MJNA: Party Is Over

Aug. 13, 2013 10:32 AM ETMJNA6 Comments
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Cannabis stocks

Contributor Since 2006

Alan Brochstein, CFA, was one of the first investment professionals to focus exclusively on the cannabis industry. He has run 420 Investor, a subscription-based due diligence platform for investors interested in the publicly-traded cannabis stocks, since 2013, and he is also the managing partner of New Cannabis Ventures, a leading provider of relevant financial information in the cannabis industry since 2015. Alan is based in Houston.

Before focusing exclusively on the cannabis industry in early 2014, Alan had worked in the securities industry since 1986, primarily with the responsibility for managing investments in institutional environments until he founded AB Analytical Services in 2007 in order to provide independent research and consulting to registered investment advisors. In addition to advising several different hedge funds and investment managers, including Friedberg Investment Management, where he participated as a member of its investment management committee, Alan was also a senior analyst for the independent research firm Management CV. In 2008, he began providing a first-of-its-kind subscription-based service for individual investors, Invest By Model, which offered two different portfolios that investors could replicate in their own accounts. Alan also offered The Analytical Trader at Marketfy, where he used fundamental and technical analysis in a disciplined process to offer specific trade ideas geared towards swing traders.

I will be updating some observations about the MJNA Q2 results. There are two source documents:

The company's operating results were very weak - less than $1mm in product sales and an operating loss.

SEC Inquiry


Interestingly, the company reported that CannaVest (CANV.OB) paid them partially in cash on the $8mm installment payment due 6/30. At one point, it was described as "$750K" but in another as "$726,157.00". Note that CANV recently borrowed about $3mm more from its CEO and from presumably Michael Llamas (Roen Ventures). Given that CANV is "trading" so high above the $6 collar, paying cash makes a lot of sense (why sell a stock at 6 when it is trading at >10).

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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