MENTOR CAPITAL INC COM NPV (OTCMKTS:MNTR) is one of the more interesting stocks in the cannabis arena. The company is focused on capital investment in the space. That theme was recently on display once again when the company announced it has taken a $1.0 million position in the stock of GW Pharmaceuticals, a United Kingdom based group developing a portfolio of cannabinoid prescription medicines.
Mentor Capital, Inc. CEO, Chet Billingsley explains his investment analysis, “During the last few months Mentor has seen a rapid and continuing expansion in investable cash and we wanted to get more of that working for us in the also rapidly growing medical marijuana sector in a general up market for stocks. GW Pharma is somewhat isolated from the political uncertainty in much of the domestic cannabis market because it is both medically focused while internationally based and marketed.”
MENTOR CAPITAL INC COM NPV (OTCMKTS:MNTR) is a United States-based firm that invests in medical marijuana and recreational use cannabis companies. The Firm has $140 million capital structure and looks like a marijuana fund or cannabis index fund.
According to company materials, “The Company seeks to come alongside and assist private medical marijuana and cannabis companies and their founders in meeting their liquidity and financial objectives, to add protection for investors and to help incubate private cannabis companies.”
It invests in shelf IPOs and public and private companies, and seeks to provide public market access to owners of small private companies. In case of shelf IPOs, the firm prefers to invest in companies with sales greater than $40 million. MNTR prefers to take significant position in its portfolio companies. Additionally, the firm invests only in companies that have actual earnings.
MNTR seeks to come alongside and assist private medical marijuana and cannabis companies and their founders in meeting their liquidity and financial objectives, to add protection for investors and to help incubate private cannabis companies.
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As we have previously noted, “Mentor Capital, Inc. is looking to apply to join the 399 companies in the OTCQX, the top tier of the 10,000 companies organized by OTCMarkets.”
Apparently, all aspects of qualification are arranged, including net tangible asset levels, bid price, market makers, number of shareholders, market cap, audited financials, full SEC reporting, independent directors and an audit committee. Following the next board of directors meeting, it is anticipated that the formal paperwork will be submitted to OTCMarkets for their consideration.
According to the company’s latest release, Mentor reports that it held $2.5 million in cash prior to this week’s GW Pharmaceutical stock purchase and its 7,500 shareholders held an additional $11 million in long-term warrants that have been the ongoing source of its investment cash.
Mentor’s preferred involvement is with larger and private pre-IPO medical marijuana companies that Mentor can help operationally prepare for the public market and finance, sometimes working with institutional partners seeking public liquidity. As such, Mentor is not an Investment Company under the 1940 Act.
The stock has powered nearly 74% higher during the past month. Mentor Capital stock will likely continue to be worth watching. Furthermore, the name has seen growing attention and interest of late, with the recent average trading volume running 330% beyond levels characterizing the pace of transactions over the larger time frame.
This should not be overlooked with the stock trading on a float that is limited at just 13.2M shares. One is wise to respect the dynamic this may create — ramping trading activity can overwhelm available supply in a stock with this type of small float, leading to an upward burst in prices.
Mentor Capital pulled in about $2.73M in trailing 12-month revs last year, with sequential quarterly growth on the top line coming in at about 9%. The company has about $59k in cash on the books, which is balanced by about $580k in total current liabilities. This is a highly volatile story, no doubt with many interesting plot twists ready to roll out. We will stand at the ready for the next chapter. For continuing coverage on shares of Mentor Capital stock and other hot stock picks, sign up for our free newsletter today and get our next hot pick!
