Near-Doubled Revenues Show High Tide Is a Canna-Biz Contender

Here’s a hidden gem in the cannabis accessories space. I invite you to check out High Tide (NASDAQ:HITI), which has actually been around since 2009. However, HITI stock only started trading on the Nasdaq Exchange on June 2, 2021.

marijuana stocks Hand gently holding rich soil for his marijuana plants
Source: Jetacom Autofocus / Shutterstock.com

Luke Lango and the InvestorPlace research staff aptly described High Tide as an “omnichannel cannabis retailer.”

Impressively, High Tide has roughly 85 stores spanning multiple Canadian provinces. Moreover, High Tide controls around 10% of the market in Alberta – not too bad for a small-capitalization company.

The fiscal data will show that High Tide ought to be on your radar. Plus, a value-added acquisition should prove that this little company is in hyper-growth mode.

HITI Stock at a Glance

So, how has HITI stock performed since its June 2 Nasdaq debut?

The shares opened on that day at $9.79, but then declined during the next few weeks. On June 18, the stock hit a short-term bottom of $7.

This was disappointing, no doubt. It’s a lesson for traders who tend to jump into a trade prematurely, instead of waiting patiently and seeing how the market reacts to an event.

Still, panic-selling wasn’t the right move, as HITI could be staging a comeback.

As of June 29, the share price had already climbed back up to $8.30.

And for folks who are just discovering this stock now, you might have a chance to own the shares at a discount, in anticipation of higher prices in 2021’s second half.

Brands That Connect

The best way to describe High Tide is as a brand builder in the cannabis industry.

The company’s cannabis-focused retail brands include Canna Cabana, Kush Bar, New Leaf and META.

Furthermore, High Tide has a vast online presence as its Grasscity.com e-commerce platform is visited by more than 20 million consumers per year.

As a result, Grasscity.com is (according to High Tide) the highest-traffic and most visible brand in the industry. Yet, many traders have never heard of this company.

Plus, the company expanded its market footprint even more when High Tide took an 80% stake in Fab Nutrition and when it acquired a Canna Cabana store in Toronto.

But, are High Tides’ brands connecting with the customers? The data indicates that the answer is definitely yes.

During the second fiscal quarter of 2021, High Tide nearly doubled its revenues (technically, it was a 99% increase) on a year-over-year basis, to $40.9 million.

Nearly as impressive was High Tide’s quarterly gross profit, which increased by 93% year-over-year to $15 million.

Enhancing the Platform

On top of that, High Tide demonstrated its solid fiscal position with $29.4 million in cash on hand as of April 30, 2021.

That’s quite an improvement over the $7.5 million counted as of Oct. 31, 2020.

President and CEO Raj Grover commented that he was “extremely proud” of High Tide’s quarterly results, “especially given the macro backdrop we faced.”

Most likely, Grover was referring to the operational challenges posed by the Covid-19 pandemic.

In case all of that positive data wasn’t enough, here’s more evidence that High Tide is expanding aggressively.

Specifically, the company just added a top e-commerce platform to its portfolio. It’s known as the Daily High Club, and it has more than 15,000 subscription box members.

The Daily High Club should bolster High Tide’s online presence considerably. With it, High Tide will gain access to Daily High Club’s nearly 800,000 Instagram followers and more than 75,000 TikTok followers.

Amazingly, over 1 million accessories have been sold under the Daily High Club name. So clearly, High Tide is adding a proven e-commerce platform to its already considerable cannabis-market holdings.

The Takeaway on HITI Stock

HITI stock could be one of those cannabis stocks that’s under the radar for now, but set to explode soon.

And given the company’s rapid expansion and strong revenue growth, High Tide looks like a high-value investment for the long term.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.

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Article printed from InvestorPlace Media, https://investorplace.com/2021/07/near-doubled-revenues-show-hiti-stock-is-a-canna-biz-contender/.

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