We've been hinting that today's report is a different type of animal and we are happy to say the time has come to unveil our findings. Does a company jumping from virtually zero sales to $1M in sales interest you?
Thursday's number one play to watch is SRNA - Surna Inc.
Everyone knows marijuana was the hottest sector on the OTC last year. It seemed like every company that mentioned the word instantly shot up 100%. One year later, the picture is quite different. Out of the 100+ "marijuana plays" we saw, it seems only a small percent are actually still around. Many have been halted by the SEC, some have been diluted into oblivion, and some just weren't involved with marijuana at all to begin with.
SRNA is a newer "cannabis play" and while it was around one year ago, the company was just dipping its toes into the sector when the market was at its hottest. It did go a nice 500% run with all the hype back then, but has since settled down, and is now trading very organically! Even better, the volume is much higher.
Around March of last year, SRNA sold off their old business model and devoted 100% of their resources to a great niche of the cannabis market. The company says their "merger with Safari and acquisition of Hydro" is the where the story actually begins.
In the company's Q1'14 report, $0 in sales were reported. As soon as SRNA got involved in the cannabis industry, sales shot through the roof.
In the company's Q2'14 report, $347K in sales were reported.
In the company's Q3'14 report, $850K in sales were reported!
SRNA had over $1.2M in revenue in just the first three quarters of 2014. What's even bigger is that the Q4 numbers aren’t even out yet!
These types of material changes in how a company does business is exactly what catches our eye. To generate revenues, SRNA now provides climate equipment, integrated solutions, and installation service designed for the indoor cannabis gardening industry through construction-type contracts.
SRNA is attempting to capture the commercial side of the market with innovations in cooling technology and products that reduce electricity costs for large growing operations.
The most active subsidiary SRNA owns appears to be Hydro Innovations. On Hydro's website, you can view all of their products and even order them online. Water cooling doesn't stop at computers or cars, Hydro is selling water chilled climate control systems that claim to reduce operator costs by 30%.
The fact that SRNA is catering to industrial, at-scale operations gets us excited. We see two, four, even ten ton air coolers; there are dehumidifiers and air flow control systems. Large scale growers must be starting to catch on because new contracts have been announced as recent as this year.
In January of this year, SRNA signed a huge contract!
Surna, Inc. Secures $1.1M Tech Contract
with Indoor Cannabis Grower CWNevada
Jan. 13, 2015 - BOULDER, Colo. - Surna Inc. (SRNA), an engineering, manufacturing, and installation Company specializing in commercial indoor cannabis cultivation technology, announced today it has finalized an exclusive $1.1M contract to design, build and install the climate control systems for grower CWNevada.
CWNevada is one of the largest indoor cannabis cultivation facilities in Las Vegas, and was recently granted a Nevada grow license as the state prepares its infrastructure for the growth and distribution of legal medical marijuana in 2015. The Company's 48,000 square-foot facility requires more than 700 tons of cooling equipment. Surna will provide CWNevada with their proprietary climate control technology which lends greater latitude and precision to the cultivation process while improving energy efficiency.
Read the full press release here. SRNA reports their revenues using the "percentage-of-completion method", so we are not 100% sure how much of this has been realized yet, if any. We are eagerly awaiting a progress report on this project.
An important thing to remember is that SRNA isn't operated by your run-of-the-mill management crew either. Let us brief you on their CEO, Tom Bollich. In 2007 he co-founded Zynga, the online gaming company. Zynga created games such as FarmVille and Words with Friends. While at Zynga, Bollich served as a Studio Head and CTO.
We want all readers to keep an eye on SRNA as the fundamentals really stand out (to us) compared to many other cannabis plays out there. SRNA went from $0 in sales to $1.2M in 9 months, and Q4'14 quarter revenues are expected to hit any day.
If Q4 was equal to Q3 - annual sales would be over $2M! How many other cannabis plays are showing these types of numbers this late in the game (when it counts most)?
Continue your research and pull up SRNA Level 2 right now!
We will be sending new pieces of info later in the day, including a quote from the CEO's TV appearance.
