Planet 13 Holdings Inc: World’s Largest Pot Dispensary Poised for Record Q3

Planet 13 Holdings IncPlanet 13 Holdings Inc up 453% Since March Lows

Planet 13 Holdings Inc (OTCMKTS:PLNHF, CNSX:PLTH) remains one of the best U.S. pot stocks going. Planet 13 stock is up 75.2% year-over-year, 72% year-to-date, and a whopping 453% since hitting March lows.

With Planet 13 Holdings Inc being owner of the world’s largest cannabis dispensary, PLNHF stock has been on a great trajectory for a number of reasons.

First, the entire cannabis industry has experienced a renaissance. In addition, the company continues to grow its market share in Nevada, reporting strong first-quarter results.

As expected, Planet 13’s second-quarter results were not stunning. Not a surprise, since Nevada was shut down as a result of the coronavirus, as was most of the country. Still, because Nevada, along with 10 other states where adult-use marijuana is legal, declared cannabis dispensaries “essential,” Planet 13 fared better than others during the shutdown.

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On the plus side, Las Vegas is up and running again and the company’s business is booming. In fact, Planet 13 Holdings Inc rang in record revenue in July and August.

The company’s own products are now available in 33 dispensaries in Nevada, plus it will soon be reopening its Medizin dispensary in Las Vegas.

Most exciting perhaps, Planet 13 will be opening a new dispensary in Santa Ana, California in 2021. It will be the world’s second largest dispensary.

Chart courtesy of StockCharts.com

PLNHF Stock Overview

Planet 13 Holdings owns and operates the largest pot dispensary in the world. It also holds six licenses for the Nevada market and, as mentioned above, is slated to open the world’s second largest dispensary in California next year. (Source: “Corporate Presentation, June 2020,” Planet 13 Holdings Inc, last accessed August 2, 2020.)

Planet 13’s Las Vegas SuperStore, located just off the Las Vegas Strip, covers an eye-watering 112,000 square feet; that’s the size of two football fields or the size of the average Walmart store.

Here, you can buy the company’s growing portfolio of branded products, including vapes, edibles, pre-rolls, and concentrates.

If you like pot, chances are you’re familiar with the company’s products: “TRENDI,” “Dreamland” (chocolates), “HAHA” (infused gummies), “Leaf & Vine,” and “Planet M” premium CBD products.

More than just a pot dispensary, visitors can also find anything and everything else they need to enjoy a quiet afternoon. Those tired of shopping can take a break and enjoy a drink or snack at the coffee shop, bistro, or pizzeria.

And people seem to love Planet 13. The company’s Las Vegas SuperStore accounts for more than 10% of all retail cannabis sales in the state.

As noted before, Planet 13 is expanding its operations outside of Nevada. In May, it said a second cannabis SuperStore would open in Santa Ana, California.

Because of COVID-19, the company initially wouldn’t provide a date as to when it would be opening. An exact date hasn’t been nailed down, but it now appears that 2021 is when the world’s second largest marijuana dispensary will be opening.

More are on the way, too. Over the next five years, Planet 13 is hoping to cut the ribbon on at least eight new SuperStores in North America. Potential locations include Seattle, San Francisco, Chicago, New York City, Miami, Toronto, and Vancouver.

Q2 Results Take Hit, But Q3 on Record Pace

On August 31, Planet 13 Holdings Inc announced that revenue for the second quarter ended June 30 slipped approximately 35% year-over-year to $10.8 million. (Source: “Planet 13 Announces Second Quarter 2020 Financial Results,” Planet 13 Holdings Inc, August 31, 2020.)

The company reported a net loss of $4.0 million, or $0.03 per share, compared to a second-quarter 2019 net loss of $0.09 million, or $0.01 per share.

Adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) was a loss of $0.07 million, compared to adjusted EBITDA of $2.7 million in the same prior-year period.

Planet 13 finished out the second quarter with cash totalling $22.7 million, compared to $12.8 million at the end of the second quarter of 2019.

Total assets were $81.9 million, compared to $62.9 million. And total liabilities were $30.9 million, versus $21.6 million in the same period last year.

Larry Scheffler, co-CEO of Planet 13 Holdings Inc, commented, “As the State has reopened, we’ve seen an incredible pickup in our business, with July and August being our highest months of sales to date. The SuperStore is seeing increased customer conversion and higher tickets, while our delivery team is servicing local customers and providing approximately 15% of our sales compared to less than 1% pre-COVID.”

Bob Groesbeck, co-CEO added, “In July and August we’ve generated our highest revenue ever, over $7 million per month. We are set to build on this momentum reopening our Medizin dispensary shortly and Santa Ana in 2021. I’m incredibly excited about what the future holds for Planet 13.” (Ibid.)

Analyst Take

After a tough second quarter, which was hampered by the coronavirus, Planet 13 Holdings has resumed its upward trajectory.

Investors weren’t even phased by the underwhelming second-quarter results, as is evidenced by the fact that its share price didn’t move much. If anything, investors are excited for the third quarter.

Management already announced that it generated its highest revenue in July and August. Further out, Planet 13 is also opening its Santa Ana SuperStore in 2021, which bodes well for investors in the coming quarters.