MGC Pharma Boasts Sales Milestone Sending Shares Higher (ASX:MXC)

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Is the pot stock boom back?

That is the question that investors need to be asking themselves right now. As the sector both locally and abroad is seeing some noteworthy movement.

Today, MGC Pharmaceuticals Ltd [ASX:MXC] was busy making their case for the cannabis comeback with the MXC share price climbing on positive news. Noting significant sales growth over a consecutive period.

Granted, this is a company that is working off a tiny base. Both in terms of the volume sales and their key market.

That doesn’t make it any easier to ignore though, at least from an investing perspective…

Booming business

The big news is that MGC’s sales volume is up 65% from 30 June to date. With over 7,000 units of their cannabis-based medicine sold in the period.

Plus, in the past four weeks they’ve raked in over $225,000 worth of revenue. With each week beating the one before it. A strong sign of the momentum behind their booming sales.

And with strong demand from both Australia and Brazil, future sales are looking pretty damn good too. Not that MGC can afford to start taking things lightly just yet.

As CEO Roby Zomer notes:

It is increasingly brought to our attention that one of the major inhibiting factors for patient access to medicinal cannabis in Australia, and globally, is the high price point that comes with high-quality medications that are not covered by insurance.

We are constantly streamlining our operations in order to lower our overall cost base, to ensure we can meet our obligation to increase patient access to affordable, high-quality medicinal cannabis products. We are seeing the results of this strategy through the increase in patient demand and sales volume.

So, in other words, Zomer believes that lower costs may be able to give MGC an advantage. Allowing his company to price their products at a much more tolerable range.

Whatever he’s doing, it certainly seems to be working.

The only question now is, will they be able to sustain this growth?

Budding enterprise

One thing is for sure, cannabis is a hot sector right now.

The possibility of a democratic election win and subsequent decriminalisation of cannabis is a real possibility. With Kamala Harris stating that they do plan to push this agenda if her party wins.

For that reason, a lot of speculation surrounding pot stocks is beginning to pick up.

Investors should be taking notice of this fact and keeping it in mind. Because this might truly be the start of another pot stock boom.

Time will tell…


Ryan Clarkson-Ledward,
For Money Morning

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About Ryan Clarkson-Ledward

Ryan Clarkson-Ledward is an Editor at Money Morning.

Ryan holds degrees in both communication and international business. He helps bring Money Morning readers the latest market updates, both locally and abroad. Ryan tackles all the issues investors need to know about that the mainstream media neglects.

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