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May 1, 2024, ST. PETERSBURG, FL – Water Tower Research (www.watertowerresearch.com) has published an Initiation of Coverage Report on CLS Holdings USA, Inc. (OTC: CLSH) titled, “Outperforming in Nevada; Expanding Nationally.” The report can be accessed here.
CLS Holdings is a vertically integrated cannabis company with core operations in Nevada. The company owns and operates Oasis Cannabis Dispensary, a popular retail cannabis store for locals and visitors. It is a ~2,500-square-foot recreational and medical dispensary in downtown Las Vegas. Oasis obtained a conditional cannabis consumption lounge license and plans to open the lounge later in 2024. City Trees is CLS’ extraction and manufacturing business, which produces a variety of extracts, oils, tinctures, capsules, cartridges, and pre-rolls.
CLS is using an asset-light approach to expand into new markets. It recently entered New Mexico, where it is licensing and manufacturing vapor cartridges and tinctures. We expect it to use a similar approach to expand its footprint in 2024. City Trees CBD is a revenue diversifier and enhancer. The new line is currently focused on CBD and sleep formulations enhanced with CBN and has the potential to expand into other rare cannabinoids. Because these products do not include THC, they can be distributed nationally.
The US cannabis MSOS ETF is in a drawdown that began on February 10, 2021, and peak-to-trough is still down more than 80%. So, within cannabis, we are comparing degrees of value. We compared CLS with a basket that includes Nevada companies and other similar-sized businesses to evaluate it. At just 0.55x LTM sales, CLS is 67.16% cheaper than the 1.68x average for the basket.
About Water Tower Research
Water Tower Research is modernizing Investor Relations through research-driven communications and Investor Engagement. Sound investment research begins with good information. At WTR, we help companies and investors connect by creating expert information flow and strategies that are the foundation of a successful modern investor relations platform. Our analysts and capital markets professionals bring decades of unrivaled Wall Street experience and insight to a new digital world of investor communications and engagement. Our research and investor content is distributed across traditional research aggregators like Bloomberg, FactSet, etc., proprietary direct distribution lists, social media, search engines, and our website. As a result, every institutional and retail investor has equal access to our high-quality company research. Our mission is to help companies take control of their IR program and proactively reach investors while bringing investors a consistent flow of quality information to help them understand our clients’ businesses, industries, and the investment opportunities they present.
