Gregmal Posted March 2, 2020 Author Share Posted March 2, 2020 Just reading the tape, but if the markets find some stability, get ready for liftoff here. Price action last couple days has been insanely bullish. Just my 2c of course. Link to comment Share on other sites More sharing options...
JRM Posted April 15, 2020 Share Posted April 15, 2020 So, their business has been deemed "essential" in both markets where they operate. They are offering delivery service and have seen order sizes double. Wholesale business is strong. They can cover 2020 debt obligations with cash balance and they are profitable. What am I missing here? Link to comment Share on other sites More sharing options...
Gregmal Posted April 15, 2020 Author Share Posted April 15, 2020 So, their business has been deemed "essential" in both markets where they operate. They are offering delivery service and have seen order sizes double. Wholesale business is strong. They can cover 2020 debt obligations with cash balance and they a profitable. What am I missing here? No idea lol. 1x EBIDTA printed a few weeks ago. Can see the reasons this gets abandoned, but more perplexed than panicked myself. Link to comment Share on other sites More sharing options...
movys Posted April 16, 2020 Share Posted April 16, 2020 Adult-use recreational stores remain closed in MA through May 4. This is a huge source of revenue for AYR. Link to comment Share on other sites More sharing options...
Spekulatius Posted April 16, 2020 Share Posted April 16, 2020 The company was barely profitable in Q1 even after ignoring this huge stock compensation expense (hasn’t looked why it is so huge and if it will smaller). Not something I would invest in after a cursory view. Link to comment Share on other sites More sharing options...
JRM Posted April 16, 2020 Share Posted April 16, 2020 It is difficult for me to tell. I asked investor relations, and they indicated that the majority was related to the qualifying transaction; as part of the consideration for each company purchased was stock. The CEO has been maxed out in the amount of the company he can own since last summer (15%). Anybody know if these restrictions apply to others in management? Link to comment Share on other sites More sharing options...
spartansaver Posted April 21, 2020 Share Posted April 21, 2020 It is difficult for me to tell. I asked investor relations, and they indicated that the majority was related to the qualifying transaction; as part of the consideration for each company purchased was stock. The CEO has been maxed out in the amount of the company he can own since last summer (15%). Anybody know if these restrictions apply to others in management? Spoke to IR about SBC. The way he described it is that when the company made the acquisitions it used stock. Accounting standards require the company to amortize the stock based part of the acquisitions. The shares have already been issued, so the majority of the SBC isn't new shares, it's old shares getting amortized. I was initially skeptical about adding back SBC, but think its a fair practice in this case. I worry a bit about the company acquiring just to get larger. When I asked "why do you want to acquire other companies?", IR was confused. His answer... "to grow." Overall I've come to like the idea as it seems like a cheap valuation in an area people like to speculate in. Link to comment Share on other sites More sharing options...
Gregmal Posted April 21, 2020 Author Share Posted April 21, 2020 It is difficult for me to tell. I asked investor relations, and they indicated that the majority was related to the qualifying transaction; as part of the consideration for each company purchased was stock. The CEO has been maxed out in the amount of the company he can own since last summer (15%). Anybody know if these restrictions apply to others in management? Spoke to IR about SBC. The way he described it is that when the company made the acquisitions it used stock. Accounting standards require the company to amortize the stock based part of the acquisitions. The shares have already been issued, so the majority of the SBC isn't new shares, it's old shares getting amortized. I was initially skeptical about adding back SBC, but think its a fair practice in this case. I worry a bit about the company acquiring just to get larger. When I asked "why do you want to acquire other companies?", IR was confused. His answer... "to grow." Overall I've come to like the idea as it seems like a cheap valuation in an area people like to speculate in. Sandelman touches on the acquisition focus on the calls, especially IIRC last Novembers. Of course this is just what he "says", but he seemed quite adamant they have no desire to take on other companies problems or jeopardize their profitability and any deal that would is a non starter. He's the largest shareholder here, and I dont think they are looking to do anything crazy. These market conditions are heavily favorable to a company like this. Link to comment Share on other sites More sharing options...
spartansaver Posted April 21, 2020 Share Posted April 21, 2020 It is difficult for me to tell. I asked investor relations, and they indicated that the majority was related to the qualifying transaction; as part of the consideration for each company purchased was stock. The CEO has been maxed out in the amount of the company he can own since last summer (15%). Anybody know if these restrictions apply to others in management? Spoke to IR about SBC. The way he described it is that when the company made the acquisitions it used stock. Accounting standards require the company to amortize the stock based part of the acquisitions. The shares have already been issued, so the majority of the SBC isn't new shares, it's old shares getting amortized. I was initially skeptical about adding back SBC, but think its a fair practice in this case. I worry a bit about the company acquiring just to get larger. When I asked "why do you want to acquire other companies?", IR was confused. His answer... "to grow." Overall I've come to like the idea as it seems like a cheap valuation in an area people like to speculate in. Sandelman touches on the acquisition focus on the calls, especially IIRC last Novembers. Of course this is just what he "says", but he seemed quite adamant they have no desire to take on other companies problems or jeopardize their profitability and any deal that would is a non starter. He's the largest shareholder here, and I dont think they are looking to do anything crazy. These market conditions are heavily favorable to a company like this. I hope so... Some incentives seem aligned, others I'm not sure. Maybe someone can add color if they've gotten more specifics. When I asked about how management is compensated, IR said that incentives haven't been filed. He said incentives are likely aligned to EBITDA. I asked "EBITDA per share"? His response, "No I think just consolidated EBITDA." Hopefully he's wrong and just hasn't spoken to management about the topic. Link to comment Share on other sites More sharing options...
Gregmal Posted April 21, 2020 Author Share Posted April 21, 2020 I'd certainly hope so. They had a buyback in place, although I dont recall if they ever used it, at about $12 CAD. Even if they arent using it here, it'd be a pretty big leap to justify issuing stock at $7. All this said, I've never met a CEO or management team that told you "we're going to wreck the company making acquisitions". Sandelman has a financial background, so I know he gets it. But people with financial backgrounds also "get" how to maximize their pay as well. As soon as MA opens back up sales will be astronomical. I'd also gander the shut down impaired and or finished off quite a few rinky dink pot companies. Link to comment Share on other sites More sharing options...
spartansaver Posted April 21, 2020 Share Posted April 21, 2020 I'd certainly hope so. They had a buyback in place, although I dont recall if they ever used it, at about $12 CAD. Even if they arent using it here, it'd be a pretty big leap to justify issuing stock at $7. All this said, I've never met a CEO or management team that told you "we're going to wreck the company making acquisitions". Sandelman has a financial background, so I know he gets it. But people with financial backgrounds also "get" how to maximize their pay as well. As soon as MA opens back up sales will be astronomical. I'd also gander the shut down impaired and or finished off quite a few rinky dink pot companies. Bold is what I most worry about. His 12.5% ownership seems impressive, but also means influence. Hopefully his influence is used for the betterment of all shareholders. EMMS CEO Jeff Smuylan owns a 10% economic interest in EMMS. But, he's created a scenario where the incentives are much more aligned to the CEO than shareholders. He is able to keep it this way through his influence (51% voting interest). Link to comment Share on other sites More sharing options...
spartansaver Posted April 22, 2020 Share Posted April 22, 2020 https://ir.ayrstrategies.com/news-events/press-releases/detail/35/ayr-strategies-provides-business-update Link to comment Share on other sites More sharing options...
villainx Posted April 22, 2020 Share Posted April 22, 2020 https://ir.ayrstrategies.com/news-events/press-releases/detail/35/ayr-strategies-provides-business-update That sounds not negative. Link to comment Share on other sites More sharing options...
spartansaver Posted April 22, 2020 Share Posted April 22, 2020 https://ir.ayrstrategies.com/news-events/press-releases/detail/35/ayr-strategies-provides-business-update That sounds not negative. That's how I also took it. They are still remaining profitable, and capital isn't getting impaired. I'm concerned a bit that the delivery operating isn't going as smoothly as management articulate. If you go on Google reviews AYR Nevada dispensaries are getting hit with lots of negative reviews about deliveries. The reviewers discuss: missed deliveries, wrong orders, long wait times, etc. I understand that this is completely new and everyone is trying to adjust, but wonder if it is impairing the dispensary brands at all. Link to comment Share on other sites More sharing options...
JRM Posted May 13, 2020 Share Posted May 13, 2020 Came across this: https://seekingalpha.com/article/4347092-100-billion-cannabis-market-podcast Link to comment Share on other sites More sharing options...
villainx Posted July 10, 2020 Share Posted July 10, 2020 Ayr Strategies Previews June and Second Quarter 2020 Results: https://ir.ayrstrategies.com/news-events/press-releases/detail/39/ayr-strategies-previews-june-and-second-quarter-2020-results Link to comment Share on other sites More sharing options...
Gregmal Posted July 10, 2020 Author Share Posted July 10, 2020 Ayr Strategies Previews June and Second Quarter 2020 Results: https://ir.ayrstrategies.com/news-events/press-releases/detail/39/ayr-strategies-previews-june-and-second-quarter-2020-results Yup... $5M adjusted EBITDA for the MONTH and records for the Q despite shutdown. These guys are good, and the business is great. Unfortunately, since I am involved, this continues to be the only SPAC not up 600% of late. Link to comment Share on other sites More sharing options...
villainx Posted August 12, 2020 Share Posted August 12, 2020 Was wondering about the recent AYRSF run up. This came out yesterday: https://ir.ayrstrategies.com/news-events/press-releases/detail/40/ayr-strategies-positioned-to-expand-footprint-in-nevada. Sounds like 2 more dispensary licenses in NV. Link to comment Share on other sites More sharing options...
Gregmal Posted August 12, 2020 Author Share Posted August 12, 2020 Yup. I was just gonna keep my mouth shut, as I always jinx it. But Sandelman is a bit of a bossman. Either that or selling pot is a great business. I probably think its the later more than the former. But as a shareholder....no complaints here. Link to comment Share on other sites More sharing options...
rkbabang Posted August 12, 2020 Share Posted August 12, 2020 Was wondering about the recent AYRSF run up. This came out yesterday: https://ir.ayrstrategies.com/news-events/press-releases/detail/40/ayr-strategies-positioned-to-expand-footprint-in-nevada. Sounds like 2 more dispensary licenses in NV. Only one that is useful though. “Our goal is to open the additional Clark County dispensary this year. And although there is currently a moratorium on opening new dispensaries in Henderson, we are pleased to have an additional Henderson license should the moratorium be lifted in the future." Link to comment Share on other sites More sharing options...
Gregmal Posted August 13, 2020 Author Share Posted August 13, 2020 Stifling competition could also be a good thing. High barriers to entry for a low barrier to entry biz is definitely part of the secret sauce here. Especially in MA. I am not an expert on the licenses, but there could also simply be a market for sitting on them. Where I live, liquor licenses are impossible to get. There's 19 total issued. Theres maybe a fraction of that number of actual stores. A select group of people own a handful. The going rate is about 3x what it costs to buy one from the town; IF the town chooses to issue you one...which is, as I said, a non starter. Link to comment Share on other sites More sharing options...
Gregmal Posted August 26, 2020 Author Share Posted August 26, 2020 https://ir.ayrstrategies.com/news-events/press-releases/detail/42/ayr-strategies-reports-financial-results-reaches Oh boy. Link to comment Share on other sites More sharing options...
villainx Posted August 26, 2020 Share Posted August 26, 2020 In a positive way, right? https://ir.ayrstrategies.com/news-events/press-releases/detail/42/ayr-strategies-reports-financial-results-reaches Oh boy. Link to comment Share on other sites More sharing options...
Gregmal Posted August 26, 2020 Author Share Posted August 26, 2020 Yea. I like PA, looks a lot like MA in terms of the market. I would wager Connecticut is one of the others theyre looking to move into. Both should simply be appetizers as they setup for recreational legalization that should occur within the next year or two. Good mix on the financing as well. Link to comment Share on other sites More sharing options...
villainx Posted August 27, 2020 Share Posted August 27, 2020 Quickly going through the transcript, a couple of questions: 1, how are they coming up with the cash for acquisitions? Just thinking about dilution, if it comes to that. They mentioned cash, on free cashflow generation ... but you still want to have some cash at the end of it all. 2, PA is going to come online when? Licensed but not operational, right? 3, I guess no more buybacks, that was on the table several months ago, right? Any thoughts on price of acquisition(s)? Yea. I like PA, looks a lot like MA in terms of the market. I would wager Connecticut is one of the others theyre looking to move into. Both should simply be appetizers as they setup for recreational legalization that should occur within the next year or two. Good mix on the financing as well. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now