#Update

Yesterday, we reported a major milestone and probably the most significant news in Supreme Pharmaceuticals’ (FIRE.V) (SPRWF) history.

Although we were favorable on this news, we were cautious with the shares due to its market cap being larger than a few of its peers, which are more advanced and larger than Supreme.

Our cautious approach proved to be correct and Supreme dropped almost 11% yesterday on strong volume. At the opening bell, Supreme was more than twice the size of Emblem Corp. (EMC.V) (EMMBF) and larger than Organigram Holdings (OGI.V) (OGRMF) and Cronos Group (MJN.V).

At current levels, Supreme’s market cap still trumps Emblem, Organigram, and Cronos. We continue to prefer these firms to Supreme and will monitor how the market responds to yesterday’s weakness.

We are now watching Supreme closely and will provide updates as this story develops.

Better late than never…

This phrase can be applied to Supreme Pharmaceuticals (FIRE.V) (SPRWF) after its wholly-owned subsidiary, 7ACRES was granted permission to sell medical marijuana under the ACMPR.

Supreme is a publicly traded Canadian cannabis company focused on becoming a leading cannabis cultivator and distributor through 7ACRES, a licensed medical cannabis producer that operates inside a 342,000-sq. ft. hybrid greenhouse facility in Kincardine, Ontario.

A Long-Time Coming

In March 2016, Health Canada issued 7 Acres its cultivation license and the 16-month gap was by far the largest wait time for any ACMPR licensed producer.

Although the amount of time between license approvals was strenuous, it was not without cause and was not because of Health Canada.

First, 7 Acres cultivates from a seed which takes longer than a clone and adds several weeks to the grow process. And Second, the process was delayed when a nutrient the company uses was involved in a regulatory inquiry earlier this year.

Supreme is Now Larger than Cronos, Emblem, and Organigram

Is the news already priced into shares of Supreme or is there still upside to current levels?

We are cautious with Supreme at current levels as its market cap is north of $250 million. At these levels, Supreme is more than twice the size of Emblem Corp. (EMC.V) (EMMBF) and it is larger than Organigram Holdings (OGI.V) (OGRMF) and Cronos Group (MJN.V).

Although we are favorable on Supreme, we continue to prefer Organigram, Emblem, and Cronos.

Organigram was one of the first publicly traded licensed producers and its valuation is very attractive after a 23% pullback this year. Emblem is the most undervalued licensed producer and is an attractive play on the cannabis and biotech-cannabis markets. Cronos on the other hand offers investors leverage to a firm with a proven track record of success as well as an expanding global footprint.

Is the News Priced in or How High Can Shares Go?

Yesterday’s license grant was significant and we will monitor how the market responds to this today. Supreme received a favorable response from the market after this news was announced and the shares jumped almost 9% higher (shares were down when it was reported).

We will monitor how Supreme trades today and Technical420 Premium Members will receive an updated research report covering this development.

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