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Avant Brands Inc (TSE:AVNT)
:AVNT

Avant Brands (AVNT) AI Stock Analysis

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Avant Brands

(OTC:AVNT)

Rating:48Neutral
Price Target:
C$0.50
▼(-35.06%Downside)
Avant Brands faces significant financial challenges with negative margins and operational inefficiencies being major concerns. Technical analysis indicates bearish trends. However, recent corporate events, including international expansion and revenue growth, provide a positive outlook.

Avant Brands (AVNT) vs. iShares MSCI Canada ETF (EWC)

Avant Brands Business Overview & Revenue Model

Company DescriptionAvant Brands (AVNT) is a leading Canadian cannabis company that specializes in the cultivation, production, and distribution of premium cannabis products. The company operates in the legal cannabis sector, focusing on high-quality, hand-crafted cannabis strains and products. With a commitment to innovation and excellence, Avant Brands offers a diverse range of products, including dried flower, pre-rolls, and cannabis extracts, catering to both medical and recreational markets.
How the Company Makes MoneyAvant Brands makes money through the cultivation and sale of premium cannabis products. The company's revenue model is centered around its vertically integrated operations, which allow it to control the production process from seed to sale. Key revenue streams include wholesale distribution to licensed cannabis retailers and direct-to-consumer sales through its own branded products. Avant Brands also leverages strategic partnerships and licensing agreements to expand its market reach and enhance its product offerings. The company's focus on high-quality, craft cannabis products allows it to command premium pricing, contributing to its earnings.

Avant Brands Earnings Call Summary

Earnings Call Date:Apr 11, 2025
(Q1-2024)
|
% Change Since: -20.62%|
Next Earnings Date:Jul 09, 2025
Earnings Call Sentiment Positive
Avant Brands reported strong financial performance with record revenue and growth, positive cash flow, and international market expansion despite competitive challenges in the Canadian market.
Q1-2024 Updates
Positive Updates
Record Revenue and Growth
Avant Brands exceeded guidance with gross revenue of $8.9 million and net revenue increased by 15% year-over-year to a record $8.1 million. Gross margin reached a record $4.7 million with a healthy 58% margin overall.
Positive Cash Flow and EBITDA
Generated positive cash flow at a record $3.8 million and achieved a 47% adjusted EBITDA margin of net revenue. Avant has achieved positive EBITDA for 6 of the past 7 quarters.
International Market Expansion
Secured 5 new cannabis export agreements, bringing the total to 12 across Israel, Australia, and Germany. Export remains the fastest-growing channel.
Strong Export Pricing
Maintained strong export selling prices at $4.30 a gram, with the BLK MKT brand maintaining its premium price point.
Private Placement for Growth
Announced a private placement to secure up to $3.89 million in gross proceeds to support working capital needs.
Negative Updates
Competitive Canadian Market
The Canadian recreational market, especially in Ontario, remains highly competitive, impacting domestic performance.
Company Guidance
During the Avant Brands Q1 2024 earnings call, the company disclosed a robust financial performance, surpassing their guidance with gross revenue reaching $8.9 million, against an anticipated $8.2 to $8.8 million. Net revenue climbed by 15% year-over-year, hitting a record $8.1 million. The gross margin was at a healthy 58%, with Canadian recreational sales at 63% and exports achieving an impressive 74% margin. The firm generated a record positive cash flow of $3.8 million and reported an adjusted EBITDA of the same amount, reflecting a 47% margin. Avant also announced a private placement to secure up to $3.89 million to bolster working capital, with a strategic investor contributing a lead order of $600,000. Additionally, the company’s export channel expanded significantly with five new agreements, solidifying its presence in international markets and offsetting domestic challenges.

Avant Brands Financial Statement Overview

Summary
Avant Brands faces challenges in profitability and financial stability, with negative profit margins and operational inefficiencies despite revenue growth. The balance sheet shows moderate stability, but negative equity trends and inconsistent cash flows pose risks. Improvement in cost management and operational efficiency is needed.
Income Statement
35
Negative
Avant Brands has experienced revenue growth from 2020 to the TTM period, but the company struggles with negative profit margins. The gross profit margin is negative, reflecting cost challenges. Net profit margin is also significantly negative due to high operating expenses relative to revenue. The EBITDA and EBIT margins are deeply negative as well, indicating operational inefficiencies.
Balance Sheet
50
Neutral
The balance sheet shows a moderate debt-to-equity ratio over time, with equity covering liabilities, indicating some stability. However, the negative trajectory in stockholders' equity and total assets highlights potential financial strain. Return on equity is negative due to ongoing net losses, raising concerns about future profitability.
Cash Flow
40
Negative
Avant Brands shows a fluctuating cash flow situation. The operating cash flow to net income ratio is positive, suggesting some conversion efficiency, but free cash flow remains limited and inconsistent. Free cash flow growth has been erratic, highlighting challenges in generating consistent cash from operations.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue36.33M35.80M26.34M20.15M9.50M7.91M
Gross Profit-2.14M-1.68M12.43M3.91M1.90M6.15M
EBITDA-17.26M-19.45M4.84M-1.89M-9.65M-5.07M
Net Income-20.72M-22.55M-5.07M-7.54M-11.23M-10.17M
Balance Sheet
Total Assets56.35M59.47M82.55M67.03M50.57M40.80M
Cash, Cash Equivalents and Short-Term Investments997.00K1.74M794.00K6.78M14.49M625.00K
Total Debt16.04M17.01M18.70M3.01M623.00K7.50M
Total Liabilities24.38M26.62M33.22M18.79M2.70M12.38M
Stockholders Equity31.97M32.85M49.33M43.92M47.87M28.42M
Cash Flow
Free Cash Flow321.00K401.00K1.85M-4.90M-6.22M-1.12M
Operating Cash Flow429.00K507.00K5.41M-3.46M-5.62M-357.00K
Investing Cash Flow-89.00K-78.00K-7.03M-3.10M-1.65M-1.38M
Financing Cash Flow-88.00K539.00K-4.38M-993.00K20.96M393.00K

Avant Brands Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price0.77
Price Trends
50DMA
0.83
Negative
100DMA
0.97
Negative
200DMA
0.91
Negative
Market Momentum
MACD
-0.02
Negative
RSI
49.25
Neutral
STOCH
77.30
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:AVNT, the sentiment is Neutral. The current price of 0.77 is above the 20-day moving average (MA) of 0.76, below the 50-day MA of 0.83, and below the 200-day MA of 0.91, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 49.25 is Neutral, neither overbought nor oversold. The STOCH value of 77.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:AVNT.

Avant Brands Peers Comparison

Overall Rating
UnderperformOutperform
Sector (46)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSDHB
60
Neutral
C$6.41M181.82-3.45%4.04%80.24%
TSCLC
58
Neutral
C$12.39M6.829.27%15.54%
51
Neutral
$9.13M-63.75%9.34%69.69%
48
Neutral
C$8.55M-51.80%32.63%-90.15%
46
Neutral
C$194.28M-4.22-8.60%2.64%13.54%-1.44%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:AVNT
Avant Brands
0.78
-1.32
-62.86%
TSE:DHB
Delivra Health Brands
0.22
-0.08
-26.67%
IMCC
IM Cannabis Corp
2.96
0.83
38.97%
TSE:CLC
Christina Lake Cannabis
0.05
<0.01
28.57%

Avant Brands Corporate Events

Product-Related AnnouncementsBusiness Operations and Strategy
Avant Brands Expands Global Reach with New Supply Agreements and Product Launches
Positive
Jun 23, 2025

Avant Brands Inc. has announced strategic international supply agreements to export up to 2,000 kilograms per year of GACP-certified, non-irradiated dried flower to the European medical cannabis market, enhancing its global market presence. Additionally, Avant is expanding its product offerings in Canada with over 30 new SKU listings in Ontario and B.C., introducing innovative packaging and products, and relaunching its medical division to better serve Canadian patients and veterans, marking a pivotal moment in its growth trajectory.

Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy
Avant Brands Inc. Announces Key Outcomes from 2025 Annual General Meeting
Neutral
May 31, 2025

Avant Brands Inc. held its 2025 Annual General Meeting, where 16.19% of its common shares were represented. Key outcomes included the election of six directors, re-appointment of Ernst & Young LLP as auditors, and approval of amendments to the company’s deferred share unit and long-term incentive plans. Additionally, the repricing of certain warrants and convertible debentures was approved, reflecting strategic adjustments to enhance shareholder value and operational flexibility.

Private Placements and FinancingShareholder MeetingsBusiness Operations and Strategy
Avant Brands Announces Shareholder Meeting and Repricing Amendments
Neutral
Apr 22, 2025

Avant Brands Inc. has announced its upcoming annual general and special meeting of shareholders, scheduled for May 30, 2025. The meeting will address several key business items, including the approval of repricing amendments to the exercise price of certain warrants and the conversion price of debentures, which were previously issued in a private placement. These amendments, aimed at adjusting the financial terms of the debentures and warrants, are subject to shareholder and Toronto Stock Exchange approval. This move could potentially impact Avant’s financial strategy and market positioning, offering more favorable terms to stakeholders involved in these financial instruments.

Business Operations and StrategyFinancial Disclosures
Avant Brands Reports Strong Q1 2025 Financial Results Amid International Growth
Positive
Apr 11, 2025

Avant Brands reported strong financial results for Q1 2025, with significant increases in gross and net revenue, driven by robust international demand for its premium cannabis products. The company achieved a 41% increase in export wholesale revenue, particularly in markets like Australia, Germany, and Israel. Despite a decline in recreational and domestic wholesale revenue due to strategic realignment, Avant continues to focus on scaling its global footprint and delivering sustainable long-term value.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 24, 2025