Why the Althea (ASX:AGH) share price is charging higher today

This cannabis company is finishing the week on a high…
The post Why the Althea (ASX:AGH) share price is charging higher today appeared first on The Motley Fool Australia. –

The Althea Group Holdings Ltd (ASX: AGH) share price is on course to end the week on a positive note.

In morning trade, the cannabis company’s shares are up 4% to 36.5 cents.

Why is the Althea share price climbing?

Investors have been bidding the Althea share price higher today following the release of a contract update.

According to the release, the company’s Canadian subsidiary, Peak Processing Solutions, has signed a manufacturing agreement with Delshen Therapeutics Corp. It is a wholly owned subsidiary of 48North Cannabis Corp, which is a Canadian cannabis licensed operator and brand marketer.

The release explains that under the agreement, Peak Processing Solutions will manufacture four products for 48North’s Latitude brand. The four products are a CBD body lotion, a 1:1 THC/CBD body lotion, CBD bath salts, and a 1:1 THC/CBD bath salts.

Management notes that the 1:1 bath salt product is already on the market, performing strongly and the only item of its kind currently available.

What is the contract worth to Althea?

The two-year, non-exclusive, agreement includes minimum order quantities with a combined value of approximately C$1.25 million.

These minimum order quantities, which operate on a per product basis, are required to be purchased over a period of 12 months from the date the first purchase order for each product is accepted by Peak Processing Solutions.

Althea’s CEO, Joshua Fegan, said: “This agreement with 48North is once again recognition that Peak is becoming a major player in the Canadian legal cannabis market. The opportunity to supply the well-known Latitude brand will enable the team at Peak to demonstrate their ability to produce fantastic topical and bath products, which consumers will love.”

“In addition to this latest 48North agreement, Peak continues to make great progress with more and more of our client’s products getting picked-up by the provincial distributors and hitting dispensary shelves. After receiving our Health Canada license in September 2020, Peak is expected to become EBITDA positive by the end of 2021,” he added.

The post Why the Althea (ASX:AGH) share price is charging higher today appeared first on The Motley Fool Australia.

Should you invest $1,000 in Althea right now?

Before you consider Althea, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Althea wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

Blazing it? How the top ASX cannabis shares performed in FY21

Here’s why the Althea (ASX:AGH) share price is racing higher today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!