It has been several weeks since we last checked in with Sugarmade, Inc. (OTCMKTS:SGMD) here on Street Register, and much has happened in that time, with respect to both the chart and the company’s business alike. The stock saw a low of .045 the day after our last mention, and ended up running to .43 (An increase of 855.5%) during the recent massive run on cannabis stocks. While the fervor has momentarily subsided with a pullback in many cannabis stocks today, SGMD included, that presents an interesting opportunity for new traders to enter the mix, or existing shareholders to average down their cost basis.
One thing is for sure, the cannabis boom in 2018 isn’t something that is going to slow down, even if we observe periodic course corrections with many of these stocks. That’s why we’re going to continue to remain interested in SGMD, especially with the big plans the company intends to execute, as outlined in some recent press statements.
Sugarmade, Inc. (OTCMKTS:SGMD) is now aiming to be the industry’s largest publically traded cannabis and hydroponics supply company by completing a master market agreement with industry leader, BizRight Hydroponics, Inc., a manufacturer and distributor to the hydroponics and cannabis markets. BizRight is expected to produce in excess of $30 million in revenues during 2017, with substantial growth expected for 2018.
“We plan to grow Sugarmade right along side the booming legal cannabis sector and this agreement with BizRight, which has been one of the fastest growing companies in this sector, moves Sugarmade and its investors much closer to this goal,” commented Mr. Jimmy Chan, Sugarmade’s CEO. “The implementation of this agreement will easily make Sugarmade one of the largest players in this growing marketplace. As California, and other state markets open up, we see a major opportunity to substantially grow our business operations.”
As part of the agreement, Sugarmade will compensate the owners of BizRight cash and Sugarmade common shares depending on revenue gained through the master marketing agreement. The full “earn out” of shares to be issued to the owners of BizRight will be obtain based on annualized revenues from the agreement of $30 million. Sugarmade is in process of significantly increasing its financial, accounting and managerial staffs in order to manage the expected significant increase in orders and transactions, and to manage future acquisitions within the cannabis sector, which are currently contemplated. Additionally, the Company will be acquiring additional office and warehouse space to accommodate expected order flow.
Mr. Chan continued, “It is an exciting time to be involved in this industry and we are certainly looking forward to the opening of California recreational marketplace, which should further boost our business. With Sugarmade and BizRight both being located in San Gabriel Valley, which is just outside of Los Angeles, we believe there are many other opportunities for our companies to work together. To this end, we have also acquired an option to buy the entire BizRight operation in the future.” (Source: PR Newswire)
We’re going to want to place an extra amount of focus on cannabis stocks representing companies that are doing business in California, as we’ve mentioned many times over the last several weeks. The end of marijuana prohibition took place this week, and companies are going to rush to fill the vacuum of the recreational market, to go along with what was already a thriving medical market. SGMD is one of those stocks that will get our close attention as that process moves forward. Keep it locked to Street Register for updates, and we’ll relay important developments on SGMD to you as they unfold. In the meantime, if you’ve yet to sign up for our 100% free newsletter, do so now! Just enter your active email address into the box below and submit!
Disclosure: No one at Street Register has been compensated in any way for the publishing of this article, nor do we hold any position in SGMD stock, short or long.