SHWZ - Schwazze (SHWZ) - Laying the Groundwork Solid First Quarter

1Q21 Results. Revenue totaled $19.3 million, up from $3.2 million last year, driven by the acquisitions. Pro forma revenue was estimated at $26.8 million. Adjusted EBITDA for the quarter was $5.8 million. Schwazze recorded a net loss of $3.6 million, or $0.09 per share compared to a loss of $1.4 million, or $0.03 per share, last year. Schwazze also reported positive CFFO of $1.7 million, up from a loss of $2.5 million last year.Operating Metrics Improving. Same store sales of the thirteen Star Buds dispensaries when compared to last year, prior to taking ownership of the assets, were $18.8M up 38%. Average basket size was $58.79, up 19.5%, and recorded customer visits were 319,800, up 15.8%. GM increased to 37.5% from 32.9% last year and was 48.9% after adjusting for a one-time purchase accounting charge.Still on the Prowl. Management's near-term goal remains to double the projected 2021 revenue run rate. This will be accomplished through a combination of organic growth driven by implementation of the Company's operating system, and inorganic growth through acquisitions. Management remains focused on the Colorado market but we expect expansion into additional states in the future.Updated Guidance. Management raised the low end of its 2021 revenue and adjusted EBITDA guidance, with the new ranges $110-$125 million and $30-$36 million respectively. The second quarter will be the first full quarter with all acquisitions under the roof. We are projecting revenue of $30.1 million and EPS of $0.02 for the quarter. For the full year, we are at revenue of $116.7 million, adjusted EBITDA of $34 million, and EPS of $0.06.Maintaining Outperform. We are maintaining our Outperform rating and $4.00 twelve month price target. At our price target, SHWZ shares would trade at 4x projected 2021 revenue and 13.8x projected 2021 EBITDA on a fully diluted basis. Read More >>