The management at Matica Enterprises Inc (CNSX:MMJ) must have been very pleased to report their financial performance for the recent half year.To put it into perspective, the above-mentioned information acted as a catalyst to the firm’s share price, propelling it to a 34% surge in its price over a five-day period. The firm’s stellar performance follows closely the example of most companies operating within the high risk and high return area of marijuana, bringing to a new high months and months of exemplary financial performances announced by these companies to the market.It is as a result of this performance that the following price surge was experienced: DE Daily ChartReaders would be keen to notice that over the above period, there was one period of surge in the traded volumes – 20th of August – which was the day when the financial information was released. This, in turn, speaks to the market’s eagerness to follow the happenings of Matica Enterprises and its reactive capacity given the positive news arising from it. Above all, all the above alludes to better financial management by the managers of the company as well as the company’s value proposition, all which we will discuss over the course of this piece.MMJ: A bit of the HistoryMatica Enterprises Inc was founded back in 2007 and headquartered in Toronto, Canada. Back then, the company was known as Matica Graphite Inc; an entity which held interests in two key projects: Grumpy Lizard project in Nevada and Buckingham North property in Ottawa. However, in 2014, there was a strategic drift, leading the entity to change its operations and venture into the healthcare sector.The company currently operates within the biotechnology industry with an incline to the healthcare sector. Here, their business is primarily centered on medical marijuana. They are defined as a late-stage AMPCR applicant engaging in the production and distribution of marijuana across Canada.Given especially that the Canadian market is in its growth phase especially with the federal legalization of marijuana, it seems that the odds are in its favor and that the only way for the MMJ stock to go from now is up.Recent DevelopmentsThere have been a number of events which have been experienced by MMJ over the recent past. Most of these events have generally had a positive impact on their operations or the market’s outlook towards the firm. In our analysis, we opted to bring readers up to speed with the latter by plotting the company’s path over the past few months.Entry into Horizon ETFThe positive journey for MMJ begun a while back, however, it was two months back that it culminated in their success in the market. During this period, the company was able to achieve a status many in its ranks only dream to achieve.Over this period, the company was able to rise up the ranks and obtain a seat in the Horizons Emerging Marijuana Growers Index ETF (HMJR). This fund provides investors with a feel of the emerging stocks operating within the cannabis industry in Canada, allowing them to participate in a more balanced portfolio in the process. It comprises of a basket of small-cap companies which are publicly listed within North America and which operate either in cultivation, production and/or distribution of marijuana.Whilst about five companies were eliminated from the index – as a result of not qualifying anymore – MMJ was among the companies which exuded the capacity to join the fund, presenting investors with a positive outlook to itself.A positive outlook is gold to any business. Investor beliefs are shaped by the above and if the company’s outlook is in line with the above beliefs, investors will most certainly invest in that company.Stellar Financial PerformanceIt wasn’t long after this that the company solidified its position in the market by announcing the amazing news to their investors.In their most recent announcement, the market obtained that over the period between December 2017 and June 2018, the firm’s cash position, marketable securities, and working capital position had risen to $6,47 million, $2.1 million and $9.06 million in June 2018 up from $2.66 million, $1.05 million and $4.39 million in December 2017 respectively.In explaining the above figured, the CFO was quick to point out that the company’s working capital was enough to cater to the over $10 million needed to construct the 200,000 square-foot greenhouse, invest in Yunify which he described as ‘a line of credit secured by a mortgage being extended to purchase and develop the 181-acre agricultural property’ as well as serve their operational needs for the year.Source:Furthermore, the company’s investment of $ $695,000 into the THC Dispensaries Canada Inc had risen in value to $2.1 million by June 2018 and was expected to rise to $2.65 million by the end of the year.Through this, the market was able to ascertain that MMJ was in the money. Given that it doesn’t need to borrow or seek additional financing to meet its needs, the current investors seem pleased and have shown this through the share price performance.ConclusionIt seems that MMJ is the stock to beat. Their financial performance coupled with the outlook they have given investors is bound to lead them to the top. As a result, we remain bullish about the stock both in the short and long term.We will be updating our subscribers as soon as we know more. For the latest updates on MMJ, sign up below!Disclosure: We have no position in MMJ and have not been compensated for this article.
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