TILT Holdings Needs A Different Type of Rebranding

TILT Holdings [stock_market_widget type="inline" template="generic" color="default" assets="TILT.CN" markup="(CSE: {symbol} {currency_symbol}{price} ({change_pct}))" api="yf"] [stock_market_widget type="inline" template="generic" color="default" assets="TLLTF" markup="(OTC: {symbol} {currency_symbol}{price} ({change_pct}))" api="yf"] is striving for a new image. The Cambridge, Massachusetts-based marijuana and cannabis technology company changed its ticker and optimized its website. Now, users can navigate the company’s website to learn about subsidiaries while remaining aware of the firm’s overall mission.

This comes as the company took a massive impairment hit during the spring and has seen its stock plummet deep into penny-stock territory. Now that the company has rebranded itself from a marketing standpoint, it now needs an image change with investors to ensure its survival.

TILT Holdings Has a New Website, Ticker

This also meant a ticker change in the U.S. On Sept. 10, TILT Holdings began trading in the U.S. OTC markets under the ticker, “TLLTF.” This replaces the previous “SVVTF” ticker, which management did not feel aligned well with its current brand. The change does not require current shareholders to take action.

However, the price action in 2019 may inspire investor activity. TLLTF stock traded as high as $3 per share around the new year. Since that time, it has done little else but fall in value. Today, it has fallen to just under 37 cents per share.

TLLTF Continues to Fall Months After Write-Down

TILT Holdings claimed a valuation of around $500 million at the beginning of the year. However, the company may have suffered irreparable damage in its fourth-quarter earnings report in early May. There, the company announced that it had taken a $500 million impairment charge. In less than a month, that took its valuation down to just $7 million. This led to a total loss of $554.5 million for that quarter on just $5.7 million in sales. The two quarters since that time have shown improvement. However, the call during the second-quarter sparked doubts about company financing.

On Sept. 11, interim CEO Mark Scatterday took the unusual step of releasing a mid-quarter letter to shareholders to quell concerns. One of the issues addressed involved funding. There, he stated that TILT Holdings did not see a “sense of urgency” regarding funding and reiterated the positive adjusted EBITDA and improving cash flows during the last quarter.

However, since that letter, TLLTF stock has lost more than 20% of its value. Given the reaction, management may have to take its “rebranding” further to win back the confidence of investors.

Final Thoughts on TLLTF Stock

Assuming it survives, TILT Holdings would probably like to put 2019 behind it. With the massive Q4 write-down and continuing losses, investors should worry. According to company financial statements, the company lost around $48.9 million in Q2 and almost $78 million in the previous quarter. In the Q2 report, the company released a financial statement showing they only had just over $4.5 million in cash.

This likely makes any investment in Tilt Holdings a bet on survival. Moreover, it will take more than a mid-quarter letter to shareholders to calm such concerns. Yes, management could find the funding, and that would boost TLLTF stock. However, if that does not come soon, the financial statements indicate that TILT Holdings may have to “rebrand” itself in bankruptcy.

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The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

Will Healy
Will Healy is a freelance business and financial writer based in the Dallas area. In addition to marijuana, energy, and mining stocks, he has also written about real estate, insurance, personal finance, and macroeconomics. In addition to Capital 10X, his articles have appeared on sites such as InvestorPlace, Yahoo! Finance, MSN Money, Kiplinger’s Personal Finance, GOBankingRates, and Seeking Alpha. Will holds a B.S. in Journalism from Texas A&M University, an M.S. in Geography from the University of North Texas, and an MBA from the University of Texas at Dallas. Phone: 416-721-8257. Address: 682 Indian Road Toronto, Ontario M6P 2C9.
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