Topic: How To Invest

Q: What do you think of MediPharm Labs (TSXV LABS)? Is it a good investment or too high risk in your opinion?

Article Excerpt

A: MediPharm Labs Corp., $5.20, symbol LABS on the Toronto Venture Exchange (Shares Outstanding: 113.4 million; Market cap: $589.7 million; www.medipharmlabs.com), is a cannabis extraction company that produces purified, pharmacy-grade cannabis oil and concentrates. The company operates out of a 70,000-square-foot Barrie, Ontario, facility. MediPharm began trading in October 2018 at $2.40 per share. Since then the company has attracted equity financings of over $25 million and the stock has moved up to today’s price. Unlike most cannabis companies, MediPharm is not attempting to become a cannabis producer. Instead, the company has invested in state-of-the-art, supercritical carbon dioxide (CO2) extraction technology in order to specialize solely in cannabis oil extraction. That’s a higher-profit-margin, value-added segment of the cannabis industry. When supercritical CO2 (a liquid form of the compound) passes through cannabis in an extractor, it pulls out all the cannabinoids such as THC and CBD. There is no ethanol alcohol or butane used throughout the process. The resulting CO2 oil is an extremely…