E Stem Holdings: Getting In On Marijuana's Ground Floor

Last week I found myself with the chance to meet the CEO of a company that sounded like it could meet those criteria: Stem Holdings, Inc. (OTCQB:STMH; CSE:STEM). Stem Holdings was incorporated in mid-2016 and as its basic description "purchases, improves, and leases properties for use in the cannabis production, distribution and sales industry beginning in the state of Oregon." It began trading on the US OTC markets on June 5 of this year, and on the Canadian Securities Exchange on July 16. You can read all the basics in its latest (August) quarterly report and on its very thorough website. In brief, here's how the company describes itself:

Stem has positioned itself as a leader in the U.S. cannabis industry by building state-of-the-art licensed solutions that include: cultivation, processing and retail properties across multiple U.S. markets. As an innovative company, Stem acquires and improves properties for cannabis industry operators and provides turn-key solutions for vetted, marijuana-based businesses including but not limited to edibles, marijuana and hemp cultivation, extraction, and processing. These cannabis companies have developed an extensive portfolio of award-winning consumer-facing brands, partnering with well known, branded cannabis operators with a proven track record of success, such as TJ’s Gardens, Cannavore, Incredibles, Dose-ology and Green T-Farms. 

This being a new and fast-moving industry, Stem Holdings has been busy since the first half ended. In September, with its partners in Oklahoma it acquired multiple medical marijuana licenses; in October, it acquired Yerba Oregon (dba Yerba Buena), an additional Oregon-based craft cannabis brand with a state of the art cultivation facility and advanced genetic strain development. Last month it announced an offering of Special Warrants, the first tranche of which was due to close after Christmas.

Feeling like I had gotten up to speed as much as I could on my own, I sat down with CEO Adam Berk. From their most recent annual meeting filing, this is what I knew about him: "Mr. Berk has been a director, President and Chief Executive Officer of the Company since its inception in June 2016. Mr. Berk’s experience as a founder and principal executive of several start-up companies and skills associated therewith led to the conclusion that he should serve as an executive and director of the Company. From January 2013 until January 2015 Adam was the CEO of HYD For Men, an artisanal men’s grooming company that patented the first solution to extend the life of a razor blade by 400%. HYD For Men is currently sold at HSN, Walgreens, BedBathBeyond, Drugstore. com, Birchbox, GiantEagle, Meijers, and Kinney Drugs. Recently, HYD For Men was acquired by Lucas Investment Group. From January 2015 until January 2017 Adam was the Co-President of Consolidated Ventures of Oregon, a Cannabis holding company. From 2002 through 2013, Mr. Berk was employed with Osmio, Inc. (currently GrubHub, an Aramark subsidiary), the first patented web-based corporate expense management system that concentrated on food ordering for law firms, investment banks and consulting firms. He served as chief executive of Osmio from 2002-2007."

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Disclosure: This article is part of a new “UnderCovered” series of exclusive articles featuring companies with limited coverage. Authors are compensated by TalkMarkets for their time, and ...

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Leslie Miriam 4 months ago Member's comment

$STMH sounds very promising...

Craig Richards 4 months ago Member's comment

This is smart. It's always the solutions providers that always prosper the most. Even when times are tough for the industry, they do even better.

Cannabis Stock Buyer 4 months ago Member's comment

Kate Hayden, $STMH has lost a lot of value since mid 2018. Yet the current #Stem expansion efforts and growth opportunities sound rather promising. Would you say this is a buying opportunity? Or should I wait to see if it goes a bit lower first?

Barry Hochhauser 5 months ago Member's comment

Impressive.

Weed Investor 5 months ago Member's comment

#StemHoldings sounds like a promising opportunity in this burgeoning industry. Definitely going to take a closer look at $STMH

Bill Johnson 5 months ago Member's comment

Sounds promising.

Adam Reynolds 5 months ago Member's comment

Sounds like a promising way to start off the new year!

Wendell Brown 5 months ago Member's comment

It would be great if you could give this treatment to some more companies. I'm interested in microcaps that aren't penny stocks.

Donald Kaplan 5 months ago Member's comment

Good article. The lack of regulation has turned me off from #cryptocurrencies as well. I too think #cannabis investing will be the next hot trend. But unlike the uncertainty surrounding cryptos, it is far more likely to pay off. I will take a closer look at $STMH.

Michele Grant 5 months ago Member's comment

I agree. The future of #crypto is still very uncertain in my book. It's too difficult to know which if any coin will dominate in the future, especially with the lack of regulation. But the general trend seems to be that #cannabis will continue to grow and become legal in more and more locations.