Sundial Growers Looks Beyond Q4 2021 Earnings


SNDL stock - Sundial Growers Looks Beyond Q4 2021 Earnings

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Sundial Growers (NASDAQ:SNDL) recently announced it would file its annual report for 2021 by April 29. SNDL stock was recovering from a significant price drop in the first half of April. The delay stopped its stock’s momentum in its tracks.

Despite speculation the company would restate earnings or be dealing with some other troubling accounting issue, CEO Zach George is extremely excited about Sundial’s future.

Once its earnings are released and investors have digested the news, George is ready to continue executing its business strategy revolving around its two operating segments: Cannabis/Liquor and Investment.

It’s a much different company than when George took over in early 2020. Even though it trades around 50 cents, Sundial looks ready to begin punching above its weight.

In March, I argued that the company had to complete the Alcanna purchase because it was “vital to Sundial’s coast-to-coast Canadian cannabis retail ambitions.” On March 31, Sundial completed its acquisition. It is now the largest private-sector cannabis and liquor retailer in Canada. More importantly, it instantly makes Sundial cash-flow positive.

The CEO recently described the company’s transformation at the Benzinga Cannabis Conference in Miami:

“Over the last two years at the lows our market cap was less than $30 million, and at the high, it is greater than $3 billion. We have been able to transform the business at a very rapid clip,” Yahoo Finance reported the CEO’s statement.

As investors count down the days until Sundial announces its fourth-quarter and full-year results, there’s a lot to look forward to over the remainder of 2022 and into 2023. However, there’s also some work to be done, including executing a reverse stock split by some time in late July, or it will be delisted from the Nasdaq.

The three analysts covering Sundial have a loss estimate of 8 cents in 2021. What investors will look for from its Q4 2021 report is guidance around future profitability for both operating segments. Further, investors will want to know its plans for SunStream Bancorp, its joint venture investment vehicle, with Calgary-based SAF Group.

With good reason, SNDL stock investors can look beyond its Q4 2021 report with optimism. Phase two of Zach George’s plan is underway.

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On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.

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