Mentor Capital Inc (OTCMKTS:MNTR) Just Made Itself More Attractive

Mentor Capital Inc (OTCMKTS:MNTR) was a runner at the end of last week, with the company having announced its latest share purchase pre market on Friday March 3. The announcement brings with it an exposure to one of the leading players in the cannabis space right now (and indeed, for the last few years) and – in our eyes – offers insight into the kind of company's Mentor is looking to fund.With that said, the acquisition in question is sort of outside the company's standard remit, which might be explained one of two ways – either Mentor is altering its target criteria, or it's a one off deviation. Neither of these two explanations are particularly damaging to the company's attractiveness as an allocation for an individual investor.Anyway, whatever the situation, here's a look at the latest buy, and what it means going forward for Mentor and and its shareholders.For those new to Mentor, the company describes itself as an entity in place to offer development and growth capital to privately held, small cannabis companies. Simply put, shareholders take a position in Mentor, and Mentor uses the shareholder capital to invest in private cannabis companies. These are generally (as we'll discuss in a second, the latest buy bucks this rule) companies that public market players wouldn’t normally be able to gain exposure to, and, on the other side of the equation, this is capital that the small private companies wouldn’t normally be able to attract. The company likes to point out that it's not an investment firm, but for all intents and purposes, and from an operational perspective, at least, it is.The latest buy, then, is a $1 million position in a company called GW Pharmaceuticals PLC. Yes, this is the GW Pharmaceuticals that used to trade on the LSE but delisted (voluntarily) at the end of last year. It trades on the NASDAQ via ADR under ticker NASDAQ:GWPH, and it's far from a small player – it held a market cap (based on the just mentioned ADR price) of $2.8 billion at last count. Mentor's $1 million position misses considerably on the 10-60% stake it normally takes in its portfolio companies, again serving to widen the digression from its standard MO.So what’s the deal with the play?Well, we think this is the second of our above mentioned scenarios – the company is deviating from its usual strategy as a one off – and that it is a positive from an evaluation perspective. Why? Because GW is a very good buy right now. It has been for the last twelve months. For those not familiar with GW, it's a pharmaceutical cannabis player, and it's lead assets are cannabidiol based MS and epilepsy medications. It's successfully brought drugs through the FDA approval process, is very well capitalized ($360 million cash on hand at end 2016) and is well positioned to take advantage of a number of rare disease markets near term. It's insulated from any of the political back and forth over recreational cannabis in the US (by way of its medical focus and UK HQ) and it's topped the watch lists of many cannabis investors for a number of years. For a long time, and we're talking 2012-2015 here, it was one of the only, if not the only, credible cannabis play. In a market saturated by risky penny plays and outrageous valuations, it's a standout. It's trading just off annual highs, ahead of a number of major catalysts related to its epilepsy efforts, and has analyst forecasts of an average 30% appreciation throughout 2017.Sure, it's not Mentor's usual pick-type, but it's now the company's largest exposure (in terms of proportion of portfolio) and for us, this gives the company a solid base of strength from which to allocate to what might be deemed the more risky smaller entities that fall within its MO.This is still a risky allocation, of course. Insiders are selling shares and there's not much clarity on offer as far as some of the company's already held portfolio.That said, think of the GW position as the risk mitigating play in a balanced portfolio. This move de-risks the stock somewhat, and as such, is a value driver in our eyes.We will be updating our subscribers as soon as we know more. For the latest updates on MNTR, sign up below!Disclosure: We have no position in any of the securities mentioned and have not been compensated for this article.