On Friday, September 7th, shares of FSD Pharma Inc. (CSE:HUGE) (OTC:FSDDF) were up roughly 30% following news that Famous Brandz Inc., a subsidiary of High Tide Ventures Inc., was selected as one of ten accessories suppliers to the Ontario Cannabis Retail Corporation.
This rally happened despite FSD Pharma Inc. having nothing to do with Famous Brandz Inc. or High Tide Ventures Inc. other than the fact that FSD’s wholly-owned licensed producer subsidiary, FV Pharma Inc. had entered into a non-binding memorandum of understanding with High Tide dated July 18, 2018 “to supply the Saskatchewan market on a wholesale basis with up to 5,000,000 grams of cannabis products over the next year when available.”
That non-binding memorandum of understanding to supply up to some astronomical figure does not mean that FSD stands to benefit from the selection of Famous Brandz as an accessory supplier. The company’s Friday release even said in the title that it was merely congratulating High Tide Ventures.
On Monday, September 10th, shares of HUGE ripped up another 48% keeping the rally going despite the release of interim financial statements showing 112,242,457 warrants outstanding at a weighted average exercise price of $0.0498 CAD per share.
With an opening price of $0.88 CAD per share this morning, that upcoming dilution at a cost basis of under $0.05 CAD per share is a signal that it might time for bag holders to take profits.
Now, this morning, the company announced the appointment of Dr. Raza Bokhari to its Board of Directors, effective immediately. Alongside that, FSD issued him 40,000,000 stock options dependent on a NASDAQ listing.
This is not a recommendation to buy or sell shares of FSD Pharma Inc., but rather a wake up call to shareholders based on my findings. While the company has been on our top 5 Canadian L.P. Gainers list quite a lot lately, I expect that streak to come to an end today.
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