New buy: MILC

I talked about a new buy a few days ago. The purchase was of Millennium Sustainable Ventures (MILC).

I’ve followed MILC since 2011 when it was selling for less than cash + investments. I was intrigued by the valuation but never really felt attracted to the operational team. The stock then went on a huge run, from 40 cents to $11.

The company’s stock came back to earth with the operational problems they had and also the Michigan license issue. Recently the company put out a 8-k where it became clear that the Michigan license issue seems to have been resolved. In the next couple of months the company should get its Michigan license.

The Michigan license will be a huge revaluation of the company. The play for me is to play the re-rate from getting the license. The problem I see is not with MILC but that in the cannabis sector there are some amazingly well run companies with huge moats selling at a cheap valuation. So it is much better to buy the higher quality companies then go for something that has lot of execution risks.

Anyways, at less than $1 it was a really cheap given the Michigan license issue seems to be resolved.

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