GreenGro Technologies: Prohibition Ends; Gold Rush Begins - RichardACox/financialmarkets GitHub Wiki

When we are looking at the financial markets, there are not many sectors that are poised for growth in ways that are comparable to what is seen in the cannabis industry.  Recent election results have confirmed these trends at the political level, and recreational marijuana is now legal for roughly 20% of the US population.

In November of 2016, California legalized use, sale, and possession of cannabis and cannabis products.  As a result, cannabis stocks like GreenGro Technologies, Inc. (OTCMKTS: GRNH) hit annual highs in short order. Price spikes like these are creating massive opportunities for investors that are able to gain exposure at these undervalued levels.

GreenGro Technologies sells the things that cannabis suppliers need: grow rooms, greenhouses, and extraction labs. They supply everything to propagate and preserve cannabis products, but not cannabis. Like the general store owners who sold shovels to the 49’ers in the first gold rush, GreenGro intends to profit from the ambition and enthusiasm of eager new suppliers.

GreenGro's Product Base

GreenGro sells a 14’ x 24’ x 10’ Grow Room starting at $7499.00 and a commercial- sized Greenhouse starting at $100,000. Now that an individual may possess six marijuana plants in some states, and each plant might produce up to a pound of oily green flowers, that investment might be worth it for a regular consumer with the time and patience. A greenhouse, however, provided the proper licensing and zoning, might produce thousands of cannabis plants every few months. At just a dollar a gram, a 10,000 pounds of cannabis is worth about $5,000,000.

“As the industry continues to expand, so does our corporate vision, and market share,” says James M. Haas, CEO of GreenGro quoted in the Wall Street Journal on March 15th. Further, “To be horizontally diversifying at this stage in the industry continues to prove very lucrative."

Industry Expansion

$5,000,000 is about the price to get started with one of GreenGro’s 22,000 cannabis plant facilities. If one has an extra five million laying around in a forgotten passbook checking account, one might take a look. At a dollar a gram one might realize gross revenue in excess of $30,000,000.

GRNH has been trending generally lower since its peak of nearly $.15 just before the election. Over the past two months, it has held in a range between $.05 and $.07. Like others in this industry, GreenGro is “betting on the come.”  Now might be the moment for principal shareholders as a simple return to the previous highs would equate to stock gains of roughly 150%.

Terry Garrett, a cannabis analyst quoted in the New York Times on April 15, estimates that American consumers spend $50 billion per year on marijuana products. Currently, legal sales are but $7 billion. But history, here, might be the true indicator of what’s to come.  When prohibition ended in the 1930’s, bootleggers went out of business and corporations took over. So, too, may it be with the legalization of cannabis and the rise of early corporations like GRNH.