The Most Valuable Greenhouse in America Part 2
The Math of How Glass House Can Earn $12+ Per Share in Cash Flow
There is a possibility that Glass House (Canada: GLAS, OTC: GLASF), which currently trades around $4 per share can earn over $12 per share in cash flow when its new state of the art greenhouse is fully up and running and IF (and yes, I know this is a big if) interstate commerce is allowed in the cannabis industry.
Let me caveat the above by saying that interstate commerce is probably a long way off. But as an option, the cash flow numbers are so enormous in an interstate commerce scenario that the upside potential of interstate commerce should be valued at something north of zero. Consider that even if there is a 5% chance of interstate commerce happening, that option alone might be worth $12 per share (20 times $12 per share times 5%).
Even if interstate commerce never happens and if it is only allowed to sell in California, when Glass House gets to scale in its new state of the art greenhouse, it should generate somewhere between $2 and $6 per share in cash flow. This is still a stunning number and would send Glass House up a minimum of 7 times and possibly more than 20 times from its current share price and mind you this is not the interstate commerce scenario, where it would possibly go up more than 50 times.
Let me just state in advance that I know how ridiculous the above sounds and reads. It is even more ridiculous after I have written before about Glass House and their opportunity only to watch the stock plunge 60% from the time of my first recommendation. So, caveat emptor to anything I write on Glass House. In the short run I have been very wrong.
Even being wrong, I feel confident that at current prices Glass House sells for my rough estimate of real estate value and provides one of the best asymmetric opportunities with little downside.
Want to read more and analyze my numbers and analysis? My big 14 page deep dive research report is right here just waiting for you to dig in. I wrote it mainly because there is no good research on Glass House and to my knowledge, no one has run any analysis of the economics of their greenhouse. And the numbers are eye-opening.
After reading my report, I encourage you to run your own estimates, and then I would love to hear your feedback, critiques and thoughts. And remember as always to do your own due diligence. I hope you enjoy it.