypropylene, or silicone containers to urban farmers, green house growers, and medical and recreational cannabis dispensaries.
The company also sells its products through an online store. Kush Bottles, Inc. was founded in 2010 and is based in Santa Ana, California.
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KSHB is a premier packaging supplier, offering certified child-resistant and custom-branded solutions in all states that permit medical or recreational cannabis use. With over 100 million bottles sold, the company is respected for its quality products, exceptional customer service, fast deliveries, and innovative custom design and branding solutions.
According to the company’s press materials, “Kush Bottles is one of the few cannabis-focused businesses that is publicly traded and has demonstrated profitability and revenue growth without direct involvement with cannabis plants or extracts. The Company has been featured in media nationwide, including CNBC, Los Angeles Times, Entrepreneur.com, TheStreet.com, and Inc. Magazine.”
In addition to the record revenues noted above, KSHB also reported record operating income of $84,455, representing year-over-year growth of 124%. Working capital surplus also grew to $2,026,777, representing a year-over-year increase of 877%.
Possibly the most optimistic point is that the cost of sales dove with total operating expenses as a percentage of revenue coming in at just 32%, representing a year-over-year decrease of 12% for KSHB stock.
The company also noted that sales jumped in the most important markets, with revs in California, Colorado, Oregon, and Washington at $7.6 mln during the year, representing y/y growth just shy of 100%.
“We are very pleased with the revenue growth we saw in all markets in 2016,” said Nick Kovacevich, CEO of Kush Bottles. “We’re excited to continue to push hard in these existing markets in 2017, and to take advantage of the many new markets that may emerge if more states vote to legalize.”
“We are thrilled with our performance in 2016, and we are already executing on plans to build and invest for the future. Colorado, Washington, Oregon and Alaska are just the tip of the iceberg,” said Ben Wu, President of Kush Bottles. “We are committed to continuous development of our organization and infrastructure to accommodate future market growth.”
“We’ve really focused this past year on increasing the efficiency and scalability of the business and the reduction in our operating expenses as a percentage of revenue shows we are succeeding,” said Chris Martin, CFO of Kush Bottles. “We plan to continue to create new efficiencies where possible so we can get more out of the resources we have.”
Kush Bottles stands out in this space as a legitimate player for the longer-term. Currently trading at a market capitalization of $194.3M, KSHB has a decent store ($354.25k) of cash on the books, alongside total assets just under $4.8M, which stands against an appreciable load ($304.44k) of total accumulated debt. So, the balance sheet is in good shape, as are the trends and numbers in the company’s core markets. This is an extremely exciting story given the expansion narrative in the space, and we will check back on the company very soon. For continuing coverage on shares of $KSHB stock, as well as our other hot stock picks, sign up for our free newsletter today and get our next hot stock pick!