High Tide Inc. ( HITI ) reported strong financial performance for Q4-2025 last Thursday. The company recorded higher revenues as it began to receive proceeds from its Remexian acquisition. The company expects increasing revenues from the venture, which operatesWelcome to the home of The Cannabis Report. I cover the cannabis sector and other sectors. I am most interested in technical stock analysis, option strategies, small cap strategies, and emerging markets. Feel free to contact me with any questions abou ...

Core Insights - High Tide Inc. (HITI) reported record fiscal Q4 results for the August-October period, driven by the success of its primary Canadian cannabis retail business, leading to record revenue and EBITDA for the quarter [1] Financial Performance - The company's cannabis retail business in Canada continues to thrive, contributing significantly to the record financial results [1] Investment Philosophy - The investment philosophy focuses on identifying mispriced securities by understanding the drivers behind a company's financials, often revealed through a DCF model valuation, which allows for a comprehensive assessment of a stock's prospects [1]

Core Insights - High Tide Inc. (HITI) reported record fiscal Q4 results for the August-October period, driven by the success of its primary Canadian cannabis retail business, leading to record revenue and EBITDA for the quarter [1] Financial Performance - The company's cannabis retail business in Canada continues to thrive, contributing significantly to the record financial results [1] Investment Philosophy - The investment philosophy focuses on identifying mispriced securities by understanding the drivers behind a company's financials, often revealed through a DCF model valuation, allowing for a comprehensive assessment of a stock's prospects [1]

Management repeatedly emphasized the strength of the core Canadian retail business. Grover said same-store sales growth of 5.5% helped drive 15% year-over-year growth in the brick-and-mortar segment. He also said the company added 27 stores organically during calendar 2025, meeting the high end of its 20–30 store target, and set a goal to add another 20–30 stores in calendar 2026.Mahajan also pointed to operating leverage, noting salaries and wages fell to 11.5% of revenue , the lowest level in nine quarter ...

Financial Data and Key Metrics Changes - High Tide reported record revenue of CAD 164 million for Q4 2025, representing a 19% year-over-year increase and a 10% sequential increase [7][26] - The annual revenue run rate exceeded CAD 650 million, with record Adjusted EBITDA of CAD 12.4 million, up 51% year-over-year [7][28] - Consolidated gross margins were 26% in Q4, consistent with the previous year, while Adjusted EBITDA margins reached a new record of 9.4% [27][28] Business Line Data and Key Metrics Changes - The brick-and-mortar segment led revenue growth, achieving a 15% year-over-year increase, driven by same-store sales growth of 5.5% [7][26] - Cabanalytics, the business data and insight platform, generated CAD 13.1 million in Q4, up 20% year-over-year [26] - The adjusted EBITDA for the brick-and-mortar segment was CAD 14.1 million, highlighting strong cost controls and operational efficiency [28] Market Data and Key Metrics Changes - Canna Cabana's market share in the five provinces increased to 12%, up from 11% a year ago, while total industry sales in these provinces grew by only 4% [11][12] - The average Canna Cabana store generated an annual revenue run rate of CAD 2.6 million, significantly higher than the peer average of CAD 1.2 million [11] - The company has expanded its store count by 27% in Ontario, accounting for all growth in the province, while the rest of the industry remained flat [15] Company Strategy and Development Direction - High Tide aims to add another 20-30 new stores in 2026, continuing its focus on organic growth [8] - The company is exploring M&A opportunities, with discussions ongoing regarding potential acquisitions [8][56] - High Tide's strategy includes leveraging relationships with licensed producers to enhance procurement and operational efficiency, particularly in the German market through the acquisition of Remaxion [19][70] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth, particularly in the German medical cannabis market, despite short-term challenges related to inventory [22][40] - The company anticipates that the U.S. regulatory environment may shift positively, creating opportunities for strategic partnerships and market entry [75] - Management highlighted the resilience of the business model, noting that competitors are exiting the market, which could provide further growth opportunities [56] Other Important Information - High Tide generated CAD 12 million of Free Cash Flow for the fiscal year, meeting its goal of remaining positive [32] - The company has a strong balance sheet with total debt of CAD 65.5 million and CAD 47.9 million in cash and cash equivalents [32] - The Cabana Club loyalty program has grown to 2.5 million members, up 45% year-over-year, contributing to customer retention and sales growth [9][47] Q&A Session Summary Question: Impact of inventory issues in Germany on Q1 results - Management acknowledged that inventory issues in Portugal would impact Q1 results but expressed confidence in future growth once these challenges are resolved [36][40] Question: Brick-and-mortar business margins and growth - Management confirmed that brick-and-mortar margins have increased for four consecutive quarters, driven by strong sales and operational efficiencies [41][46] Question: M&A environment and competitor exits - Management noted that smaller competitors are exiting the market, creating opportunities for potential acquisitions, and expressed optimism about future M&A activity [56][57] Question: Budtender training and engagement - Management emphasized the importance of budtender training and engagement to enhance customer experience and brand loyalty [64] Question: January performance and Remaxion's outlook - Management reported improved performance in January compared to previous months and expressed optimism about future gross margins for Remaxion [67][68]

Financial Data and Key Metrics Changes - High Tide reported record revenue of CAD 164 million for Q4 2025, representing a 19% year-over-year increase and a 10% sequential increase [7][26] - The annual revenue run rate exceeded CAD 650 million, with record Adjusted EBITDA of CAD 12.4 million, up 51% year-over-year [7][28] - Consolidated gross margins were 26% in Q4, consistent with the previous year, while Adjusted EBITDA margins reached a new record of 9.4% [27][28] Business Line Data and Key Metrics Changes - The brick-and-mortar segment led revenue growth, achieving a 15% year-over-year increase, driven by same-store sales growth of 5.5% [7][26] - Cabanalytics, the business data and insight platform, generated CAD 13.1 million in Q4, up 20% year-over-year [26] - The adjusted EBITDA for the brick-and-mortar segment was CAD 14.1 million, highlighting strong cost controls and operational efficiency [28] Market Data and Key Metrics Changes - Canna Cabana's market share in the five provinces increased to 12%, up from 11% a year ago, while total industry sales in these provinces grew by only 4% [11][12] - The average Canna Cabana store generated an annual revenue run rate of CAD 2.6 million, significantly higher than the peer average of CAD 1.2 million [11] - The company added 27 stores in 2025, with plans to add another 20-30 stores in 2026, despite increased competition [8][24] Company Strategy and Development Direction - High Tide aims to continue organic growth through store expansion and enhancing its brand presence, with a robust pipeline of new store locations [8][24] - The company is exploring M&A opportunities, particularly in light of the retail shakeout in the cannabis industry, with discussions ongoing regarding potential acquisitions [8][56] - High Tide's strategy includes leveraging relationships with licensed producers to enhance procurement and operational efficiencies, particularly in the German medical cannabis market through the acquisition of Remaxion [16][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth, particularly in the German market, despite short-term challenges related to inventory and supply chain issues [16][22] - The company remains confident in its ability to outperform competitors and capitalize on market opportunities, especially as weaker operators exit the market [14][54] - Management highlighted the importance of the Cabana Club loyalty program, which has seen significant growth, contributing to customer retention and brand loyalty [10][47] Other Important Information - High Tide generated CAD 12 million in free cash flow for the fiscal year, meeting its goal of remaining positive [9][32] - The company has a strong balance sheet with total debt of CAD 65.5 million and CAD 47.9 million in cash and cash equivalents [32] - An impairment of CAD 23.6 million was recorded for the e-commerce segment, reflecting challenges faced in that area [29] Q&A Session Summary Question: Impact of inventory issues in Germany on Q1 results - Management acknowledged that inventory issues in Portugal would impact Q1 results but expressed optimism for recovery in subsequent quarters [36][38] Question: Brick-and-mortar business margins - Management confirmed that brick-and-mortar margins have increased for four consecutive quarters, driven by strong sales and operational efficiencies [41][46] Question: M&A environment and competitor exit - Management noted that smaller competitors are exiting the market, creating opportunities for potential acquisitions, and expressed confidence in High Tide's growth strategy [55][56] Question: Budtender training and engagement - Management emphasized the importance of budtender training and engagement to enhance customer experience and brand loyalty [64][66] Question: Remaxion's performance and future prospects - Management reported improved performance in January and expressed confidence in achieving higher gross margins as new biomass is procured [67][70]

Financial Data and Key Metrics Changes - High Tide reported record revenue of CAD 164 million for Q4, representing a 19% year-over-year increase and a 10% sequential increase [6][28] - The annual revenue run rate exceeded CAD 650 million, with record Adjusted EBITDA of CAD 12.4 million, marking a 51% year-over-year growth [6][30] - Consolidated gross margins were 26% in Q4, consistent with the previous year, while Adjusted EBITDA margins reached a new record of 9.4% [29][30] Business Line Data and Key Metrics Changes - The brick-and-mortar segment led revenue growth, achieving a 15% year-over-year increase, driven by same-store sales growth of 5.5% [6][28] - Cabanalytics, the business data and insight platform, generated CAD 13.1 million in Q4, up 20% year-over-year [28] - The adjusted EBITDA for the brick-and-mortar segment was CAD 14.1 million, highlighting strong cost controls and operational efficiency [30] Market Data and Key Metrics Changes - Canna Cabana's market share in the five provinces increased to 12%, up from 11% a year ago, while total industry sales in these provinces grew by only 4% [11][12] - The average Canna Cabana store had an annual revenue run rate of CAD 2.6 million, significantly higher than the peer average of CAD 1.2 million [11] - The company added 27 stores in 2025, with plans to add another 20-30 stores in 2026, indicating a robust growth strategy [7][8] Company Strategy and Development Direction - High Tide is focused on organic growth, with a strong emphasis on high-quality locations for new stores [8] - The company is exploring M&A opportunities, particularly in the German medical cannabis market, following the acquisition of a majority stake in Remaxion [17][19] - The strategy includes leveraging relationships with licensed producers to procure cannabis at lower costs, enhancing operational efficiency [20][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth, particularly in the German market, despite short-term challenges related to inventory [41][43] - The company is confident in its ability to navigate competitive pressures in Canada, with a strong brand and customer loyalty driving same-store sales growth [56][57] - Management highlighted the potential for significant growth in the U.S. market following regulatory changes, while remaining cautious about entering partnerships [78][79] Other Important Information - High Tide generated CAD 12 million of Free Cash Flow for the fiscal year, meeting its goal of remaining positive [35] - The company has a strong balance sheet with total debt of CAD 65.5 million and CAD 47.9 million in cash and cash equivalents [35] - The integration of Remaxion is progressing well, with expectations for improved financial contributions in the future [20][22] Q&A Session Summary Question: Impact of inventory issues in Germany on Q1 results - Management acknowledged that the Portugal inventory issue impacted Q4 results and will continue to affect Q1, but expressed optimism for recovery in subsequent quarters [39][41] Question: Brick-and-mortar business margins and growth - Management confirmed that brick-and-mortar margins have increased for four consecutive quarters, driven by strong sales and operational efficiencies [44][46] Question: Competition and M&A environment - Management noted that smaller competitors are exiting the market, creating opportunities for M&A, and expressed confidence in High Tide's growth prospects [59][60] Question: Budtender training and engagement - Management emphasized the importance of budtender training and engagement to enhance customer experience and brand loyalty [66][69] Question: Strategic partnerships in the U.S. market - Management indicated that while there is interest from U.S. operators, they are proceeding cautiously and evaluating potential partnerships as regulations evolve [78][79]

High Tide Reports Fourth Quarter and 2025 Year End Financial Results Featuring Record Revenue and Adjusted EBITDA [Accessibility Statement] Skip NavigationThe Company remains FCF positive for the fiscal year, while delivering strong same-store sales growth and cementing its presence within the German medical cannabis market- High Tide Remains the Highest Revenue Generating Cannabis Company Reporting in Canadian Dollars,1 and Continues to Hold a Leading 12% Share of the Cannabis Retail Market Across the Five ...

Core Viewpoint - Options markets are indicating significant post-earnings volatility for several stocks, particularly regional banks, with expectations of price swings being amplified by the Federal Reserve's policy decision [1][2]. Group 1: Implied Moves and Earnings Reports - Options markets are pricing in double-digit to near-50% post-earnings swings for a group of regional banks [2]. - Ten stocks are highlighted with implied moves of approximately 30% or more ahead of their earnings reports this week [3]. - Capitol Federal Financial, Inc. is expected to have the highest implied move at 48.48%, with earnings per share projected at 15 cents and revenue at $57.51 million [5][6]. - First Financial Bancorp follows closely with a 47.50% implied move, expecting earnings per share of 56 cents and revenue of $245.83 million [5][6]. - Other notable stocks include Provident Financial Services, Inc. (39.22% implied move), First BanCorp (39.09% implied move), and West Bancorporation, Inc. (35.92% implied move) [5][6]. Group 2: Specific Stock Details - Beacon Financial Corp. anticipates earnings per share of 79 cents and revenue of $224.81 million, with an implied move of 29.48% [5]. - ConnectOne Bancorp, Inc. expects earnings per share of 73 cents and revenue of $110.15 million, with an implied move of 29.51% [5]. - High Tide Inc., the only non-bank on the list, is set to report earnings per share of $0.01 and revenue of $114.95 million, with an implied move of 30.12% [5]. - Primis Financial Corp. is projected to have earnings per share of $1.10 and revenue of $34.98 million, with an implied move of 31.17% [5]. - Hope Bancorp, Inc. expects earnings per share of 26 cents and revenue of $142.91 million, with an implied move of 32.94% [5].

Core Insights - High Tide Inc. will release its financial and operational results for the quarter and year ended October 31, 2025, on January 29, 2026, after market close [1] - A webcast will be held on January 30, 2026, at 11:30 AM Eastern Time to discuss the financial results and plans for 2026 [2] Company Overview - High Tide is a leading retail-forward cannabis enterprise with a focus on delivering value across all components of cannabis [4] - Canna Cabana, a wholly owned subsidiary, is the second-largest cannabis retail brand globally, operating 218 locations in Canada and holding a 12% market share [4] - High Tide has been recognized as one of Canada's Top Growing Companies for five consecutive years and ranked number one in the retail category on the Financial Times list of Americas' Fastest Growing Companies for 2023 [6] Operational Highlights - High Tide operates multiple global e-commerce platforms offering accessories and hemp-derived CBD products [4] - Remexian Pharma GmbH, a subsidiary, is a leading German pharmaceutical company focused on the importation and wholesale of medical cannabis products [5]