GregFolin

$MDCL Shares Trigger Confluence Trend "Buy"

Long
OTC:MDCL   None
Medicine Man Technologies Inc (OTCMKTS:MDCL) shares have been ripping higher as the company continues to pile into an aggressive M&A roll-up strategy that could spell accelerating top-line growth for the company. Right now, the stock is trading at 14x sales, which puts it solidly in a sweet spot for momentum/growth strategies.

The company is capitalizing on recent changes in Colorado state law (namely, passage of HB 19-1090, which will take effect on November 1, and allow for outside investors, venture capitalists and private equity firms to gain investment access to Colorado’s cannabis industry. MDCL has been a well-respected and successful advisor and consultant to firms in the cannabis industry for many years. But this shift in the legal context has created a new opportunity to consolidate production and distribution under the MDCL umbrella in a roll-up that could produce significant revenue growth for a stock that is already cheap relative to peers in the space.

In all, the company has entered into binding term sheet agreements to roll up some bread and butter in the Colorado cannabis marketplace, including 12 cultivation facilities, 7 proprietary extraction facilities, 7 manufacturers of infused products, 33 strategically located retail dispensaries, and a state-of-the-art manufacturing, research and development lab that represents Colorado’s first and only active cannabis research license in the state.

That sets up the technical confrontation we see on the charts this week: Ichimoku trend buy signal is coming in confluence with the long term uptrend line dead on the money.