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GrowGeneration (GRWG) Enters Mushroom Industry With GrowLife Deal
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GrowGeneration Corp. (GRWG - Free Report) announced a multi-year partnership with GrowLife, Inc. (PHOT - Free Report) . The deal will position both companies as early adopters in the rapidly increasing mushroom farming industry by focusing on the development and selling of mycology supplies.
GrowLife, in sync with its focus on investing and operating businesses in the promising mushroom industry, acquired Bridgetown Mushrooms in January 2023. According to the terms of the agreement between GrowLife and GRWG, the latter will be the sole distributor of Bridgetown's mycology products. The industry-leading products include Bridgetown's patented mix of commercial substrates, soils and nutrients created over the last ten years.
The collaboration will give mushroom farmers a suitable medium for optimizing mushroom production. With demand for mycology products on the rise, this partnership is likely to create considerable revenue growth and market share for both companies.
The alliance will initially focus on the Pacific Northwest and other Western states. The companies aim to rapidly boost capacity and expand nationwide, leveraging GrowGeneration's seasoned commercial sales team and its more than 60 retail locations around the country.
GrowGeneration expects revenues between $250 million and $270 million for 2023. Full-year adjusted EBITDA is expected between negative $4 million and positive $1 million.
In the first quarter of 2023, GRWG reported a loss per share of 10 cents, narrower than the Zacks Consensus Estimate of a loss of 11 cents per share. The company had reported a loss per share of 9 cents in the first quarter of 2022.
GrowGeneration generated revenues of $56.8 million in the March-end quarter, which declined 30.5% year over year. The results reflected the ongoing weakness in the cannabis industry. The top line surpassed the Zacks Consensus Estimate of $55.9 million. Comparable store sales in the quarter slumped 36.6% from the prior year at its 55 retail locations and e-commerce operations.
Price Performance
In the past year, GRWG’s shares have lost 34.8% compared to the industry’s fall of 19.9%.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
GrowGeneration currently has a Zacks Rank #3 (Hold).
The Zacks Consensus Estimate for Gold Fields’ fiscal 2023 earnings per share is pegged at $1.01. Earnings estimates have moved 6.3% north in the past 60 days. GFI has a trailing four-quarter earnings surprise of 7.7%, on average. Its shares have gained 46.2% in the past year.
The Zacks Consensus Estimate for Alamos Gold’s earnings per share is pegged at 47 cents for 2023. Earnings estimates have been revised 14.6% upward in the past 60 days. AGI has gained 91.4% in a year.
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GrowGeneration (GRWG) Enters Mushroom Industry With GrowLife Deal
GrowGeneration Corp. (GRWG - Free Report) announced a multi-year partnership with GrowLife, Inc. (PHOT - Free Report) . The deal will position both companies as early adopters in the rapidly increasing mushroom farming industry by focusing on the development and selling of mycology supplies.
GrowLife, in sync with its focus on investing and operating businesses in the promising mushroom industry, acquired Bridgetown Mushrooms in January 2023. According to the terms of the agreement between GrowLife and GRWG, the latter will be the sole distributor of Bridgetown's mycology products. The industry-leading products include Bridgetown's patented mix of commercial substrates, soils and nutrients created over the last ten years.
The collaboration will give mushroom farmers a suitable medium for optimizing mushroom production. With demand for mycology products on the rise, this partnership is likely to create considerable revenue growth and market share for both companies.
The alliance will initially focus on the Pacific Northwest and other Western states. The companies aim to rapidly boost capacity and expand nationwide, leveraging GrowGeneration's seasoned commercial sales team and its more than 60 retail locations around the country.
GrowGeneration expects revenues between $250 million and $270 million for 2023. Full-year adjusted EBITDA is expected between negative $4 million and positive $1 million.
In the first quarter of 2023, GRWG reported a loss per share of 10 cents, narrower than the Zacks Consensus Estimate of a loss of 11 cents per share. The company had reported a loss per share of 9 cents in the first quarter of 2022.
GrowGeneration generated revenues of $56.8 million in the March-end quarter, which declined 30.5% year over year. The results reflected the ongoing weakness in the cannabis industry. The top line surpassed the Zacks Consensus Estimate of $55.9 million. Comparable store sales in the quarter slumped 36.6% from the prior year at its 55 retail locations and e-commerce operations.
Price Performance
In the past year, GRWG’s shares have lost 34.8% compared to the industry’s fall of 19.9%.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
GrowGeneration currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are Gold Fields Limited (GFI - Free Report) , and Alamos Gold Inc. (AGI - Free Report) . GFI currently flaunts a Zacks Rank #1 (Strong Buy) and AGI has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Gold Fields’ fiscal 2023 earnings per share is pegged at $1.01. Earnings estimates have moved 6.3% north in the past 60 days. GFI has a trailing four-quarter earnings surprise of 7.7%, on average. Its shares have gained 46.2% in the past year.
The Zacks Consensus Estimate for Alamos Gold’s earnings per share is pegged at 47 cents for 2023. Earnings estimates have been revised 14.6% upward in the past 60 days. AGI has gained 91.4% in a year.