PetroTech Oil and Gas Inc.’s (OTC Pink: PTOG) stock volume on Feb. 27 soared as 38,243,312 shares changed hands, more than three times its three-month average volume of 11,961,785 shares.
The sudden surge in stock volume for the oil recovery company is being fueled by its entry into the legal-marijuana business.
Going Into Legal Marijuana Production
On Feb 26, PetroTech announced it has expanded Cannabis and Hemp production and distribution channels in states of Washington and Colorado. The company said it has secured a Medical and Recreational License from the state of Colorado, and has signed on six licensed growers, as well as three additional growers in Washington. They are currently negotiating to lease warehouse space in Tacoma, Washington, and a dispensing storefront in Telluride, Colorado.
As a result, PetroTech has increased its projected production capacity to a minimum of 60-70 pounds per state, per month, with an average market price of $3,000.00 per pound.
On Feb. 27, PTOG share price closed at 3 cents, down 1 cent from its closing price of 4 cents the previous day.
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Advanced Cannabis Solutions’ Share Value Retreats
Just one day after, Advanced Cannabis Solutions (OTCQB: CANN) stock share price soared 62.09 %, on Feb. 27 it gave back 10.46 % of that gain.
Advance Cannabis Solution’s stock continued to soar with 358,241 changing hands, near times its three-month average volume of 137,715 shares.
The Colorado Springs, Colo-based company that leases growing space and related facilities to licensed marijuana business operators has seen its share value nudging upward over the last month.
Good News Reaches Critical Mass
The upward trend, which reached critical mass Feb. 26, is being fueled by a spate of positive news coming from the company.
On Feb. 20, Advanced Cannabis Solutions said it has signed an agreement to provide comprehensive consulting services to a significant investor group in Canada. This group is involved in the start-up and operation of a large cannabis production operation serving the Canadian medical marijuana marketplace. The contract has a minimum duration of six months and a potential value in the low six figures.
In addition, the company that is headquartered in the middle of one of the first, vibrant legal-marijuana marketplaces in the country has recently been approved for a major line of credit.
These two elements are essential for Advanced Cannabis Solutions to be able to build and equip the facilities it wants to rent to cannabis growers.
In Colorado alone, the medical marijuana market is estimated to be $350 million in size while the legalization of recreational marijuana could expand that figure to over $500 million in 2014 by some accounts. These figures are significantly larger throughout the United States. Some analysts estimate the total market at between $10 billion and $120 billion per year in size, depending on the success of various legalization efforts and the components included in the estimates.
New 30-Million Credit Line
On Jan. 21, Advanced Cannabis Solutions announced that it had established a $30-million credit line.
According to a release, Advanced Cannabis Solutions signed a definitive agreement with Full Circle Capital Corp., a closed-end investment company. The agreement provides that the investment fund will initially provide $7.5 million to the company in the form of Senior Secured Convertible Notes, subject to certain conditions. An additional $22.5 million can be borrowed by Company with the mutual agreement of the company and the investment company.
At least 95% of the loan proceeds will be used to acquire properties, which the company consistent with its business plan, will lease to licensed cannabis growers.
"The six-year loan will be secured by real estate acquired with the loan proceeds, and will require interest-only payments at a rate of 12% per year," the release explained, outlining the agreement.
On Feb. 27, CANN share price closed at $29.10, down $3.40 from its closing price of $32.50 the previous day.
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Cannabis Science Negotiates $1 Million New Financing
A developer of cannabis-based pharmaceutical products Cannabis Science Inc. (NASDAQ OTC: CBIS) announced Feb. 20 that it has negotiated $1 million in new financing.
According to Cannabis Science, it is raising the $1 million through private placement. The pricing is set at $0.25 per share for 144 restricted shares coupled with a one-year warrant for $0.50 per share to comprise a complete unit offering.
“The financing is being headed by affiliates and associates followed by an assorted group of individuals that have shown a strong interest in moving Cannabis Science's projects forward immediately,” the press release stated. “Initial commitments exceed $100,000.00 and the Company has received the first $50,000.00,” it added.
On Feb. 13, the company announced its new partnership with Michigan Green Technologies, LLC formed to actively lobby for the legalization of hemp and cannabis in President Obama’s home state of Michigan.
Robert Kane, Director and CFO of Cannabis Science, stated, “Michigan has always been an important market, and with a population twice the size of Colorado's, we see many opportunities ahead through our new venture with Michigan stakeholders."
Cannabis Science has been lobbying hard for the decriminalization of cannabis research, which is definitely makes it a player that is serious about developing products in a timely and safe fashion.
Before it began its focus on Michigan, Cannabis Science has and continues to systemically lobby Congress.
Lobbying Hard to Make Cannabis Research Possible
The company's government relations team lead, Rick Blake, is working with the U.S. House of Representatives' Cannabis Caucus to ensure that President Obama signs an Executive Order to decriminalize cannabis research. This is one of the bipartisan initiatives of the members of the Cannabis Caucus being facilitated by Cannabis Science. In contrast to many other countries Cannabis Science believes the regulatory landscape of the United States creates unreasonable restrictions on the ability of scientists and physicians to explore promising patient-driven research involving cannabis and cannabinoids.
“Thousands of patients are awaiting the President's action to set cannabis research free,” said Director and CEO of Cannabis Science Dorothy Bray, in a Jan. 29 written statement.
The Colorado company announced on Jan. 16 that it is spearheading an observational clinical research study in 2014 focusing on the use of cannabis and cannabis-based products to treat a variety of medical conditions.
“We will work with full authorization of the regulatory authorities and, most importantly, with the approval from patients,” said Cannabis Science President Robert Melamede.
But in addition to lobbying, Cannabis has made some pretty savvy vertical product moves as well.
Selling Equipment in Canada and Abroad
On Feb 3, Cannabis Science announced it would be partnering with MDS, a subsidiary of Medbox, Inc. to sell and distribute equipment to be used in the medical-marijuana industry. Under the terms of the agreement Cannabis Science has a 50/50 gross profit exclusive on any and all MDS equipment sales in Canada and other select markets, according to the release Both Cannabis Science and MDS have multiple opportunities in Canada based on recent developments with medical cannabis in that market. Other countries will follow pursuant to the agreement as Cannabis Science moves forward aggressively in Europe and South America.
CBIS share price closed at 17 cents on Feb. 27, down 1 cent from its closing price of 18 cents the previous day.
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To Provide Armored Marijuana Transport Services
Meanwhile, Medical Marijuana Inc. (OTC PINK: MJNA) hasn’t made any major announcements since Feb 5 when its subsidiary was expanding global sales based of tis industrial hemp-based cannabidiol (CBD) oil.
Medical Marijuana’s continues to employ a formidable diversified strategy in order to establish a foothold in this burgeoning industry.
For example, on Jan. 31 the San Diego holding company said that it had entered into an agreement with an unnamed company to sell Medial Marijuana’s anti-aging cream through the unnamed company’s in-home sales force.
According to the release, the first purchase order from the home-based business organization will be $1,072,251 in products that will ship before the end of the first quarter."
This positive news came a few days after Medical Marijuana announced its newly-formed subsidiaries would be providing armored transport services for companies in the cannabis industry.
Marijuana Inc.’s subsidiary, Wellness Managed Services, has gained this capability by purchasing a 50% stake in MPS International.
Cannabis Security Issue
In a written statement, MPS International’s CEO Mike Roberts outlined some specifics about the new armored marijuana transport service.
“Large amounts of product will be moved from grow to wholesaler, warehouse, testing facilities, bakeries, infusion laboratories and finally to retail locations,” Roberts said. “Post transaction, and especially right now with federal regulations prohibiting FDIC insured banks from offering financial services to cannabis industry businesses, large amounts of cash will need to be transported between parties securely as this creates an easy target for predators and competing businesses,” he added.
Potentially Lucrative Opportunity
In the release, Roberts went on to outline the potential opportunity that existed for providing armor transportation for currently legal cannabis businesses. He pointed out that there are now about 448 dispensaries in Colorado alone, while in California there are an estimated 2,700 dispensaries, co-operatives, wellness clinics, and taxi delivery services.
“Using an average of one armed security officer working 10 hour shifts, 7 days per week billing at the industry standard of $25/hour armed, 52 weeks per year, annual gross revenue created by just 11 locations is more than $1,000,000 for just static physical security,” Roberts explained.
Once the company establishes this footprint, it says it will evaluate other cannabis markets such as those in Canada.
On Feb. 27, MJNA share price closed at 30 cents, down 2 cents from its closing price of 32 cents the previous day.
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