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American Diversified Holdings Corp (OTCMKTS:ADHC) Looking To Be A Cannabis Industry Player

American Diversified Holdings Corp (OTCMKTS:ADHC) Looking To Be A Cannabis Industry Player
Written by
Jarrod Wesson
Published on
November 9, 2017
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Today, we are going to talk again about American Diversified Holdings Corp (OTCMKTS:ADHC), which has delivered very interesting returns in 2017.Our readers will remember well that the company was featured in Insider Financial as a must-follow. We were not wrong in saying so.Since our last article, the share price has gone from $0.0012 to $0.0029. This means that our readers could have made triple digit returns by following our recommendation.

1 year chart for ADHCBut, that's not the most significant. What we appreciate the most is that the amount of shares that changed hands increased as well. Thus, we believe that the market interest in the stock increased quite a bit. More than 50 million shares changed hands some days. Have a look at it in the following chart: 1 month chart for ADHCBefore we go with the recent news that caused this spike, let's provide some background. The company provides services to other micro-cap public companies that have proven revenues and business models. The list of services include "executive management, corporate governance, administrative support, financial advice, and introductions to capital sources."We commenced to cover the company because of the expertise of the management. The company is said to have forty years of business experience helping other companies develop their business. We believe that this is key to understand the success of this company. It is not only that it owns a business network for companies that are starting, but also that the know-how accumulated should be appreciated by clients.Recent DevelopmentsA lot of valuable information has been released to the market in September and October.On September 28, 2017, the company released its annual report for the year ended July 31, 2017. It was a good read. It contains the financial situation of ADHC. Additionally, another document called Management Discussion and Analysis was also released the same day, wherein we could find out that the company has been returning shares to the treasury. We appreciate this fact, as it increases the intrinsic value of the stock:
  • On October 16, 2016, the Company returned 160,000,030 shares of Common stock to Treasury.
Additionally, we need to highlight that the amount of shares issued in 2017 were less significant:
  • On February 17, 2017, the company issued a total of 55,000,000 shares of common stock for consulting and services rendered to the corporation.
  • On March 23, 2017, the company issued a total of 10,000,000 shares of common stock for consulting and services rendered to the corporation.
  • For the quarter ended July 31, 2017, the company made no issuances of shares of stock of any class.
Furthermore, on October 2, 2017, the good news continued. The market received an attorney letter, wherein it was noted that the information given by the company was "adequate current public information concerning the Securities and the Issuer and is available within the meaning of Rule 144(c)(2) under the Securities Act."We believe that many more market participants will be interested in this company after the release of this letter to the market. We appreciate the initiative.What caused the recent spike?The share price spike seen in November was created by this press release, which was received on November 2, 2017. The company announced a new initiative with Hemp Plus and Cannabis delivery systems. In our opinion, the fact that the company may be entering the cannabis industry is what made the market quite excited.If you are not aware of the marijuana business opportunities, listen to this. After the legalization of some forms of medical marijuana in some states in the US and Canada, the demand for cannabis exploded up. Market participants reacted by pushing up the share price of marijuana stocks. The returns so far have been extraordinary.ADHC seems to be making a clever business decision at the right time. We encourage readers to read some of our articles on cannabis to get to know what can happen to the stock after this decision. What's the business plan of ADHC?Little was received by the market so far, thus we will be expecting soon information about the new business model. Be alert, as this new information can make the share price spike.What we know is that ADHC will create "CBD products, Cannabis delivery systems, and accessories."Like everybody else, no?No, the company noted that the health standards will be higher than those in the marijuana industry:
"ADHC will focus on setting the bar above current standards in the industry related to safety and health. This array of premium quality Cannabis delivery systems provide a new perspective to traditional marijuana products." Source
The company added that it will be focusing on vaporizer delivery systems to perform that task.ConclusionCurrently trading with a market cap of $2 million, ADHC is an exciting story among small caps. We believe that if the company is able to receive financing for the new projects, the company could grow substantially. The reaction of the market to the recent news was satisfactory, thus we don't believe that financing will be a problem.To sum up, the company seems to be creating new business opportunities in the marijuana industry that could deliver significant corporate growth. All of this has certainly put ADHC on our radar screen.Be sure to check out our coverage on ADHC!We will be updating our subscribers as soon as we know more. For the latest updates on ADHC, sign up below!Image courtesy of Greg Pellegrini via FlickrDisclosure: We have no position in ADHC and have not been compensated for this article.

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