Strong sales is one of the reasons why Alcanna Inc. (TSX:CLIQ) is flying high in the market. The stock has been on an impressive run since the start of the year. A solid second-quarter earnings report underscores underlying growth justifying a higher valuation going forward.
Alcanna Price Analysis
Solid earnings results comes hot on the heels of the company announcing the acquisition of 28 Solo Liquor stores. The acquisition is set to strengthen the company’s business empire expected to be a key driver of the bottom line going forward.
Alcanna is trying to pick itself after a roller coaster 2018 that saw it shed a significant amount of market value. Improved operational efficiencies, as well as sales growth, explains why the stock has continued to trend higher since the start of the year. The stock is already up by more than 30% and showing signs of edging higher in response to positive earnings results.
Q2 Earnings Boost
For the three months ended June 30, Alcanna achieved a 20.9% increase in sales that came in at $200, 264. Same-store sales was also up by 8.2% in the company’s core Canadian liquor retail business, marking the third consecutive quarter of market share gains.
“Our growth in both total sales and same-store sales reflects the successful execution of our strategy to grow market share both for our existing stores and trade areas as well as invest in new markets,” explained CEO, James Burns.
During the quarter, Alcanna achieved significant milestones key among them being the acquisition of underling assets belonging to 28 Solo Liquor Stores. The company also opened two new stores in Lethbridge and St. Albert Alberta as part of an ongoing expansion drive. The company is averaging $450,000 in sales per week following the opening of a Nova Cannabis retail store On Queen Street West in Toronto. Plans are already underway to open 20 similar stores by the end of the year.
According to the Chief Executive Officer, Alcanna financial position remains strong, ideal for supporting the underlying growth strategy.