Revisiting Auxly Cannabis after record Q2 earnings and a 30% stock jump since my previous post

plants don't grow on spreadsheets but some people never learn. glad you held through the noise

bro got downvoted to oblivion on the original post and came back with a massive victory lap after auxly actually delivered on those earnings, which honestly has to feel amazing. finding a small-cap cannabis name actually printing real free cash flow and growing revenue while everyone else in the sector is bleeding cash is super rare, especially when the market completely ignored it at a twenty percent plus fcf yield. q3 being historically the biggest seasonal stretch for weed sales means if they keep compounding and clean up their balance sheet further, that thirty percent jump might literally just be the warm-up act.

Nice, what is your sp target? The stock is retracing a bit, people taking profit ?

The reason why I didn't invest is because i lost a lot of money with $HASH

I'm sure some are taking profits. Its still up 5% on the month too. I'd consider $500mm (CAD) market cap to be a fair price at this exact moment (about 10x Buffet's owner's earnings metric), which is something like $4.85/share. That said, I also think there are a number catalysts that could send it the moon. I believe Auxly is writing the playbook that US operators will eventually look to the moment interstate is allowed.

Credit where it's due: Auxly's operational improvement is real. Q2 revenue grew 18%, adjusted EBITDA grew 24%, and margins improved. The original thesis deserves to be revisited on the fundamentals, not dismissed because it's a cannabis stock.The part I'd revisit is the 20%+ FCF yield.Auxly reported C$13.4M of operating cash flow before working capital changes in Q2, but the actual cash flow statement shows C$2.76M after working capital and roughly C$2.36M after PP&E purchases.For H1, the equivalent FCF calculation is a much stronger C$13.55M, so I wouldn't annualize the weak Q2 in isolation either.There's also a forward looking issue: management expects C$10-12M of capital spending in 2026, versus only C$1.21M of PP&E purchases recorded in H1. Some meaningful investment may still be ahead. And your original C$45M owner earnings estimate against a C$270M market cap implied about a 16.7% yield, before updating the valuation for the subsequent stock appreciation.I think the more useful question is how much normalized annual cash Auxly can generate after working capital needs and the maintenance portion of capex, while separately accounting for growth investments.If that bridge still supports your valuation, it's a stronger thesis than simply annualizing operating cash flow before working capital. The operational progress looks credible; the sustainable owner earnings number is what I'd want to establish next.

This was the first thing I noticed with Q2 numbers and the first thing I researched when the numbers came out. I pulled AR against report and looked into the non-cash working capital changes for Q2 when the numbers, and it's just quarterly variance. 1) All of their receivables accounts were in good standing with only a very tiny (Couple percentage points) outstanding for more than 30 days. 2) Their customers are the provincial boards, not random mom and pop dispensaries. They're going to get paid lol. There is expected investment ahead of $10mm as they are expanding production to fill demand.