I’ll show you today how I plan to make the easiest US$5 billion of my life. That’s right. $5 b-b-b-billion. And it’s easy money:

I’m a newsletter writer with monthly subscribers. I just charge my monthly subscribers more money.

Now, to make $5 billion I would need 137 million subscribers – just like Netflix (NFLX-NASD). That’s what they did recently increasing their fees by $3/month on their 137 million subscribers – for a total of an extra $4.932 billion a year… each and every year. In Year 2 you’re $10 billion ahead; in Year 3 it’s $15 billion extra cash. Pretty soon you’re talking real dollars.

Now, believe it or not, there’s good news AND bad news to this. The Bad News is that we are not the first people to figure out that there’s a lot of easy money in this business. Disney figured this out, as did Amazon, Facebook, Hulu, Comcast, Viacom and a host of other billion-dollar entertainment companies.

The Good News – especially for investors in the company I’ll disclose on Wednesday – is that everybody wants to be Netflix now… and who can blame them? They all want to be able to earn a quick & easy $5 billion with their own streaming services – and are moving in that direction fast.

As a result, groups like Disney are pulling their content from 3^rd party streamers like Netflix and starting their own streaming platforms.

This means that now – more than ever – Netflix and all the other copycats – they need content; quality content. If at all possible, family content so the kids demand to subscribe year after year. Want to hear the VERY GOOD news? I think I’ve found the next PIXAR.

Seriously. I will be stunned if you don’t agree with me after I tell you who it is.

This small-cap stock has EVERYTHING I want:

1. It’s in an industry that’s growing quickly (see chart below OMG)
2. Two of senior management have built and monetized a major content creator
3. Company has net cash
4. EBITDA has doubled each of the last two years; 100% CAGR
5. Tight share structure, and management owns a bunch of it
6. Half the valuation of their peers
7. Major studios & streaming companies already ASK THEM to do shows for them. They’re already at The Table with The Big Boys.

I’m not kidding – I could go on. This company is in the cat bird’s seat for one of the biggest capital spends the world has ever seen. They’ve shown they can make money – really good money – doing it. And their timing is impeccable. That’s why I’m long.

The macro story here is very easy. A few short years ago, Netflix turned the global entertainment industry upside down on everybody else. They took The Power in this global industry away from the networks and major studios and gave it to the artists creating content. Power to the People! And we’re all better off for it.  (This is such an empowering story where The Little Guy Wins all-around.)

But now – everybody else is getting even. Copycat services are starting up, and many of The Big Studios are pulling their content to start their own Netflix-style service.

That’s not just Good News – it’s VERY VERY GOOD NEWS… because you know what means? They all need high quality content! Demand is rising… especially for high quality content. You know what happens when demand goes higher? Prices go higher. These companies are now spending billions of new dollars in a race to find The Next Big Binge-Watch.

Look at this chart on the kind of money the industry is spending on content in 2019:

The appeal of the Netflix subscription business model is obvious. It is a huge recurring cash flow stream… big enough to attract these enormous companies and their absurd purchasing power.

The billions spent on content has been steadily rising for years now, but even this massive spending spree got a huge turbo-boost when Disney pulled its content from Netflix just over a year ago.

Many… most actually… networks and Big Studios are starting their own streaming service. Every major studio and network wants their own flagship show like Breaking Bad or House of Cards – and they want to own the customer.

That is making content creators The Kings of the global entertainment industry.

So you won’t be able to watch Disney animation, Star Wars films, Marvel movies or anything else that Disney owns unless you subscribe through Disney itself.

So not only is Netflix now facing the likes of Amazon, Apple, Google and others as competition… but it is also losing vital content from the likes of Disney who will also become a competing force.

The Turbo-Charge to Revenue and Earnings

EBITDA has doubled each of the last two years at this high-quality content provider. But I think there could be even higher profitability in the next several years, and here’s why:

1. Merchandising revenue
2. IP control = recurring revenue

If you have young children, you know that Paw Patrol is a cartoon TV series that has dogs playing roles like police, fire, construction worker and recycler – all in different colors – and they rescue each other when they get into trouble.

You probably don’t know that Paw Patrol has brought in as much as $300 million in annual merchandising revenues to its Canadian owners. CHA CHA CHA!

That’s what can happen when a children’s program hits it with audiences around the globe – and it’s a bonanza for shareholders as well as the kids.

To make that kind of Big Dough however, you have to own the Intellectual Property, or IP, behind the shows you make… and this small-cap content provider is keeping more of their IP than ever before.

It certainly helps your negotiating position when The Big Studios invite you in and ask you to produce some their ideas – which is where my favourite small cap entertainment play is now.

The Upside of Animation is HUGE…BILLIONS

Disney bought Pixar in 2006 for $7.4 billion, after realizing they could not match Pixar’s high quality content. It ended up being a HUGE win for Disney, as the most memorable animated movies in the coming years – like Lion King – came with Pixar management at the helm of Disney animation.

This team is very focused on creating an animation blockbuster. They have ex-Pixar people on staff.

How long until they create the next global blockbuster that sends this… really, it’s a micro-cap… into a household name around the world? I mean, this company already has a potential backlog of $170 million in projects with Tier 1 content suppliers, but if they develop another Paw Patrol and get some $300 million in just one year, just from merchandising… this stock rocks.

DO NOT MISS MY NEXT EMAIL!!!

In my next e-mail I will show you where I have put my money – the stock through which I intend to take advantage of the desperate scramble to secure entertainment content.

I’ve always said — one of the best ways to make money in the markets is to find the smallest company in the best play. Right now entertainment has one of the largest tailwinds of any sector in the world.

This industry has gone from spending hundreds of millions to billions to now tens of billions of dollars a year creating new, high-quality content for you to watch. The competition amongst studios has never been more intense, and I know one thing for sure:

THEY. WILL. PAY.

In that e-mail I will lay out the following details about the company in the sweetest spot in the most turbo-charged capital spend ever seen:

1 – Details of the proven leadership group that have built AND monetized huge entertainment companies before The company’s balance sheet that has net cash

2 – The tightly held share structure

3 – The huge business backlog that is certain to drive revenue and cash flow growth over the next several years

4 – The company’s valuable library of existing content that includes #1 rated programs

5 – The very good reason why I believe that this company is the next PIXAR – a grand slam homerun global entertainment business.

Like I said at the top of this story… I can show you how to make $5 billion very easily. But the guy who really will do that… will have to go through this company. And he will pay.

You will find out all of the reasons why I’m long… and I can’t wait to tell you the full story on Wednesday.

Keith Schaefer

Folks, junior lithium stocks are not in vogue right now, but I felt I had to go on Standard Lithium’s (SLL-TSX, STLHF-OTC) property tour this week in the small town of El Dorado Arkansas, just north of the Louisiana border.

It’s because I think they have something VERY special, and I think they are on the cusp of being able to prove that to the Market (and of course I’m hoping that makes a big difference in their share price).

This investment will probably take a big longer to mature than what I like, but I want you to think about Mitchell Energy, built and sold by shale oil pioneer George Mitchell to Devon Energy for $3.1 billion in 2001.

George put hydraulic fracturing together with horizontal drilling and unlocked an entirely new source for oil. It was a global game changer. He gave the world Shale Oil. It revolutionized oil production, upset the balance of oil power in the world, prevented $200/barrel oil and created prosperity for tens of thousands of investors and workers alike.

That’s what I think Standard Lithium has. They have developed a very simple process that isolates and removes lithium from underground water formations – which are abundant. Their proprietary process is

1. CLEAN – environmentally friendly
2. CHEAP – low-cost; they don’t need to add any energy to the already hot brine (I think it will be THE cheapest source of lithium anywhere in the world within a couple years),
3. FAST – only takes 1 hour to remove lithium, and they can re-inject the brine back down into the formation in four hours. Folks, those big brines up in the Atacama are in evaporation ponds that take 18 months to concentrate before going to a lithium refinery. 18 months to 1 hour. Scouts’ Honor.

This is a win-win-win-ad-infinitum development. The only way it’s not is if Standard Lithium gets taken out too early by Lanxess or some other big chemical company. If you leave this story remembering one thing, think SLL lithium = cheap, clean and very very fast. And now they have a BIG partner to commercialize it all.

This is still early days for Standard Lithium investors, and that will mean a bit of patience.  But Robinson and his team of chemical engineering PhDs do have a process that works – extracts very high recoveries of lithium – at bench and pilot scale. SLL recently bought the entire rights to the process from the consulting scientist on the team who provided the breakthrough.

Point #4 would be– it’s a very simple process, but I didn’t want to overwhelm you. This process is simple, is patent pending, and is quick and clean and cheap.  You can see it here: https://standardlithium.com/lithium-arkansas-smackover/ and here in the powerpoint https://standardlithium.com/standard-investors/

In a nutshell, the hot brine comes into contact with a ceramic adsorbent – a fancy name for tiny crystals that just the lithium ions in the brine attach to. That takes all of 1 hour. A simple Stage 2 removes the lithium ions from the ceramic. Initial results show 95% ++ recovery. No fancy or expensive materials. Simple. Clean. Cheap. Fast. (See, I explained the whole thing in one paragraph!)

With that, SLL has signed a deal with a big German chemical company called Lanxess (LNXSF-OTC)
(primarily trades in Germany, USD$6 billion market cap, 74 chemical plants and 19000 employees) to install a lithium module onto one of their bromine plants in southern Arkansas.

In 2017, Lanxess paid $2.7 billion for the three bromine plants in that area, and each taps into the humungous Smackover Formation, an underground water aquifer that stretches from Florida in the east to Texas in the west, and northern Louisiana and a big chunk of Arkansas.

In total, they pull up and put down about 500,000 barrels or more than 21 million gallons/80 million litres of brine a day from the Smackover, and extract the bromine from it. Bromine is mostly used as a flame retardant and to purify water, but has many uses.

Standard Lithium has developed and is now patenting a process to extract the lithium from that same hot brine.  They cut a deal with Lanxess to run the residual brine – after the bromine has been extracted – through a specially built lithium-extraction module on their grounds.

That’s what we went to see on this property tour – the Lanxess bromine plant.  These are  massive operations, but for SLL itself, I have to tell you, we didn’t really see much – in fact you could argue we didn’t see anything, except a flat piece of ground inside the permitted area of Lanxess operations where the pilot plant will go.

Yep, I took 3 days off to see a patch of grass.

The value in the trip was meeting Lanxess officials. We were able to see how they interacted with Mintak & Robinson (M&R), ask them questions about the logistics around and their commitment to the project, meet the SLL site manager etc. And get a sense of how much money they would need when to make all this happen.

Let me back up for a minute. It’s true that junior lithium stocks are not “hot” now, but fundamentally the lithium business is still quite profitable, and nobody is disputing the need to find and develop more lithium for the fast-growing EV market.

In economics, costs to produce lithium are ranging from roughly $3500 per tonne to $8000 per tonne for and sells anywhere from $11,000 – $14,000 per tonne now. In 2017 it got as high as $25,000 per tonne in China.

In geology & production, most lithium either comes from huge ponds – and I mean km’s x km’s in area – up in the remote Atacama desert at 14,000 feet elevation on the Chilean/Argentine border, or from hardrock mining (the minerals are called spodumene or lepidolite) in Africa and Australia.

Most lithium mines are quite old, and the geologists and engineers who put them into production have retired.  The majors in the industry – Albemarle (ALB-NYSE) and SQM(SQM-NYSE) out of Chile – keep saying they will have enough supply to fill demand for years, but most people are very skeptical of that.

A new junior producer, Orocobre (ORL-TSX) has had a very difficult time getting their new brine ponds to perform to what they hoped up in Argentina. Lithium Americas (LAC-TSX) is also trying to put a new asset into production in Argentina. And there’s a new hardrock deposit in Quebec by Nemaska (NMX-TSX).

The point is, it’s all more of the same. AND the majors are having big public squabbles with the Chilean government over water, and having to deal with massive currency devaluation in Argentina.

Standard Lithium and Lanxess have the potential to quickly – within 3-4 years – develop a massive new supply of lithium in the USA in an area with abundant skilled labour – I mean, the local colleges around El Dorado offer courses in the technical and managerial aspects of bromine extraction. You could not have asked God to put this massive lithium resource in a better place.

It’s worth understanding how Standard got the Lanxess deal. When M&R identified the Smackover as a great potential source of lithium-rich brine, they spoke to a company called Chemtura in 2017, who owned the bromine plants then.

Chemtura was quite open to the idea of running a lithium module after their bromine extraction, and M&R moved things along quickly. Chemtura had no interest in lithium and was happy with a passive royalty or toll charge.

But then Lanxess bought them out as M&R were talking to them.  Lanxess is a BIG company, and their German thoroughness showed through immediately. Talks slowed, but Lanxess did their homework. They hired outside consultants to educate them about lithium, and after studying the market, agreed to a joint venture and pilot plant.

Now that sounds like it was easy, but I want you to think about what that really means. It means a multi-billion-dollar chemical conglomerate with thousands of employees believes that SLL’s process can move the needle for them.

At the site visit, the incoming site manager – flown in from Germany to live here in rural Arkansas (El Dorado is 18,000 people) said the southern Arkansas assets represent about one eighth of the full company now – that would be US$1 billion. So it’s a meaningful chunk.

This big company believes SLL’s process – assuming it works at scale like M&R say it can – can be installed at all three plants over time. It all really does make sense – this is a great new revenue stream for Lanxess out of an existing asset, but you never know what the internal politics & incentives are at these big companies.

Lithium grades are in the 150-500 ppm range, which is great economics especially on the kind of huge scale Lanxess could build here.

In fact, they can now go back to areas that they have produced out, i.e. exhausted the local bromine in a part of the Smackover, and now go back in and get lithium revenues from it. I’ll bet a steak dinner they discovered that lithium will be a lot more profitable than bromine. And they get a risk-free, exclusive front row seat as SLL proves out their process at scale.

But a commitment to an entirely new product for Lanxess is a big deal. The lithium extraction is complementary, and handling lithium is much safer and simpler than bromine, so there is no Health & Safety issues.

And M&R really believe they will be at the bottom (toe) of the cost curve, setting a new bar for the industry worldwide. Plus there is a very long runway here… EVs are expected to take over from ICE (Internal Combustion Engines) over time.

There could be a 50-100 year runway here, and this is like investing in Henry Ford’s first Model-T shop.

Again, Lanxess’s decision makes sense – but appreciate that this had to get sign off from the top in Germany.

Lanxess would not have made this decision without speaking to the senior management of the big German automakers – NO WAY. When you think of the weight and gravity behind their decision, this is A BIG DEAL for them – and for Standard Lithium.

I would caution the Lanxess deal that’s in the public domain is still very nebulous, with language like… “remain subject to completion of due diligence.” But certainly on site, they were vocal and keen to see this pilot plant built ASAP and move forward.

My understanding is that SLL has to fund and build the pilot plant, but Lanxess will foot the bill for the entire construction cost of the first commercial facility, and SLL will get a profit share out of that.  But again, the final version of the contract hasn’t been done.

SLL must raise several million dollars to get them through to where Lanxess takes over the capex; at least US$10 million and likely more.

What I like is that this team has built something so quickly – the company is only two years old, and they have a new, clean, cheap and fast process and a big partner and a colossal brine source… they have done everything from both a technical/geologic/engineering point of view and business point of view.

Very few junior teams do this. I mean, this is really rare.

The only thing they haven’t done as well as I would like is to tell the beautiful simplicity of this story. Clean. Cheap. Simple – and most of all – FAST. This will be the lowest cost and most abundant lithium source in the world – well inside five years – in an industry that should run for 50. It’s right at home in the USA, and has a Big Partner funding it.

So can they raise this money to get them to capex? Juniors generally need a bull market in their commodity to raise funds, and the lithium price has come down from $20,000 per tonne to $12,000 – and stayed there.

In 2017, these junior lithium stocks had huge runs, making investors a lot of money. I made a big schwack on Lithium X (40 cents to $2.50 in months) and here at Standard Lithium (75 cents to $2.80 in months).

But in February 2018, US brokerage firm Morgan Stanley came out with what turned out to be a stock-killing report, saying the lithium market would be oversupplied and #1 world producer Albemarle was a short.

Basically, the equity window for junior lithium stories shut soon after that. Raising funds for lithium juniors remains very challenged to this day – unless you have something very special. I think Standard Lithium has something not only special, but unique.

Their process is unique – and it’s simple.  You put the lithium in an agitating vat for an hour with a ceramic adsorbent and they have found the “thing” that attracts & separates out the lithium. Their relationship with Lanxess, or any big major, is unique. Their ability to scale up to large production volumes very quickly is unique.

M&R were recruited/seduced away from their previous gig by SLL Chairman and large shareholder Bob Cross. Bob is chairman of B2 Gold (BTO-TSX), and was Chairman of Northern Orion, one of the most profitable copper plays of the 2000s. He was a top investment banker at brokerage firm Gordon Capital before that, when they were the power boutique on the Street.

In other words, he knows how to read a market and raise money.

Note that the stock is just trying to break through its 200 day moving average. I’m long, and I’m excited to watch this move forward.

Catalysts this year will include
1. a Preliminary Economic Assessment on the larger Lanxess property,
2. results from the larger demonstration plant in Ontario,
3. the building of the even larger pilot plant on the Lanxess property

Clean. Cheap. Fast. The new lithium that I think makes all the other juniors obsolete, and introduces some real competition into Albemarle and SQM. And it’s just over $1/share.
Keith Schaefer

Plus Products Inc. (PLUS:CSE / PLPRF:OTC) is the cannabis business backed by the same high powered hedge fund that took as E-cigarette manufacturer JUUL – which went from being nothing more than an idea to a business valued at $38 billion in a span of just 40 months.

I don’t need to speculate whether that elite hedge fund can do the same thing with Plus Products – because I can already see it happening.

The hedge fund is Tiger Global Management – the PLUS prospectus shows they own over 6 million shares or 15% of the company – and it has an incredible track record of helping turn small companies in rapidly growing industries into multi-billion dollar businesses.

JUUL was the most recent homerun for Tiger Global. In December, tobacco giant Altria paid $12.8 billion for a 35% interest – valuing JUUL at $38 billion.

Take a look below at what Tiger Global and JUUL were able to achieve in terms of E-Cigarette market domination. In 40 months JUUL went from no market share to controlling more than 75% of the E-Cigarette market.

Tiger Global’s homerun with JUUL was not a one-off occurrence. Tiger Global also built Indian based e-commerce juggernaut Flipkart which was recently sold to Walmart for $16 billion. Tiger were also early investors in Spotify and Glassdoor – Tiger can spot HUGE winners very early.

Just Like JUUL –
Plus Products Inc. Is Steamrolling Competition

Like many investors, Tiger Global has rightfully identified cannabis as its next big homerun opportunity – and they’ve made Plus Products Inc. one of their biggest investments.

Plus Products Inc. is a cannabis company that is already dominating the market the way that JUUL did.

Plus Products is just starting to tell its incredible growth story, of becoming the #1 edibles brand in California. But its main stock listing is in Canada… not the United States; very much offer the radar.

The OTC listing for Plus Products Inc. only took place on January 24, 2019 – so it was more difficult for a huge group of US investors to look at the company until just last week.

What you are reading today is the “coming out party” for Plus Products Inc. in terms of market awareness.
And it’s perfect timing, as business performance is rocking.

Plus Products Inc. has been knocking it out of the park… in exactly the same manner that JUUL did on its way to become a $38 billion company. Plus Products Inc. has been taking cannabis edibles market share at a staggering rate.

This is not my opinion. These are verifiable facts by the top two cannabis market research firms – BDC Analytics and Headset.

California is – far and away – the largest and most important market for cannabis at this point. Everyone knows that cannabis will be legalized everywhere eventually, but for now California is the most important market by a mile.

In Q2 17, Plus Products was ranked #43 in California and had less than one-half of one percent share of the edible cannabis product market.

Barely 12 months later – by Q3 18 – Plus Products became ranked #1 in California and has increased its market share by 24 times now with 9.89 percent of the crucial California market. Revenue is at a $10 million run rate now and growing every month. And The Big News is – they’re about to go into more states.

It’s important to me – how and why that happened: It happened organically, with almost NO marketing–to become #1 in the #1 Market in the world right now!  It’s all about the quality and consistency of the product, and the logistics behind making sure it’s on every shelf on every store possible. Their edible products have an incredibly consistent dosage, much tighter than what the law says is necessary. Good product, good business execution.

Take a look at the chart above which shows what Tiger Global-backed Plus Products has done in just over a year in California… then look back at the chart that I showed you earlier with the incredible growth in market share that Tiger Global backed JUUL was able to achieve.

Growth that took JUUL from no market share to being worth $38 billion in 40 months.

This is no coincidence and I can assure you of one thing… Tiger Global didn’t put invest Big Money into Plus Products without feeling very confident that it could be built into another multi-billion dollar, dominant business.

Plus Products is now getting ready to expand outside California. I think this will be the biggest growth story in the sector in the next 18 months. And one of their largest backers has done it all before – grown something from zero to a $38 billion dollar company in just 40 months.

This stock has only 40 million shares out… meaning this could be a HUGE winner if management executes like Tiger Global thinks they can. 

One Or Two Brands Will Control 
The Entire Cannabis Opportunity

There is no better investment than a dominant consumer brand.

Just ask Warren Buffett who built his $90 billion fortune by owning the dominant consumer brands of Coca-Cola, American Express and Gillette.

A brand name is the most valuable asset a retailer has because it lends credibility to product quality… consumers know what they can expect when they buy that brand name product.

As consumers we buy Coke or Pepsi because we know that we like it; the same thing for McDonalds or Wendy’s. Every retail market ends up being dominated by a few powerful brands.

As I’m sure you can imagine… for a product like an E-Cigarette or edible cannabis  – being able to trust the quality and safety of the product you are buying is even more important.

That is a big reason why JUUL was able to lock down a 75%market share. That is why the opportunity for Plus Products to do the same in cannabis is so very real… and in fact is already happening.

The truth is that it is going to be easier for Plus Products to dominate cannabis than it was for JUUL to dominate E-Cigarettes. Everything that Tiger Global built and learned with JUUL in E-Cigarettes is directly transferable to Plus Products and cannabis.

This gives Plus Products a huge advantage with marketing, distribution, manufacturing, talent, financing… you name it, Plus Products has the edge. Having a multi-billion dollar hedge fund titan behind Plus Products is an incredible advantage.

You can see that advantage in how fast the Plus Products brands are taking market share.

Plus Products has almost US$20 million cash and has zero dollars of debt. Sales and revenue are increasing every month. They’re about to start expanding into several new states. Insiders are aligned and own a boatload full of shares… and so do I.

Tiger Global isn’t invested in Plus Products to build a nice little business. Tiger Global is invested here to build another multi-billion dollar business. And there’s only 40 million shares out.

I think my timing is excellent – right on the cusp of a major expansion, after already being #1 in the biggest market in the world right now. Whoever wins the California cannabis market could win the world… and Plus Products is already #1 and increasing that market share at an incredible clip.

With a big expansion plan on the immediate horizon, I expect this company to do very very well in 2019 and 2020.

DISCLOSURE—I am very long Plus Products Inc.

Keith Schaefer

Today I’ll tell you why I invested in “The JUUL” of the cannabis sector. I’ve just made it my largest investment ever into cannabis – and I have little doubt it will be my most profitable.

Some of the smartest money on the planet has invested in this company, and that’s what I follow in this sector – because it’s so new.

Because this young cannabis company has Smart Money behind it, it has almost $20 million cash, and a very tight share structure – most of these pot stocks have well over 100 million shares out. This one has less than HALF that many. That structure can make for explosive share price moves.

As the rest of  the institutional capital find what I believe to be “The JUUL” of the cannabis sector – I think they’ll pile into the company’s shares.

Tomorrow I’ll put this same opportunity in front of you – so pay attention to that e-mail – it identifies this company and everything you need to know about it.

After I let the cat of the bag on this one these shares will never be this cheap again.

I want you to fact check the details of what I’m about to tell you today and tomorrow… so you have my level of conviction on this company.

There would be too much regret to live with if you didn’t.

What Do I Mean By “The JUUL” Of The Cannabis Sector?

Just four years ago – right before cannabis became one of the fastest growing global markets – E-cigarettes had a similar experience, where this product went from niche to mainstream, making millionaires and billionaires for investors in a very short period of time.

Only 40 months ago – on June 1, 2015 PAX Labs introduced the JUUL electronic cigarette. At that point in time the product had zero sales and zero market value.

Only 18 months ago – in July 2017 JUUL was spun out of PAX Labs as an independent company. Until then it was JUUL buried inside of PAX.

Last month Altria paid $12.8 billion for a 35 percent stake in JUUL!!!

Simple math values the entirety of JUUL at $38 billion.

JUUL went from nothing to $38 billion in 40 months – that’s an incredible creation of massive wealth.

How did that happen you ask?

Over a 40 month period JUUL built the dominant e-cigarette brand on the planet.

By dominant I really mean DOMINANT….

CNBC reported at the time the Altria deal was closed that JUUL owned 75 percent of the e-cigarette market.

Back in July Bloomberg had that market share at 70.5% in the chart below.

Over that 40 month period everyone lucky enough to be involved with JUUL has gotten rich.

When the deal with Altria was struck, JUUL announced that it would pay each of its 1,500 employees a bonus of $1.3 million.

In 40 months everyone involved with JUUL made enough money to retire.

Now it is my turn….

This Is Why I’m Certain This Company
Will Be “The JUUL” Of The Cannabis Sector

Now you know why the institutions are searching for “The JUUL” of the cannabis sector.

JUUL made thousands of  people rich in a hurry.

E-cigarettes was a new market that went from nothing to something large very quickly.

The unfolding cannabis market is very similar to that.

Today I’m here to tell you that “The JUUL” of the cannabis sector most certainly exists… and that I’ve found it. And that I own a lot of it!

This newly public company has not found its way onto the screens of analysts and institutions yet – but that will change with the next couple quarterlies. Revenue is increasing very rapidly.

That lack of market attention will change with my e-mail tomorrow which goes out not just to readers like you –but also to much of the analyst community.

What makes me convinced that I have found “The JUUL” of the cannabis sector?

Because the exact same secretive elite investment firm that built JUUL from the ground up are now building this cannabis company.

Literally… the exact same people.

These renowned billionaire investors (who I will reveal by name in my next e-mail) have a track record for building multi-billion dollar companies from the ground up.

These people built India based e-commerce juggernaut Flipkart which was recently sold to Walmart for $16 billion. They were early investors and involved in building Spotify, Glassdoor and other tech businesses as well.

This isn’t a leap of faith investing alongside these people.  They know how to pick early stage winners. There is little doubt this is going to work out well… the only question is how well?

I would gladly turn a good chunk of my money to them to invest with no knowledge of what they were going to invest in.

This secretive billionaire firm has rightfully identified cannabis as the next market to conquer and they have made exactly one cannabis investment… which is why I believe this company will be “The JUUL” of the cannabis space!

They have all of their eggs in this one cannabis basket.

This single little cannabis company is getting all of their attention, all of their knowledge, the benefit from all of the connections they have made through JUUL which is in an almost identical business.

Their involvement with this young cannabis company has generated shocking results already.

This single little cannabis company is getting

1. a huge chunk of their attention
2. all of their knowledge
3. the benefit from all of the connections they have made through JUUL – which is in an almost identical business

This young cannabis company has generated shocking results already:

In the last 24 months – with the involvement of these secretive investors – the company’s brand has moved from being #43 in the Market to #10 – and now #1 – with its lead expanding.

While this company’s market share has soared from 10^thto 1^stno other competitor has grown its market share at all… which means this company is taking it all!

Nothing short of market domination is the goal – just as JUUL did in the E-cigarette business with a now 75% market share.

These secretive billionaires did not invest here to build a nice little cannabis company. They are in this to build a company that dominates this industry and have it be worth billions of dollars!

These guys aren’t in this to build a nice little cannabis company. They are in this to build a multi-billion dollar company that dominates this industry. (I can hardly think what kind of share price that would mean for this company with less than 35 million shares out and trading under $10!)

Do Not Be Late Opening My E-Mail Tomorrow!!!

I rarely come across the opportunity to get in on the ground floor of what could be a life-changing investment.

This is an opportunity to invest at the ground floor level beside one of the greatest company building investment firms of all-time. To be honest, this almost isn’t a fair fight for the cannabis competition.

There is one more thing that I want you to appreciate.

The opportunity in cannabis is much, much larger than the opportunity in E-cigarettes was.

The E-cigarette market is expected to have total sales of $44 billion by 2023.

Meanwhile the global cannabis market is expected to hit $146 billion shortly thereafter.

JUUL went from nothing to a $38 billion valuation in 40 months in the E-cigarette market.

The same people that built JUUL are now working on building the same type of dominating company in the cannabis business. They clearly bet on the right horse, as this cannabis company now has the largest market share in the largest and most competitive cannabis market in the world… (verified by the Top 2 independent market research firms in cannabis no less!) and they did it in just 18 months.

If anything building this cannabis company will come easier for them given what they just learned building JUUL. These are similar industries and the connections that they have made in marketing, manufacturing and distribution can be leveraged.

Look….

I’ve been doing this a long time.

At this point I know when I’ve found a great investment idea.

And I really know when I’ve found an idea that my readership is going to love.

Tomorrow I’m telling you – and all of my massive list of e-mail readers which includes many analysts – all about “The JUUL” of the cannabis sector.

My first cannabis investment, Canopy Rivers, is up 50% in 5 weeks. I bought into that stock because it was Smart Money – the public merchant bank of Canopy Growth CEO Bruce Litton. They have the best deal flow and the deepest pockets. No-brainer!

But I have a much larger position in this company – the investors behind this company are that exciting.

You do not want to be late opening my e-mail to learn the following:

1. The name and ticker of this company
2. The details of this company’s already market leading brand
3. The incredible company building track record of the power players behind this business
4. Everything about the company’s current financial position

I feel lucky to be able to introduce you to this great company at this early stage. I am long, but you can fact check everything I tell you very easily.

Be ready to hear from me tomorrow!

Keith Schaefer

The Permian is the fastest growing oil play in the world – by far.  That can create big logistical problems, like a scarcity of pipeline space and deep discounts to other US oil hub prices. Or like higher service costs. How does a small operator navigate these issues, and what opportunities come out of this?

To find out, I sat down with Mehran Ehsan, CEO of Permex Petroleum (CSE:OIL).  Mehran just went public last year, and has since tripled his production. We talk pricing, we talk logistics, M&A opportunities, organic growth etc.

And I ask him- – how / why does the very shallow (and therefore low cost) San Andres formation – where Permex is operating – produce such light oil that gets great pricing? Oil geology doesn’t work that way; gooey heavy oil that gets a MUCH lower pricing usually sits on top in the shallow formations, with oil getting lighter as you get deeper (it gets more “cooked” with greater heat and pressure with depth) and eventually turns into natgas. Having a low cost formation produce such a high value hydrocarbon is unusual.

In this short interview, you will get a boots-on-the-ground perspective on how the Permian is developing, and what operators are doing to navigate all the challenges of being in the world’s fastest growing oil play.

There is always a bull market somewhere in energy – you just have to know where to look! To subscribe to my Oil and Gas Investments Bulletin independent research service, click HERE:

Click here for monthly access $ 59 a month (no refunds)

Click here for quarterly access $ 149 per quarter (30 days no-questions refund)

Keith Schaefer
Publisher, Oil and Gas Investments Bulletin

Canopy Rivers (RIV:TSXv; CNPOF:OTC) is the marijuana stock that has what billions of dollars of institutional money are desperately searching for…

That is – RAPIDLY GROWING FREE CASH FLOW!!!

Predictable and growing cash flow is what the institutions want. They have been searching for marijuana stocks with real business fundamentals and traditional valuations.

By mid-2019, I think that every institution that wants to deploy capital into the marijuana sector will own Canopy Rivers.

Today this business is already generating a good and growing amount of free cash flow. I’ll explain:

Think of Canopy Rivers as the private merchant bank of Canopy Growth (WEED-TSX) and its CEO Bruce Linton – but they’re allowing YOU to buy into their best-in-class deal flow.

With $5 billion cash, you can bet Canopy Growth sees a lot of companies they want to buy – all over the world. But some entrepreneurs don’t want to sell outright – and that’s where Canopy Rivers comes in.  Seeded by Canopy Growth, its management team and insiders, Canopy Rivers funds the best deal flow that Canopy Growth can’t buy.

I think it’s a great business model – they create a small-cap merchant bank and fund it enough so they can do several deals at once – any one of which can – and have – created multi-baggers big enough to show up in the Net Asset Value (NAV) of “Rivers”.  And they do no business in the US.

Canopy Growth has a controlling voting interest in Rivers’ stock, to make sure nobody can steal the company.  But they’ve set it up perfectly – there is almost no G&A in Rivers; everybody owns so much stock they don’t need the money.

Rivers already has 12 investments – and they use debt, convertible debt, pref shares, regular equity and royalties in their model – in mostly private but some public companies.

Think about this – just the investment income from their portfolio will be $15 million annualized at YE 2019, vs. cash G&A of just $7 million. Then of course, as their investments grow and mature, the cash flow net to them should increase – and by a lot. Here’s what my research shows annualized cash flow COULD look like in the coming 5 quarters:

That is not well understood by the market because quarterly financial filings come out months after cash flow is actually generated… so the institutions haven’t picked up on the story. Canopy Rivers just IPO’d late Q3 18 and is just starting to filter into stock screens.

By my calculations Canopy Rivers could see cash flow increase 6 to 10 times over the course of 2019.  As that happens, more institutions will be comfortable enough to own the stock.

That is why Canopy Rivers isn’t a marijuana stock that I own… it is why it is the only marijuana stock that I own!  It’s a (merchant) bank.  Banks make money.  Banks with debt that can convert into lucrative equity in select companies.  That’s what I mean by low-risk/high-reward.

Everyone knows that 2019 will be a huge year for the marijuana business. Momentum is growing in
Canada and internationally. The problem is that the institutions have no clear way to play it – the typical marijuana stock is all story and no substance.

Canopy Rivers is different. This is a business built on quality from top to bottom. This is a company that everyone can own… and everyone interested in the marijuana sector eventually will own.

It ticks every box on my investment checklist:

1.     Top notch management – CEO Bruce Linton and his team recognized as the BEST in the industry

2.     Management is hugely incentivized by equity ownership not big salaries (Linton is paid just $1/yr!)

3.     No debt and a huge cash balance – great balance sheet ($40 million net cash)

4.     Cash flow positive and growing fast – which could be up 6 to 10 times in 2019

5.     Has a low valuation relative to its growth rate (I’ll get to the specifics on that in a moment)

This company is the ONE marijuana stock that gives investors everything they could ask for – including a realistic valuation!

What Canopy Rivers Has In Store For 2019
Cash Flow, Cash Flow and More Cash Flow!

There is a lot to the Canopy Rivers Story, but I’m going to focus in on what I believe to be the main driver of growing cash flows – a joint venture called PharmHouse.

PharmHouse combines the marijuana expertise of Canopy Rivers and a large, seasoned North American greenhouse operator. The greenhouse partner is one of the world’s leading commercial agriculture and produce companies.

This partnership will be huge – it already has a long growth runway.

PharmHouse is retrofitting a massive, 1.3 million square foot greenhouse for cannabis production in Canada…and there are already plans to build another one of comparable size.

And then another, and another and another….

This is a brand-new, top-of-the-line production facility built by North America’s top greenhouse operator.  Comparing this to other, older facilities that many peers are using to grow marijuana – this is like comparing an iPhone with a 1980s mobile phone that was the size of an encyclopedia.

Production from this facility should be very profitable.  The anticipated selling price in 2019 will be $3.75 per gram, and management has been rightly basing all decisions on profit margins of just $1 per gram – and even that shows PharmHouse’s first facility generating $100 million of annualized free cash flow by the end of 2019.

Half of that production belongs to Canopy Rivers – which equals a run-rate of $50 million in cash flow from just this one asset by Year End 2019.

And PharmHouse is just one asset out of the 12 that Canopy Rivers has to offer!

This Is The Lowest Risk Lottery Ticket
You Will Ever Find In Marijuana

After PharmHouse, Canopy Rivers has 11 other marijuana projects underway. That means that Canopy Rivers’ shares come with free huge upside optionality… multi-bagger potential, lottery ticket winning type returns.

Canopy Rivers is an incredibly advantaged merchant bank. As a publicly traded sub of Canopy Growth, “Rivers” gets best-in-the-world-deal-flow… Canopy Rivers gets to put seed capital into the best marijuana start-up companies at incredibly favorable terms.

It’s like being in Silicon Valley and getting acccess to the seed financing of the Facebooks and Googles of the tech world.

Canopy Rivers can see huge increases in its share price as its investments go from millions to tens of millions or hundreds of millions of dollars… those returns would be lost on the balance sheet of the $12 b-b-b-illion market cap of Canopy Growth – which is why the deals are pushed to Canopy Rivers.

At least, that’s the way it’s supposed to work. It makes sense to me. 

Canopy Growth CEO Bruce Linton is the acting CEO/Chairman here, working for $1/yr and a whack of stock.

That means that you have…
1.       The best and most experienced management team in the marijuana world
2.       Giving “Rivers” the best deal flow they come across
3.       And they’re completely aligned with shareholders

Like I said, they already have a minimum $8 million in investment income for 2019 and easy-to-achieve milestones that pushes it to over $15 million – against cash G&A cost for the business of just over $7 million per year. All 35 employees at Canopy Growth also have equity linked exposure which incentivizes them to push top investment opportunities to Canopy Rivers.
 
In 2019, Year One of this business model, I’m really invested in Canopy Rivers because of the cash flow growth that PharmHouse could/should crank out by year end… it could be as much as $50 million net cash flow to Canopy Rivers by year-end and growing from there.

In a perfect world, Rivers is at an $84 million run rate this time next year – against an Enterprise Value today of some $520 million–about 6x EBITDA. 

Like every other management team in a public company, they must execute flawlessly for that valuation to make sense. But it’s certainly one the institutions could understand – and buy.

DISCLOSURE:  I am long Canopy Rivers.

Keith Schaefer

Every month I get asked to start a newsletter covering marijuana stocks.

I always say no.

I mean, I get it – this will be the fastest growing sector in 2019 – possibly in the whole world.

One of The Big Catalysts will likely come from the US – it’s The Big Dog in this market and it will almost certainly legalize marijuana federally sometime in 2019. We just saw bipartisan support for this with Congress passing the Farm Bill which legalized hemp and the status of CBD (Cannabidiol).

Not only is there an existing large market waiting to be filled, now medical research can begin in earnest to find even more positive benefits to cannabis products.

The investor opportunity is incredible – and I think we’re barely into the second inning of this ball game.

The problem I see – that has kept me out of this sector – is that these public company marijuana stocks are all story and no substance.  Most of them I wouldn’t touch with a ten-foot pole.

I really try to be an investor – fundamentals and intrinsic business value matter to me.

In fact, there’s only ONE marijuana stock I’ve ever found that has a near bullet proof business model and is executing its plan.

This company allows me to get exposure to the hyperbolic growth that the marijuana sector has in front of it (which nobody disputes) – but also ticks all of the fundamental boxes that every value investor like me would love.

To let you know how different this company is… it is the only stock in the marijuana space I’m willing to own right now.

This company fulfills all my criteria as a value focused investor:

1.     Top notch management – the BEST
2.     Management owns a lot of stock, and takes almost no salary
3.     No debt/net cash – one of the best balance sheets in the sector
4.     Cash flow positive and growing fast – cash flow could increase 6-10x in 2019
5.     Has a realistic, traditional valuation relative to its growth rate

And as a bonus, it’s business has nothing to do with the US – just yet. So I can still cross the border!

At first I was intrigued, but then I got excited. How could a marijuana stock tick all the boxes?

What Everyone Else In The Sector Is Missing
Cash Flow, Cash Flow, Cash Flow!!!

There is a lot of hype around the marijuana sector.

There should be… because fortunes will be made from the growth that this sector will experience in the coming decade.

This sector has been full of hype, but at the end of the day, what matters is always the same… CASH FLOW.

Don’t let anyone fool you. It is a growing cash flow stream that drives the biggest stock market winners. It doesn’t matter if we are talking about insurance companies, oil producers or technology companies.

The marijuana sector doesn’t have that yet. That lack of cash generating businesses is what is keeping all of the respectable (and BIG) institutional money on the sidelines. And without that institutional money – the upside in these stocks is limited.

Institutional capital does want exposure to the huge opportunity that is marijuana. But the institutions can’t buy stocks based on hype. The institutions need to buy stocks based on financial performance… based on cash generating ability.

There are tens of billions of institutional dollars just waiting to buy marijuana stocks. That money is just waiting for cash generating companies to develop.

This is exactly why this one company, my only marijuana stock, should have a huge 2019.

In the next 12 months I believe that institutional investors will become big buyers of select marijuana stocks.

Why? Cash flow… rapidly growing cash flow.

The marijuana stock I own is already generating free cash flow. Over the next 12 months the company has a clear sight to increasing that cash flow tenfold – that’s 1000%.

There are no hoops to jump through, no wishful thinking here. The company has already made the up-front investments to generate this cash flow ramp and now just needs to carry out a simple business plan – one that has no impediments in front of it, except time.

With every quarterly filing in 2019, I expect the institutional money to see not just growing cash flow, but at a scale that makes sense for Big Money. I’m talking $10 million to possibly $90 million. Everyone has been looking for a free cash flow generating marijuana stock.

And this company is it…

This Company Has Credibility From Top To Bottom

The most important factor in any company is management. When I tell you about management, you’ll ask yourself – how did I not know about this company?

Every single door in the marijuana industry – and in the Tier 1 banks – is open to this CEO.

Everybody wants to be part of his empire, because his name and company brand bring respect and money.

That’s the kind of guy with whom I want to invest. His relationships open doors in ways that no other company can compete with.

And every time the company achieves a milestone, its shares will get rewarded.

This management group put $5 million of their own money into the shares of this company. The CEO gets paid the grand sum of $1/yr.  One dollar – because he owns stock!

The company was structured this way on purpose: they keep G&A costs VERY low so that the company (read:shareholders) can benefit from as much cash flow as possible.

It’s Financially this company is also built upon quality… it’s got a pristine balance sheet. It has a pristine income statement. Who else in this sector already has positive cash flow and will grow 10x in 2019?

As the market learns the names of these key relationships and the opportunities that they are laying the groundwork for… it will be a game-changer for this stock.

What Valuation Does 5 to 10-fold Growth In Cash Flow Gets You….

As 2019 unfolds, I expect investors to be drawn to this low-risk, high growth company.

What I’m talking about here is a cash flowing, rapidly growing, debt free, cash rich, marijuana stock with a trusted management team and high quality recognizable partners.

Can you see where that is going to attract some attention?

As the cash flow ramps up in 2019 this company is going to stand out to institutional investors like a 500 carat diamond sitting on top of a field full of jet black coal.

DON’T  MISS  MY  NEXT  EMAIL!!!

If a company like this happens to interest you – do not miss my next e-mail.

In that e-mail I’ll direct you where I’ve positioned myself ahead of the institutional money that I expect to pour into this stock in 2019.

I will provide for you the name and the ticker of this company – the only marijuana stock that I’m interested in owning.  A company that is all quality and ready to see cash flow explode higher in 2019.

What I’ll tell you specifically in that e-mail is:

1 – Specific details of the core business and how it will see cash flow ramp up 5-10x over the course of 2019

2 – The key relationships that is going to turn this already cash flowing business into a huge player in both the American and international marijuana market

3 – How I arrive at my valuation targets that show this stock being a multi-bagger within 18 months

Everything I’ll tell you – you will be able to verify for yourself through this company’s financial filings.

I’m sure that this company is by a wide margin the must lucrative way to play what is going to be a huge 2019 for the marijuana industry.

Keith Schaefer

Where will energy investors make money in 2019?  I think the answer will surprise you.  Click on the short video below as I outline a couple sub-sectors which should prove fruitful this year–and FIVE stocks within those that I think will do great. A rough transcript is below the video (which is only 3 and a half minutes).  Don’t forget to subscribe to my YouTube channel.

Hi, I’m Keith Schaefer from the Oil and Gas Investments Bulletin. My job is to give my subscribers the best money making ideas in energy.

Today I’ll tell you where I think there is money to be made in 2019 in energy.

If you watched my last video, you’ll know I’m quite neutral on oil prices this year, which is not good news for most oil producers. But there are a couple exceptions to that rule.

There are a couple very large independent producers who generate incredible cash flow with WTI prices in low to mid $50s. They are paying off their large debt at an incredible pace, and just the deleveraging alone will make these stocks go up if oil prices stay in the low to mid $50s. My subscribers got a full report on my favourite just before Christmas.

Then there are two intermediate sized producers who are so profitable – meaning their multi million dollar oil wells pay out so fast – they can generate cash – and I mean so much cash, that companies in other industries would be jealous – that I want to own more of them. Yes there are actually two producers with such incredible economics I can see myself buying more of them in 2019. I can send you those reports risk free if you choose to subscribe.

But that’s it for oil producers. I think small caps stay challenged. I think US oil stocks are quite gassy, and I continue to be a natgas bear due to fast rising US gas production. So I’m not there.

No, I think A Big Theme for 2019 could be midstream, or pipeline related stocks in the US. Here’s why.

First off, everybody hates them, especially the MLPs, the Master Limited Partnerships, a sector that pays out big dividends. But second, they are now living and actually growing within cash flow for the first time in years – maybe ever.

When sentiment is awful and fundamentals are good and improving – that’s an investor’s dream!

After the oil price collapse in 2014, MLPs never recovered. They were trading at high multiples and low yields. But the Market found out these pipeline stocks did have a small amount of price exposure, and a bit of volume exposure as well when prices collapsed… and a lot of debt.

The management teams of these companies are learning their lessons, just like the producers. They are now living within cash flow. And with the huge increase in both oil and natgas production, volumes in the pipelines are growing – which means revenue is growing.

In late 2018, there was a huge drop in oil prices, natgas prices and high yield debt – a perfect trifecta that threw pipeline stocks to the mat. To me, that’s an opportunity. I can now buy some of these midstream stocks at the lowest valuation in years, if not in history, at a time when cash flows are growing and debt is declining.

I’ve got full reports on THREE different US midstream stocks where this is happening right now. I tell people all the time – I have NO idea where the oil price is going; nobody does. But one thing I DO know with absolute certainty is that the US will be increasing production in both oil and natgas in the coming years.

So that, I can invest in – when I KNOW what’s going to happen.

If you want to read the three company reports in this midstream sector, take out a risk-free trial subscription to the Oil and Gas Investments Bulletin today. Just google me, Keith Schaefer, and my website will come up.

Have a Happy New year and thank you for watching.

Click here for monthly access $ 59 a month (no refunds)

Click here for quarterly access $ 149 per quarter (30 days no-questions refund)