• Moderators, please send me a PM if you are unable to access mod permissions. Thanks, Habsy.

Hey Nerds: Blockchain

It's not a requirement, but being a consumer of a product lets me understand something about it beyond the numbers. I feel like I don't even know the most basic issues to consider in attempting to figure out which company is better than the others. (And unlike you guys, I don't really like the casting a wide net approach - I like to try to pick the winner and live and die by that).
 
LeafOfFaith said:
It's not a requirement, but being a consumer of a product lets me understand something about it beyond the numbers. I feel like I don't even know the most basic issues to consider in attempting to figure out which company is better than the others. (And unlike you guys, I don't really like the casting a wide net approach - I like to try to pick the winner and live and die by that).
Click to expand...
Yeah you would have gotten killed in the sector. Odds are you would have picked a loser since most of these companies were failures. The appeal was riding the hype, keeping an eye on shit, bailing at the first sight of red flags, and riding the companies that lack the red flags. GTII was that company for me. I picked losers too though.. The key was bailing before I got too hurt from them.

As for the product... I mean it's drugs. It's not that complex. I feel like being a user would uhhh cloud my judgment if you know what I mean.
 
100% I would have lost. I still feel that way though. Or have these few companies you guys talk about separated themselves from the pack? Like the one that I was following long before we all started discussing in here was Canopy, and that seems to have gotten killed. If I would have gone with one before, it was that, because every article I read talked about it.

Also, if drugs are drugs, then what's the distinguishing factor between any of these companies?

And how are you feeling? Are the headaches dissipating?
 
LeafOfFaith said:
100% I would have lost. I still feel that way though. Or have these few companies you guys talk about separated themselves from the pack? Like the one that I was following long before we all started discussing in here was Canopy, and that seems to have gotten killed. If I would have gone with one before, it was that, because every article I read talked about it.

Also, if drugs are drugs, then what's the distinguishing factor between any of these companies?

And how are you feeling? Are the headaches dissipating?
Click to expand...
Getting in Canopy like 5 years would have been incredible. I believe ME retired on his MJ gains and Canopy was a very big part of that. I would have screamed at you to bail once I saw how badly Canada fucked up the roll out. It was very clear to me just months after legalization that it would just not work out. But for Canopy it's all about the US. Still a very speculative play, but that is not a cheap stock. They are backed by Constellation Brands. I will always pay attention to them just for that reason. Constellation is the real deal. But Canopy is bleeding money right now. So I'm out.

Distinguishing factor: First and foremost being in the US and not Canada (business conditions are infinitely better for the companies and the market is way larger despite the product not being federally legal). Branding, quality of product (though based on the success of alcohol companies I think that's overrated), and most importantly balancing expansion across several states with not blowing your load too much and being in severe debt that will bury you or diluting the fuck out of shareholders. The leaders are profitable or close to profitable and growing 25+% QOQ. The losers are walking a tightrope doing everything they can to preserve cash and not dilute and not really growing (and some are so balls deep in debt that they've effectively gone to $0). The lead that the big boys have on the others have increased a fuckton in the last year or so. From the beginning GTII was careful, calculated, diluted shareholders at opportune times, didn't expand too quickly but also expanded enough to grow exponentially. They were amazing at winning licenses in key, profitable states (which is the cheapest way to get into these states with limited licenses available; other companies are forced to acquire which mostly results in dilution) and they penetrated them deeply in a very nonsexual way to become leaders in said states. That was the way to go. Essentially laying the ground work years ago told the tale of how these things will go. And the gaps have gotten wider and wider. We can see clear leaders now.


Headaches still there. No fever at all today. I'm good.
 
Last edited:
As for Trulieve... Sorry but their success is about 50% based on Prestoluck thanks to Florida's amazing capitalism-friendly legislation. Being profitable and enormous enough to expand while the smaller players sit by being small and barely surviving is what America is all about. That plus having limited licenses in the state so there's as little competition as possible. And vertical integration? Beautiful. THANK YOU CAPITALISM! But they were leaders there early on and had a nice operation so kudos to them for that. It's just amazing how successful they've been just in one state, even with that kind of growth in the state. Just a crazy market share that you'd be hard pressed to achieve in any other state. Right state at the right time! You need to have Prestoluck to do what they've done.

Luck played a role in all of them but no one more than Trulieve.
 
Last edited:
All good info, thanks. But are you saying TRUL is just pure luck, and the rest still just speculative as fuck? Like are these few holdings actual leaders with moats, or can they be knocked off their horses pretty easily?
 
LeafOfFaith said:
All good info, thanks. But are you saying TRUL is just pure luck, and the rest still just speculative as ****? Like are these few holdings actual leaders with moats, or can they be knocked off their horses pretty easily?
Click to expand...
Canopy is more speculative because they don't make money but they have big money backing them. Not my kind of investment. GTII isn't as much anymore. They're horses. Same with Trul. They got lucky but that doesn't mean they're not monsters. Luck is required in a lot of cases to be a successful business.

I can't see them being knocked off, at least not anytime soon. They're well oiled machines. Legitimate businesses. And the stocks are cheap.

The only semi concern is if they legalize federally and legislation isn't capitalism friendly; maybe the barrier to entry decreases and competition increases. Can't really see it and that's a long long way away if it happens. By the time they legalize these companies may be $10b powerhouse corporations. Many will be bought out by big alcohol or big tobacco at huge premiums imo.
 
I don’t think it’s luck at all. TRUL are playing (and thriving) by rules made by a third party.

Luck is Google trying to sell their algorithm to Yahoo for $1M and being told to fuck off.
 
CH1 said:
I don’t think it’s luck at all. TRUL are playing (and thriving) by rules made by a third party.

Luck is Google trying to sell their algorithm to Yahoo for $1M and being told to **** off.
Click to expand...
Luck was being early movers in a state with limited licenses and vertical integration. They could have just as easily been in California which is a larger market but has absolutely brutal legislation for these msos. Zero barrier to entry. The companies that pushed hard there early got burned. It's the shit stain of every MSO operation that has exposure there. It was once the hottest spot to expand to (everyone wanted in) but the market never really improved. But yes, of course trulieve did a great job capitalizing on the beautiful hand they were dealt. No doubt.
 
  • Like
Reactions: CH1
Yeah. California messed up, but they are the outlier, no? Every other state seems MSO friendly... but I don’t follow that stuff as closely as you.
 
CH1 said:
Yeah. California messed up, but they are the outlier, no? Every other state seems MSO friendly... but I don’t follow that stuff as closely as you.
Click to expand...
Colorado isn't really. Neither is Michigan. Limited licenses and vertical integration is the key because that's what creates the arms race we're seeing in florida, Illinois, PA etc. They're all building out aggressively as supply has not caught up to demand yet. Eventually it will and prices will decrease, but we're far off from that it seems. Not every state has both limited licenses and vertical integration so competition can be fierce in some states which is killer. California is the best example of that. East coast is great. PA, NY etc. Illinois is obviously great. But some states are certainly better than others.
 
  • Like
Reactions: CH1
Yeah, that’s what I thought. So better for the consumer but not as good for the businesses and government coffers.

this slow heavy handed roll out is great for our folios.
 
Barriers to enter is the key for these corporations. Buncha states are doing it right. US for the most part looks after their corporations so I trust they'll do the right thing once they legalize federally.
 
CH1 said:
wow! $30 CDN per gram. How is that sustainable?
Click to expand...
It's not. Demand >>> supply and that's mostly thanks to the limited licenses. Once supply = demand prices may drop a bit but not sure how much incentive they'll have to drop too significantly. Maybe just enough to steal market share from the black market (which apparently isn't cheap in Illinois either). Cresco thumb and Cura have well over 50% market share so might not be much of an appetite to decrease prices too much. But anyway Cresco is building out the most aggressively in Illinois. They'll do really well the next couple quarters.

But yes in a mature market margins will decrease but that's more than offset by the additional sales they'll get. A mature Illinois likely means four times the amount of revenue they're currently at. Probably around $4b. At this stage I see no reason why they can't sustain that market share in the current setup. Even if it drops a touch they'll still do more than fine. Anyway that's just one state. Wait till Florida goes rec legal. A mature rec legal Florida (if we use Colorado as an example) likely does close to $10b annually in sales.

And then there's PA. And NJ. And NY. And Ohio
 
  • Like
Reactions: CH1
You must log in or register to reply here.
Back
Top