For his "Executive Decision" segment of Mad Money Wednesday night, Jim Cramer spoke with Michael Degiglio, CEO of Village Farms Int'l (VFF) , the Canadian cannabis grower that just posted earnings that included 27% sales growth.
Degiglio said that Village Farms has 30 years of experience with precision agriculture, which made the transition to cannabis an easy one. The company is already among the lowest cost producers. Degiglio said their plans are to sell their cannabis to companies interested in making CBD-based products, which is among the fastest growing segments in the cannabis space.
Let's check out the charts and indicators to see if they are growing fast too.
In this daily bar chart of VFF, below, we can see a consolidation pattern from last August to January and then prices turned sharply higher with VFF rallying from the $4-$3 area to the $17-$18 area before correcting over several months to the $9 area and the rising 200-day moving average line.
This 50% correction from $18 made VFF attractive to buyers again and the On-Balance-Volume (OBV) line turned higher.
VFF is back above a rising 50-day line and the Moving Average Convergence Divergence (MACD) oscillator has crossed above the zero line for a fresh go long signal.
In this weekly bar chart of VFF, below, we can see that prices are in an uptrend above the rising 40-week moving average line. VFF successfully tested the 40-week line last month.
The weekly OBV line has been improving from April, telling us that buyers of VFF have been more aggressive.
The MACD oscillator is narrowing towards a possible bullish crossover to the upside.
In this Point and Figure chart of VFF, below, we can see an upside price target in the $16 area.
Bottom line strategy: VFF could trade sideways in the $14-$12 area before resuming its uptrend. Aggressive traders could be buyers on dips only if they risk below $10.