Wednesday, May 18, 2022
Item 9 Labs (INLB)
Slowly Building Up
Item 9 Labs Corp. (OTCQX: INLB) is a vertically integrated cannabis operator and dispensary franchisor delivering premium products from its large-scale cultivation and production facilities in the United States. The award-winning Item 9 Labs brand specializes in best-in-class products and user experience across several cannabis categories. The company also offers a unique dispensary franchise model through the national Unity Rd. retail brand. Easing barriers to entry, the franchise provides an opportunity for both new and existing dispensary owners to leverage the knowledge, resources, and ongoing support needed to thrive in their state compliantly and successfully. Item 9 Labs brings the best industry practices to markets nationwide through distinctive retail experience, cultivation capabilities, and product innovation. The veteran management team combines a diverse skill set with deep experience in the cannabis sector, franchising, and the capital markets to lead a new generation of public cannabis companies that provide transparency, consistency, and well-being. Headquartered in Arizona, the company is currently expanding its operations space by up to 640,000-plus square feet on its 50-acre site, one of the largest properties in Arizona zoned to grow and cultivate flower. For additional information, visit https://investors.item9labscorp.com/.
Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
2Q Results. Item 9 Labs’ management announced total revenue of $6.6 million, an increase of 6% or $0.5 million over the prior year’s $6.1 million. We had forecasted $7.3 million. Gross profit was $2.7 million versus the prior year of $3.0 million. Net loss for the quarter was $3.9 million, or $0.04 per share, from last year’s net income of $49,020, or breakeven. Adjusted EBITDA decreased by $1.9 million to a loss of $0.9 million from income of $1.0 million last year.
Down the Path of Unity Rd. Highlights for Unity Rd. for the quarter include approval for plans and permitting for a dispensary in Maine, the expansion into Oklahoma in January, the first corporate owned Denver dispensary, and the asset purchase agreement for the Company’s future flagship dispensary and cultivation facility in Denver. All these events give credence to Item 9 Labs’ franchise growth strategy….
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.