Is Planet 13’s (PLTH) Expansion a Smoking Buy Signal?
Planet 13 Holdings Inc (OTCMKTS:PLNHF, CNSX:PLTH) has dominated the Nevada market with its marijuana tourism destination SuperStore. The world’s largest dispensary dominates cannabis sales on the Las Vegas Strip. Planet 13 took its first step in becoming a multi-state operator (MSO), opening another SuperStore location in Orange County, California. That store is California’s largest dispensary complex. The company now has further plans to enter a couple more US markets in Florida and Illinois. With the sales in Planet 13’s Cali store ramping up, is the stock worth buying before the company takes on the rest of the United States?
The company’s financials are a good place to start. Planet 13 generated record revenue in July with sales of $11.9 million. $800 thousand of that from its new Orange County store (in just its first month). The company’s gross margins during that month were also in excess of 50%. Planet 13’s big margin products are its expanding in-house brands that they will continue to manufacture and sell in its great stores.
Planet 13 is also focused on expanding its flagship Las Vegas store:
“We’ve got another 7,000-8,000 sq ft. of production expansion and additional couple of storefronts we are going to build out. So, we are really excited about what it will do for the venue and the experience and basically double our cash registers bringing it to 85 registers in the new space. So, its going to be big, its going to be bold, its going to be over-the-top.” – Planet 13 Co-CEO Robert Groesbeck
Planet 13 Co-CEO also addresses 280E tax issues, and banking limitations as cannabis remains a schedule 1 drug. While cannabis is federally illegal, all cannabis operators are significantly affected as to how and where they operate.
“I think it’s imperative we get some federal relief. But, unfortunately, we can’t seem to get anything out of congress. We are going to continue to move forward and build our platform and build this model in other jurisdictions, but we are always hopeful something meaningful will happen in Washington” – Planet 13 Co-CEO Robert Groesbeck
Watch the full interview to learn about Planet 13’s expansion strategies, the current state of cannabis tourism, and what has caused weed stocks’ share price consolidation for the majority of 2021.
00:00 – Planet 13 Co-CEO Robert Groesbeck
00:43 – Record sales and Orange County Superstore
01:31 – Las Vegas Superstore
02:00 – Las Vegas expansion
02:48 – Items driving gross margins
03:24 – Las Vegas competition
03:55 – Nevada cannabis regulations
04:42 – Federal cannabis regulations
05:35 – Cannabis tourism
07:18 – Does cannabis tourism slow down with more U.S. states coming online?
08:30 – Cannabis share price consolidation