NEW YORK, NY / ACCESSWIRE / November 7, 2018 / SeeThruEquity, a leading independent equity research and corporate access firm focused on smallcap and microcap public companies, today announced it has initiated coverage HempAmericana, Inc.
(OTC PINK: HMPQ) with a price target of $0.03.
The report is available here: HMPQ Initiation Report.
We initiate coverage on HempAmericana Inc. (OTC: HMPQ, $0.01) with a price target of $0.03. HempAmericana, Inc. is focused on research, development, and sale of industrial hemp-based products, which include rolling papers and CBD oils. CBD is one of the more than 85 cannabinoids identified in marijuana and hemp plants and is non-psychoactive with wide array of therapeutic benefits. Hemp-derived CBDs provide a legal alternative to marijuana-based CBD (which is banned at federal level) and allows the consumer to reap the multiple potential health benefits of CBD without psychoactive effects. HMPQ is approaching completion of a new 17,000 square-foot facility in Augusta, Maine, which will be capable of producing and processing high purity CBD oil with zero waste for HMPQ under the brand Weed Got Oil, as well as white-label partners by the end of calendar 2018 We see several potential catalysts ahead, as the company began processing crude CBD in September and expects to commence fully automated production and bottling of high purity CBD during calendar 4Q18.
Highlights from the note include:
HMPQ enters fast-growing CBD oil industry with state-of-the-art production facility in Augusta, Maine
HMPQ has officially entered the CBD oil extraction space with the opening of its new zero-waste extraction and production facility in Augusta, Maine. The 17,000 square foot facility was purpose-built for CBD oil extraction and production and utilizes leading technology to capable of producing 99% pure CBD oil concentrate at scale. With the completion of the Augusta facility, HMPQ has begun processing its initial resource of 4,000 pounds of premium grade hemp. The company announced in October that it expected to receive the final equipment required to shift to fully automated extraction, production, refinement, distillation and bottling of high-grade proprietary CBD Oil for immediate distribution and sale, both for the company's brands and white label partners. Management expects to complete installation of new distillation and bottling equipment in November, which would position the company for revenues beginning in calendar 4Q18.
The company has already begun is investing commercialization efforts, with the launch of a new website, HempAmericana.com, as well as publicity efforts via a leading print media platform and social media. Specifically, HMPQ announced a partnership for coverage in leading cannabis print publication 'High Times Magazine.' The magazine boasts of strong circulation reach of approximately 236,000 monthly print subscribers, while its digital properties reach 20 million unique visitors every month.
Large opportunity for hemp-derived CBD
HMPQ aims to become an emerging provider of high purity CBD oil, which is believed to be among the most promising sectors of the wider cannabis market over the next 2-3 years. Indeed, the overall CBD market in the US is projected to reach $2.1 billion in 2020, according to the Hemp Business Journal, positioning it as the fastest growing segment within the multi-billion-dollar legal cannabis and hemp market. More optimistic estimates from The Brightfield Group project the global market for legal CBD could reach $22 billion by 2022, driven with the assumption of the passage of the Hemp Farming Act of 2018 (Farm Bill), which would clearly and unambiguously legalize hemp and its derivatives, extracts and cannabinoids, including hemp CBD.
Initiate coverage with a price target of $0.03
We see HMPQ as a speculative emerging growth company positioning itself to capitalize on the burgeoning legal cannabis and hemp market, targeting the fastest growing sub segment (hemp-derived CBD). HMPQ has made considerable progress toward establishing a top-tier CBD oil extraction and production facility, with processing of its initial resource of 4,000 pounds of premium grade hemp having already begun. Moreover, we see several potential near-term catalysts ahead as management has stated that it will have a fully-automated extraction, production, refinement, distillation, bottling, and white-labeling system at its 17,000 sq. ft facility in Augusta, Maine by the end of calendar 4Q18. The target of $0.03 represents a valuation of 19.7x 2019E revenues of $3.6mn and 7.2x 2020E revenues of $9.9mn.
Please review important disclosures in the report and on our website at www.seethruequity.com.
About HempAmericana, Inc.
HempAmericana is currently in the rolling paper and CBD oil business using the brand name Weed Got Oil. Search Rolling Thunders hemp papers on YouTube for a product demonstration of the Company's papers. The company owns an extraction machine and now plans to become a leader in the CBD oil market by establishing three laboratories for the extraction and research of the oils contained in the hemp plant. HempAmericana also researches, develops and sells products made of industrial hemp. HempAmericana.net.
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