Quote from: stompix on September 19, 2018, 06:25:03 PM

Quote from: jaysabi on September 19, 2018, 02:59:49 PM

The other two companies, Aurora and Aphira, fund their operations by printing shares and devaluing current investors. I consider them to be the spam coin equivalent of the two larger companies. There are dozens of others, these are just four of the largest I consider to be the biggest players.

I should have read all of this before trying for 10 minutes to understand those numbers and how and why they've grown 94.75% in 3 months and 44.17% in six. Grin

But this is really a weird strategy, they are diluting their own shares if so and most of the money goes on acquisitions...

Quote

In January 2018, Aphria agreed to take over Broken Coast Cannabis, for $230 million in cash and stock
January 2018, Aphria agreed to buy Nuuvera, a Brampton-based cannabis company, for $826 million
In July 2018, Aphria announced it would acquire several South American cannabis companies for about $200 million

and this is only from wiki which sucks at financial stuff.
I really wonder who is putting that money in, 4 billion investment in a company based in a market that might reach 32 billion by 2022 is a bit of overkill.

Part of the reason these companies have to fund acquisitions through share issuance is because they are cut off from a lot of traditional loans and funding by virtue of their business. In the US, for example, none of these companies would be able to get a line of credit or even a bank account because any bank that deals with them would be violating federal law. So they fund acquisitions through the only currency they have available to them: their own stock. It makes sense logically, but it's not something you want to see as a stockholder because your ownership is being rapidly diluted.

As for the market potential, Canada is a very limited market (where these companies are based) but Tilray and Canopy have deals with European countries to export and Canopy is setting up overseas operations for a time when these countries would rather have domestic production over imports, so they are expanding their addressable markets. The US is a major untapped market but I feel like these prices already factor in full federal legalization and a mature market. The valuations are quite lofty.