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Sugarmade Inc (OTCMKTS: SGMD) Runs Off Reversal


Sugarmade Inc (OTCMKTS: SGMD) has been on the rise in recent weeks since reversing off $0.022 lows earlier this month. The stock is getting noticed by Investors that have transformed it into a volume leader.

Sugarmade is already booking significant revenues and is getting noticed as a major supplier to the growing hydroponic cultivation sector.

Sugarmade Inc (OTCMKTS: SGMD) bills itself as one of the largest publicly traded hydroponics supply companies moving into the industrial hemp space, is a product and brand marketing company investing in products and brands with disruptive potential. Sugarmade’s brands include: ZenHydro.com, CarryOutSupplies.com and pending acquisition of AthenaUnited.com. Headquartered in Monrovia, California, a city within Los Angeles county, Sugarmade has various business operations in diverse marketplaces including packaging and paper goods for various industries, agricultural supplies.

Sugarmade has expanded into the European hydroponics supply market with a growing base of orders taken through Amazon UK. Over the past few financial quarters, Sugarmade has seen revenue growth patterns expand geographically. As recently as mid-2017, the majority of hydroponic-related revenue growth was seen from California and other West Coast marketplaces, however growth is becoming more geographically dispersed among U.S. states where legalization has eased restriction. This movement into the United Kingdom further expands the base of geographic growth areas for Sugarmade.

The Company supplies generic and custom printed products to the quick service restaurant sub-sector of the restaurant industry, via its CarryOutSupplies.com division. While this business unit already serves more than 2,000 quick service restaurants and garners an approximately 25% to 30% market share in frozen yogurt and ice-cream sector, we plan to continue to expand operations via the addition of market share and through the introduction of new product offerings.

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Products include double poly paper cups for cold beverages; disposable clear plastic cold cups, paper coffee cups, yogurt cups, ice cream cups, cup lids, cup sleeves, food containers, soup containers, and plastic spoons. Sugarmade is also a supplier of products to the agricultural sector by way of several recently signed marketing, distribution and business arrangements. This is an exciting market sector with strong growth in a variety of areas. We plan to address many of these growth areas.

in January Sugermade announced its intent to acquire a retail location of Washington State-based Hydro4Less. The operation is expected to produce approximately $5 million in revenues and to be profitable during calendar 2019. Additionally, via the pending transaction, Sugarmade will gain an option to purchase two additional Hydro4Less retail operations, which are currently producing in excess of $20 million annually.

This pending acquisition when combined with pending transactions with BizRight, LLC and Athena United, LLC, both of which also operate in the hydroponic cultivation sector, will place Sugarmade among the ranks of the largest cannabis-related revenue producing companies. Throughout these transactions, Sugarmade will remain only as a supplier to the cannabis industry and will not transact in business where cannabis or cannabis derived products are bought or sold. Under the terms of the pending agreement, Sugarmade will acquire the Washington state flagship location in an all stock transaction pending mutual due diligence, completion of the definitive agreement and approval by both boards of directors.

On May 14 Sugarmade annoucned a new corporate initiative to develop cultivation monitoring systems for hemp and other agricultural commodities. The Artificial Intelligence (AI) driven devices will be placed at various locations within hemp fields to gather vital information about soil moisture, temperature, humidity, etc. and will be data linked back to central control systems.

This monitoring system will allow hemp cultivators to actively monitor conditions in real time. Sugarmade has entered into a joint venture with an engineering group to develop and commercialize the technology.

“Hemp is becoming one of the worlds most valuable crops. Cultivators and investors are actively seeking ways to monitor the health of the crop to ensure maximum yields. This platform, which will be based on AI software from some of the worlds leading technology companies. will not only provide real time tracking of field conditions, but will also make active recommendation to mitigate issues. We have launched this initiative to meet the pressing needs for cultivation monitoring of this valuable agricultural commodity, commented Jimmy Chan, CEO of Sugarmade.

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Currently trading at a $32 million market valuation SGMD has $3 million plus in assets and double that in liabilities. The Company also reported $3,459,511 in sales for the 9 months ended March 31, 2019 up slightly from last year. SGMD is an exciting story developing in small caps; the company is emerging as a major publicly traded hydroponics supplier with several exciting acquisitions pending. We will be updating on SGMD when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with SGMD.

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Disclosure: we hold no position in SMGD either long or short and we have not been compensated for this article.


1 Comment

  1. Nick laterza on

    Sugar made has MORE Liabilities than Assets, that is not too good right now !

    Don’t you think they need to reverse that before us investors will buy in?

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