Stock Pick

Why the Elixinol (ASX:EXL) share price has been halted today?

Written by

therawinformant

in

A serious woman put her hand out indicating stop

The Elixinol Global Ltd (ASX: EXL) share price has been halted today as the company reported that it would be announcing a potential transaction.

Shares in the small-cap cannabis company have not been trading since the start of today. Consequently, the Elixinol share price remains at 19.5 cents.

What happened to Elixinol

The Elixinol share price will be one to watch in the coming days as its shares begin trading again. According to the release, the trading halt will remain in place until the announcement. Alternatively, when trading commences on March 8. Whatever is earlier.

The potential transaction is yet to be announced. Elixinol has stated that it wasn’t aware of any reason why the halt should not be granted. 

Full year results

Notably, the company recently released its full-year results on February 26. Its shares have since nosedived, shedding around 9%.

Elixinol highlighted its global reset strategy. This has been put in place to stabilise its share price. For reference, the Elixinol share price has dropped an astounding 95.7% since May 2019. According to the company, the strategy has resulted in a strong balance sheet being formed. Ultimately, with lower costs and new growth catalysts. On this note, the cash at hand was $27.7 million at the time of reporting.
 
Furthermore, there was a significant margin improvement in the second half of FY2020. This comes as its business plan continues to shift more towards online and e-commerce. A sector with significant tailwinds.
 
Elixinol CEO Oliver Horn addressed the results saying:
While much of the past 12 months has been challenging for traditional retailers, we made great strides forward in our pursuit of sustainable growth and improved capital efficiency. Our strategy to reduce our cost base and shift the business towards higher margin channels, while bringing new products to market and entering new categories, is starting to show success via an improving bottom-line.
Mr. Horn also claimed the company is in a good position to benefit from the growing consumer trend for hemp wellbeing products. Despite his positive sentiment the market has struggled to make headway, falling 9% since the release.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the Elixinol (ASX:EXL) share price has been halted today? appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/38aKL15

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

More posts