On Mad Money's "Executive Decision" segment Tuesday night, Jim Cramer talked with Peter Horvath, CEO of Green Growth Brands (GGBXF) . Eight months ago the company had one shop. Now it has 60 and it's on track to have 240 in the next four months, Horvath explained.
The growth in the industry is incredible, and for Green Growth Brands, it wouldn't work without some help. The company has partnerships with Simon Property Group (SPG) and Brookfield Asset Management (BAM) . These two companies operate some of the best malls in the world, giving Green Growth Brands access to some of the best locations right away.
Green Growth Brands has been bringing in excellent retail operators who have a knack for store layouts and understand the customer. That's helped to drive sales with locals rather than relying on tourists, as well as increasing the store's sales per square foot. Horvath told viewers that the company sells topical CBD products, which is federally legal in the U.S. However, edibles and inhalants are not yet legal under federal law.
Don't inhale but let's take a quick look at the charts.
In this daily bar chart of GGBXF, below, we can see a couple of big percentage swings - from $2.50 to $5.00 and back to $2.00. After an initial two-month rally to a January high (no pun intended) we see prices in a downtrend and below the declining 50-day moving average line.
The On-Balance-Volume (OBV) is in a decline too and suggests that sellers have been more aggressive the past five months.
In the lower panel the 12-day price momentum study shows a rising pattern from May which is a bullish divergence when compared to the declining price pattern. This divergence says that the pace of the decline has slowed. This can sometimes foreshadow a rally in price.
In this Japanese Candlestick chart of GGBXF, below, we can see many red candles which tells us that the bear has been in control as prices have closed below the opening. A spinning top and confirmation at the end of June looks like it has marked a low for now.
In this limited Point and Figure chart of GGBXF, below, we can see that a rally to $2.75 is needed to move to a column of "X's".
Bottom line strategy: I would consider GGBXF highly speculative as we have little price history and only for experienced traders who can exercise discipline. Probe the long side only if you are absolutely prepared to get out on a close below $1.99. Small risk and uncertain reward.
