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Hydrofarm Holdings Group, Inc.Hydrofarm Holdings Group, Inc.Hydrofarm Holdings Group, Inc.

Hydrofarm Holdings Group, Inc.

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HYFM trade ideas

HYFM - 3 Waves CompleteBearish slump today has printed an Evening Star candle formation on the 2 day chart. Now with overlapping highs, this can be 3 waves and Phase A complete of an accumulation and from here it can potentially get all the way back to the retracement Golden Window or even make a lower low to form "ST" Secondary Test. There are other possibilities and this could have more overlapping lows and highs to print an ascending wedge to then fall from to a GW retracement. But whichever it is, it does not look bullish here and the opportunity for a great discount is on or perhaps even just to stay out of the way of a dangerous waterfall chart. We'll see how it develops 🤨.
NASDAQ:HYFMShort
by dRends35
THIS LOOKS LIKE A BARGIN ON HYFMHydrofarm Holdings Group, Inc., together with its subsidiaries, engages in the manufacture and distribution of controlled environment agriculture (CEA) equipment and supplies in the United States and Canada. The company offers agricultural lighting devices, indoor climate control equipment, hydroponics and nutrients, and plant additives used to grow, farm, and cultivate cannabis, flowers, fruits, plants, vegetables, grains, and herbs in controlled environment; and distributes CEA equipment and supplies, which include grow light systems; heating, ventilation, and air conditioning systems; humidity and carbon dioxide monitors and controllers; water pumps, heaters, chillers, and filters; nutrient and fertilizer delivery systems; and various growing media made from soil, rock wool or coconut fiber. It also provides hydroponics systems, such as hydro systems, hydro trays and components, meters and solutions, pumps and irrigation systems, water filtration systems, pots and containers, and tents and tarps; atmospheric control equipment comprising controllers, monitors and timers, ventilation/air conditioning equipment, air purification equipment, and CO2 equipment; and nutrients and additives. The company offers its products under the Phantom, PhotoBio, Active Aqua, Active Air, HEAVY 16, House & Garden, Mad Farmer, Roots Organics, Soul, Procision, Grotek, Gaia Green, Innovative Growers Equipment, Quantum, Xtrasun, Digilux, Agrobrite, SunBlaster, Jump Start, Active Eye, Autopilot, Phat, oxyClone, and GROW T brands. Hydrofarm Holdings Group, Inc. was founded in 1977 and is based in Shoemakersville, Pennsylvania. Below Fair Value: HYFM ($1.49) is trading below our estimate of fair value ($4.36) Significantly Below Fair Value: HYFM is trading below fair value by more than 20%. Price-To-Sales vs Peers: HYFM is good value based on its Price-To-Sales Ratio (0.2x) compared to the peer average (0.8x). RISKS Earnings vs Savings Rate: HYFM is forecast to remain unprofitable over the next 3 years. Earnings vs Market: HYFM is forecast to remain unprofitable over the next 3 years. High Growth Earnings: HYFM is forecast to remain unprofitable over the next 3 years. Revenue vs Market: HYFM's revenue is expected to decline over the next 3 years (-1.5% per year). High Growth Revenue: HYFM's revenue is forecast to decline over the next 3 years (-1.5% per year).
NASDAQ:HYFMLong
by Skinwah
HYFM | Oversold Agriculture Play | LongHydrofarm Holdings Group, Inc., together with its subsidiaries, engages in the manufacture and distribution of controlled environment agriculture (CEA) equipment and supplies in the United States and Canada. The company offers agricultural lighting devices, indoor climate control equipment, hydroponics and nutrients, and plant additives used to grow, farm, and cultivate cannabis, flowers, fruits, plants, vegetables, grains, and herbs in controlled environment; and distributes CEA equipment and supplies, which include grow light systems; heating, ventilation, and air conditioning systems; humidity and carbon dioxide monitors and controllers; water pumps, heaters, chillers, and filters; nutrient and fertilizer delivery systems; and various growing media made from soil, rock wool or coconut fiber. It also provides hydroponics systems, such as hydro systems, hydro trays and components, meters and solutions, pumps and irrigation systems, water filtration systems, pots and containers, and tents and tarps; atmospheric control equipment comprising controllers, monitors and timers, ventilation/air conditioning equipment, air purification equipment, and CO2 equipment; and nutrients and additives. The company offers its products under the Phantom, PhotoBio, Active Aqua, Active Air, HEAVY 16, House & Garden, Mad Farmer, Roots Organics, Soul, Procision, Grotek, Gaia Green, Innovative Growers Equipment, Quantum, Xtrasun, Digilux, Agrobrite, SunBlaster, Jump Start, Active Eye, Autopilot, Phat, oxyClone, and GROW!T brands. Hydrofarm Holdings Group, Inc. was founded in 1977 and is based in Shoemakersville, Pennsylvania.
NASDAQ:HYFMLong
by DivergenceSeeker
5
Buying HYFMHydrofarm Holdings Group, Inc. engages in the manufacture and distribution of controlled environment agriculture equipment and supplies. It offers lighting; atmospheric control; hydroponics; nutrients and additives; growing media; plant care and pest and disease control; seed starting and cloning; garden accessories; and food storage products. The firm operates through the US and Canada segments. The company was founded on January 3, 2017 and is headquartered in Petaluma, CA. Check out the sell chart below.
NASDAQ:HYFMShort
by Skinwah
1
When There's A Gold Rush, You Should Be Selling Picks & ShovelsMany of you may have heard this old business maxim before, but if you haven't, it essentially means that the people who made the most money during the gold rushes in centuries' past were the people who sold picks, shovels, and mining equipment to the miners. Sure, every now and again a miner would strike it rich, finding a profitable ore vein or massive nugget of gold, but by and large the people who became prosperous from all the mining were the purveyors of the mining equipment themselves. This may seem counter-intuitive, but the business of selling equipment has a steady demand (return), which is much less volatile than the partially luck-based process of mining for gold, thus allowing the equipment sellers the ability to slowly compound their businesses over time and earn the real fortunes. The cannabis space right now is very much akin to a 21st century gold rush. While growing weed is a much more systematic business than mining for gold, the ability for companies to "strike it rich" will be severely diminished given the low barriers to entry and sheer amount of competition in the space. Think of it like this: how much gold can you really mine if you are sharing the same creek with 50 other miners? You won't be the one pulling all the gold out of the ground. This is simply to say that ultimately I expect the % net income margins of most large weed businesses in the future will be in the mid to high single digit range - a fundamentally low margin business and not the type of enterprises that see their market caps really explode long term. In addition, similar to the alcoholic beverage industry, there will also always be a want for niche, small batch product, preventing too much in the way of consolidation. Like the gold rush, we want to be invested in the people selling the mining equipment. However, in the 21st century, this equipment looks a lot different. Grow beds, Lighting, and hydroponic equipment will be the picks and shovels of tomorrow, and there are only a few public companies that sell them - GRWG and HYFM. In addition, I expect that these companies will continue to lead, given that they have the head start of being public & attracting investment from the capital markets - a key competitive advantage. But these companies have hot stocks that are doing well. How can we remove risk from this trade and try to take advantage of some 21st century gold rush arbitrage? The answer: short the most bloated, worst Canadian weed producers. Why Canadian weed producers? Because they are behind the 8 ball when it comes to building out MSO operations in the United States, and the US is projected to account for over 90% of the total global market for weed and CBD products. In other words, right now they are trading at a VERY expensive valuation compared to what they will be able to make in the future. Take CGC for example, one of the two stocks I have selected for this trade: Canopy Growth trades at C$16B market cap and 40x EV/Sales despite reporting only C$135M revenue and negative C$86M EBITDA last quarter. The company has no near-term path to break-even EBITDA and has already burned through $3.5B of the $5.0B cash from Constellation. Who would want to be long this company at these prices? Going long CGC you are getting a company that owns 13% of the 3B canadian weed market, which in it's entirety is smaller than California alone (~4B). Why pay FORTY TIMES EV/SALES??? Cronos, the other Canadian weed stock I've selected as a hedge, is even worse. So to recap: We want to look to go long the two companies that will be selling picks and shovels at healthy net income margins to the enormous U.S. market, while shorting the two most overvalued companies that operate in an extremely low margin, smaller Canadian market. Hopefully both sides of this trade will generate alpha over time, but the reason this works as a hedge is that all four companies trade within the "weed" basket, allowing some of the correlation % to be offset. Cheers! -P
NASDAQ:HYFMLong
by PropNotes
52