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California’s legal cannabis industry continues to impress investors and many are looking for investment opportunities levered to this burgeoning market.
Demand for legal marijuana has exceeded expectations and many distributors are out of product. What we are seeing is something similar to what we have seen in Nevada, but on a much larger scale. This is a huge benefit for companies levered to this burgeoning market and today, we have highlighted a company that is focused on capitalizing on this opportunity.
High Hampton: A California Cannabis Stock
The company, High Hampton (CSE: HC) is focused on becoming one of the leading global distributors of cannabis products. The company is focused on increasing market share in California through a variety of strategic initiatives and agreements (i.e. equity, royalty, and direct property ownership with leasing agreements).
When it comes to cannabis investments, investor must take a look at the management team to determine if the company is led by solid operators. High Hampton is led by a proven management team and is comprised of experienced leaders with diverse backgrounds.
High Hampton benefits from a multi-faceted growth strategy and engages in finance, real estate, licensing, distribution, branding, and operations within the legal cannabis industry. The company provides professional management and advisory services through its capital markets team, compliance team, licensing team, and brands and products supply chain.
The company offers an attractive platform since its integrated vertical supply chain improves margins by lowering the cost of goods sold and operating costs of brands and operators.
High Hampton employs a selective growth strategy and its target acquisitions include industrial and commercial properties within “the zone” in cannabis-friendly municipalities, licensed cultivators, licensed distributors, industry magazines, apps, marketing groups, and highly sought-after brands.
Levered to the Coachella Cannabis Market
High Hampton is levered to the California cannabis market, which is expected to be the largest marijuana market in the world. High Hampton owns a 10.8 acre property in Coachella, California and is pursuing Conditional Use Permits (CUP) for cultivation and manufacturing (submitted applications in the fourth quarter of 2017).
High Hampton acquired the strategic property for less than $2 million and if the company is granted a CUP, it would significant increase the property value (comparable properties cost approx. $5.5 million). We are favorable on the company’s opportunity to be granted a license as High Hampton has engaged strategic partners to ensure that the buildout is executed flawlessly.
This represents an attractive opportunity for investors as the issuance of a CUP would be a catalyst for the company. We are bullish on the California cannabis market and favorable on High Hampton’s leverage to it.
Several Catalysts to Support Growth Initiatives
One of the reasons why investors need to keep an eye on High Hampton is due to the number of upcoming catalysts. The first half of 2018 could be significant for High Hampton and we are monitoring the shares closely.
During this time, the company expects to receive a CUP, and initiate and complete construction on the Coachella facility. As soon as construction is completed, High Hampton plans to commence cultivation activities and we are favorable on this opportunity.
We are bullish on the company’s growth strategy and focus on the California cannabis market. High Hampton is focused on increasing market share in California and we think this an attractive aspect of the story. We will monitor how the company continues to execute and keep you updated on important developments.