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www.bloomberg.com

N.Y. Pot Legalization Gets Fast Track on Cuomo-Lawmaker Deal

New York is ready to legalize recreational marijuana. The state would impose special pot taxes and prepare to license dispensaries under an agreement reached by Gov. Andrew Cuomo and legislative leaders.
www.bloomberg.com www.bloomberg.com

The deal that legislative leaders brokered with Cuomo (D) would legalize cannabis use for adults 21 years old and up, and includes a 13% sales tax, 9% of which would go to the state and 4% to the localities, Krueger said. Distributors additionally would collect an excise tax of as much as 3 cents per milligram of THC, the active ingredient in cannabis, with a sliding scale based on the type of product and its potency.
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In general, there would be a three-tier licensing structure, separating growers, wholesalers and retailers similar to alcohol, though there would be certain exceptions allowing microbusinesses to be vertically integrated.
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Holy shit that's brutal. Not sure it's going to be a great market for MSOs in the end.
 
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On quick glance it's a nice beat by Cresco, particularly with their profitability. They've got their margins in check that's for sure. Two straight quarters of them getting their shit together on that end to immediately become a leader. Financials at this stage are almost identical to Green thumbs with a touch more debt.

$21.4m in cash generated from operations is big.
 
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Of course if you include bluma, they are likely #2 in revenues in cannabis. Entry into MA will provide a boost too. I think their growth picks up big time in the second half of 2021. Lotta expansion projects will be coming online.
 
Listening to the call. They have had 7 new institutional investors recently, $261m in cash (more than I thought!) thanks to a crazy $13m in free cash flow for Q4 which is insane considering the predatory taxation that these guys have to go through and steep ongoing capex. Revenue mix is 56% wholesale and 44% retail which is aggressively wholesale comparatively speaking. Based on what I've seen from the New York proposal it seems like wholesale will be the way to go there so they'll be well positioned. And of course, the entire industry is moving towards wholesale anyway. Build those brands baby.

Impressed. Still don't see many red flags with any of these companies.
 
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CH1 said:
hope we have a classic gap down followthru tmrw (used to be common but now rare) as I still have a decent amount of puts in VUZI and SE.
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Looks like I'll be getting my morning gap down to sell overnight puts....will be sniffing out longs at some point.

ES is now 3861...will look to go long at 3852 or 3840
 
One thing I'll say... I'm not sure what happened to Cresco's gross margin% after the impressive Q3. OpEx went up substantially and they haven't really addressed why. Bullish on them but there's your negative.
 
Their market cap is down to around $5b now. Margin concerns or not that's cheap for a company that will do over $1b in sales annually easily as soon as NY sales come online. For reference, Thumb is at $7b and $6b. Curious to see how low they can take it.
 
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CH1 said:
Looks like I'll be getting my morning gap down to sell overnight puts....will be sniffing out longs at some point.

ES is now 3861...will look to go long at 3852 or 3840
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I had my order in....but ES only went down to 54.5....so missed it by 2.5 points. Now 20 points higher., so missed a ripper.

On the plus side, I was able to get MSOS calls at the low
 
Had a bit of Columbia left but decided to sell when I saw it was up like 4%. Tanked immediately after; we'll see if that continues. Also exited the rest of my AYR at 38.80 which is hilarious. Wish I kept my entire trade position from this morning. But now scouting a new entry patiently.
 
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