I started following GrowGeneration in late 2016 when it went public. I was intrigued by several factors that set it apart from other newly public companies trading on the OTC, including that it had revenue and that it had gone public through the “S-1 filing” approach rather than through a reverse-merger. Additionally, it sounded like a smart business model.
The stock has had a fantastic 2019, substantially outperforming the Global Cannabis Stock Index by rising 124% compared to the index gain of just 1.5%:
The emergence from a period of poor performance during 2018 began in May, and the stock has advanced sharply since then. I shared with my subscribers at 420 Investor in a post entitled “GrowGeneration’s Solid Start to 2019” that was later shared in the June edition of the 420 Investor Newsletter about my bullish outlook, concluding a year-end objective for the stock, then trading at 3.025, was $6.00-6.60. With the recent close above $5, we are well along that path, and I continue to expect it to obtain that goal.
GrowGen went public after beginning operations in 2014 when it acquired a chain of hydroponic stores serving the Colorado cannabis industry. It has expanded now to several additional states, including California, Maine, Michigan, Nevada, New Hampshire, Oklahoma, Rhode Island and Washington. The company has been expanding while also rationalizing its Colorado footprint, with smart acquisitions as well as new store openings in new markets.
One thing that I think supports investment in the stock has been the involvement of three cannabis-focused institutional investors, including Gotham Green Partners, Merida Capital and Navy Capital, each of who have invested in prior capital raises as well as the most recent one. In that last financing, additional institutional