The cannabis industry has grown by leaps and bounds over the course of the past few years and one of the most interesting companies to have emerged during that time is Namaste Technologies Inc (TSXV:N) (OTCQB:NXTTF). Namaste has emerged as one of the world’s leading cannabis e-commerce platforms and marketplaces. A wide range of cannabis products and accessories are sold on its platforms on a daily basis.
One of the most important developments in the cannabis industry in recent months has been the legalization of cannabis derivative products in Canada. Cannabis 2.0 sees Namaste well-positioned to take advantage of the upcoming growth in the cannabis sector.
6 Key Points for Namaste Technologies Inc (TSXV:N) (OTCQB:NXTTF)
- Namaste Technologies Inc. (TSXV:N) (OTCQB:NXTTF) owns multiple subsidiaries that have attractive growth prospects.
- On January 13, 2019, Choklat Inc., which Namaste holds a 49% equity ownership in, was granted a processing license from Health Canada to produce a line of chocolate bars, drink mixes and infused sugar.
- The company is focused on capitalizing on high-margin verticals within the cannabis sector and represents an exceptional opportunity for Cannabis 3.0.
- Namaste has a strong presence in the Canadian cannabis market and has been working strategically to penetrate international markets.
- The shares have been under pressure on broader market weakness and offer a better risk-reward profile right now.
- Over the course of the past few sessions, Namaste stock has performed admirably and has established itself as a rebound play.
Namaste Technologies’ (TSXV:N) (OTCQB:NXTTF) stock has shown an impressive rally over the past 2 weeks, with a gain of about 42%. What’s more interesting is that the recent rally was driven by a sharp increase in daily volume.
The stock reached a 3-Month high of C$0.52 today.
The stock had witnessed big volume in the first three trading sessions of the year. In fact, on January 1st, the stock had a single day jump of 32% with more than 4.15 million shares (on the TSE) changing hands – More than 4X its 30-day average volume of about 1 million shares.
Moreover, on January 2nd, 6.5 million shares were traded – this was the stock’s highest trading volume since September 10, 2019.
The stock has formed the “V-Shaped” recovery pattern and is now trading above the breakout zone of $0.41.
Based on the recent price movements, Namaste stock has strong support between C$0.34-C$0.36 (which is also it’s 50-Day Moving Average price).
As the stock is trading above the 50-Day moving average, momentum is likely to continue and the stock may not face major hurdles before $0.52 (200-Day MA).
Namaste Technologies (TSXV:N) (OTCQB:NXTTF) Awarded BUY and STRONG BUY Ratings – Substantial gains in the first week of January, and shares were beginning to stagnate. Investors and stock analysis websites alike have been showing their confidence in Namaste stock.
The technical analysis by Investing.com awarded Namaste a “STRONG BUY” recommendation based on 12 moving averages and 10 technical indicators: a unanimously positive recommendation from this site’s analysis.
Likewise, the technical analysis by TradingView gives them a “BUY” recommendation.
Namaste Technologies is Moving in the Right Direction
One of Namaste Technologies Inc.’s (TSXV:N) (OTCQB:NXTTF) crown jewels is CannMart, which provides customers with a comprehensive e-commerce solution for buying cannabis products from licensed producers. After some challenging times last year, Namaste has turned its business around comprehensively and could prove to be an excellent investment opportunity.
Forming Strategic Partnerships with Leading Brands
One of the most important things to point out with regards to the growth trajectory of Namaste is the role that is going to be played by its partners. In recent times, the company has managed to partner up with leading brands and one of the more strategic agreements that it has signed is the one with Phyto Extractions.
Licensing Agreement with Award Winning Cannabis Brand Phyto Extractions
On December 02, 2019, Phyto reached an agreement with Namaste’s majority owned subsidiary CannMart Labs and the particulars of the agreement are quite significant. By way of the agreement, CannMart Labs will be granted permission to use the Phyto trademark on some products that are sold on Namaste’s wholly owned subsidiary CannMart Inc.’s online marketplace .
Some of the products on which the trademarks could be used include cannabis tincture bottles, cannabis vaporizing pen cartridges, and batteries among others.
CannMart is looking to expand quite aggressively as it tries to take over a large portion of the cannabis e-commerce space. In order to achieve that, the company is actively looking to partner with leading brands in the industry. However, it should be noted that Namaste is particularly interested in companies that manufacture cannabis derivative products.
Considering the legalization of such products in Canada late last year, it is a big opportunity and Namaste is determined to bring those products to its platform.
Choklat Was Granted a Health Canada License to Produce Cannabis-Infused Chocolate Edibles
In March 2019, Namaste had made another move with the long term trajectory of the cannabis market in mind. The company acquired a 49% stake in the premium chocolate manufacturer Choklat with a view of entering the edibles market. Namaste paid $1.5 million to pick up those shares.
On January 13th, Namaste Technologies Inc. (TSXV:N) (OTCQB:NXTTF) received a big boost when Choklat was awarded a Health Canada license to produce a line of chocolate bars, drink mixes, and infused sugar. This will further strengthen the company’s product offerings for the cannabis derivative and edibles market.
“Receiving the processing license from Health Canada is a significant achievement and milestone,” said Choklat CEO Brad Churchill in a statement, noting that the partnership will leverage the extensive B2B sales channels that Namaste’s subsidiary CannMart Inc has built.
“Our high-quality cannabis-infused bars and beverages will be based on our own chocolate recipe made from a special cocoa bean sourced from the jungles of South America. This is an exciting time for Choklat, CannMart and Namaste as we enter the competitive cannabis 2.0 landscape,” he added.
Moreover, Namaste said CannMart will be submitting up to 11 unique product SKUs to Health Canada for the new derivative product formats that the company intends to offer for sale in March.
Licensing And Manufacturing Agreement With TREC Brands Inc
On November 27th, CannMart entered into an important licensing and manufacturing agreement with leading company TREC Brands. By way of this agreement, CannMart is going to be focused on bringing some of TREC Brands’ leading cannabis products under WINK cannabis brand into its online platform. The WINK brand is well known for being popular with customers who are conscious about brands and CannMart probably hopes that the addition of these products is going to drive sales considerably.
According to reports, the company is going to sell cannabis flower products made by WINK in the province of Saskatchewan.
CannMart is interested in introducing premium cannabis products on its platform and Namaste is confident that this particular category of products can find a lot of traction in the rest of Canada. Also important to add; just a few months ago, CannMart managed to get an amendment to its license from Health Canada, by way of which it will now be able to sell oil concentrates online.
Agreement to Supply Cannabis Products in Ontario and Saskatchewan
Namaste has been working tirelessly towards tying up deals so that the company can grow across a range of verticals. While it has grown into a significant online cannabis marketplace operator, the company has also tried to expand into other areas.
On November 12th, Namaste announced that its wholly-owned subsidiary CannMart had reached a deal by way of which it is going to supply cannabis products to two provinces in Canada.
The company announced that CannMart had signed a supply agreement with the Ontario Cannabis Store and was registered with the province of Saskatchewan. By way of these agreements, the company’s products are now going to be made a part of the cannabis-related value chain in those two provinces.
Moreover, in September 2019, the company had also secured an order of pre-rolled cannabis products to British Columbia. This supply agreement further illustrates the growth trajectory of Namaste and also shows that it is growing across different segments.
Strong Balance Sheet
It is also important to point out that Namaste boasts a pretty strong balance sheet; another reason investors could do well to track the stock closely. At the end of August last year, the company had as much as $49 million in cash on its books. This gives the company the necessary legroom to invest in new opportunities as and when they present themselves.
2019 was a building year for Namaste Technologies on the growth front and experts believe that the company is going to do even better this year. Considering the fact that CannMart gives customers the option of buying a wide range of cannabis products from all around the world, it is hardly surprising that analysts are bullish about its prospects.
It should be mentioned that one of the most important drivers of growth are distribution networks and in that regard, Namaste has done well. Namaste Technologies currently boasts one of the best distribution networks in Canada.
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