Terra Tech has developed an exceptionally focused strategy for vertically integrating within the fragmented controlled environment agricultural technologies space. With an aggressive attitude to partnerships and M&A, the company is looking to grow an already strong footprint comprised of the commercial manufacturing side of the business and their wholly-owned subsidiary GrowOp Technology’s highly-visible retail brand presence. The end goal for TRTC is to become a completely integrated structure that handles everything from equipment and design, to agricultural production and product distribution.
Terra Tech is steadfastly committed to transforming the way we grow, designing offerings around both the business-to-business supplier dynamics of various commercial indoor cultivation operations and the broader retail market. The kind of localized, environmentally sustainable food production the company’s hydroponic/aeroponic solutions represent is an intriguing market for investors to look at, with sales in the disorganized specialty hydroponic retail space alone estimated at $1.2B last year. TRTC works with companies large and small to bring them the best cutting-edge hydroponic/aeroponic automated dosing-enabled architectures, complete with next-gen digital atmosphere/environmental controls, CO2 regulators, and lighting.
The recent announcement of a major deal with New Jersey-based Edible Farms (a division of Naturally Beautiful Plant Products, with over $2M in current annual revenues), firmly cements TRTC’s commercial agribusiness model. Given current gross revenue projections, the agreement between the two companies to jointly construct/operate up to 10 acres of commercial hydroponic greenhouse infrastructure on the 116-acre farm in Belvidere will rake in another $7M in annual revenues from just the first 2.5 acre facility. The future of such developments is really something to consider when you realize that almost half of all fresh retail tomatoes sold in U.S. stores today are already greenhouse produced.
The resulting 51% ownership position obtained by TRTC in the deal and the strategic position created in this key domestic market with established brand Edible Farms has tremendous shareholder upside. There are over 12k grocery retailers within a six-hour distribution window of the facility and Edible has calculated the potential local market opportunity to be in the neighborhood of $500M, a figure reinforced by increasingly strong demand for locally grown produce. This deal with Edible will really allow the strong competencies in component and overall systems design possessed by TRTC to shine through, and the agreement between the two companies will also help promote brand expansion throughout the region.
Stop for a second and think about how attractive the benefits of localized hydroponic infrastructure are, from getting rid of the need for pesticides/herbicides, to a 95% reduction in water consumption, and the ability to grow year-round, all while the distribution costs are sharply reduced or eliminated out rightly (why ship it in when you can grow it in a warehouse nearby). As attractive as the profitability of high-end hydroponic commercial produce is, President and CEO of TRTC, Derek Peterson, actually left the hectic world of being a Senior VP at Morgan Stanley Smith Barney, overseeing assets in the $100M category, to revolutionize Terra’s other market focus, indoor agricultural systems for medical cannabis.
With medical cannabis legal in 17 states and DC (11 pending), and all reasonable estimates of the total size of the national market coming in north of $100B, it is very clear that TRTC’s ability to create a one-stop-shop solution for the needs of just about any size grower can create a low-risk access point for investors within a booming sector. Fielding a growing product mix currently over 80 SKU’s (and headed for over 100), the company’s ability to deliver full-scale systems, as well as individual components that network easily, is quickly winning over retailers and growers alike. The potentially huge swathe of retail territory (over 2,400 target brick and mortar retailers identified) and the proven e-commerce visibility needed for driving organic growth, available via the company’s GrowOp, eGrow, GoodEarthHydro, and BestBuyHydro portals, collectively
represent a consumer pipeline that could alone sustain the company’s growth for years to come as the medical cannabis market continues to swell. The company has also received a great deal of highly influential press coverage, further solidifying overall identity in key demographics.
GrowOp’s intelligent approach to providing optimized nutrients, ducting and carbon filtration, environmental controllers/timers, HID/LED lighting (including Floros super HPS lamps), reflectors/ballasts, and even their portable hydroponic tents has really struck a chord with growers. The company’s commitment to pushing the design envelope in the field and something which very clearly shows the underlying systems architecture know how, is their portable hydroponic grow trailer designs, which are offered as a complete seed-to-harvest production platform. It is the bold vision inherent in such well-executed concepts that stands to lead TRTC towards their goal of consolidating a large portion of the relevant market space and vertically integrating under their model.
Top of the line technology offerings designed to make the grower’s job painless will continue to set the company apart, like their most recently launched series of environmental controllers/timers, ranging from the Chrono timers up to the flagship ATMOS-D1, a deluxe digital atmosphere controller with one of the best sensor packages on the market today. The investment needed to farm indoors in vertically spaced, tightly controlled conditions is being made an increasingly affordable possibility thanks to TRTC, and the ease of implementation is sped along by dedicated customer service personnel who work directly with customers to ensure the proper solution set is achieved for their specific requirements. That personal touch and an aggressive M&A/partnering attitude is set to serve shareholders well as Terra continues to drive forward.
For more information on Terra Tech, please visit the company’s website at: www.TerraTechCorp.com
About QualityStocks
QualityStocks is committed to connecting subscribers with companies that have huge potential to succeed in the short and long-term future. We offer several ways for investors to learn more about investing in these companies as well as find and evaluate them.
Sign up for “The QualityStocks Daily Newsletter” at www.QualityStocks.net
The Quality Stocks Daily Blog http://blog.qualitystocks.net
The Quality Stocks Daily Videos http://videocharts.qualitystocks.net
The Quality Stocks “Ones to Watch” http://gotstocks.qualitystocks.net
Please see disclaimer on the QualityStocks website: http://disclaimer.qualitystocks.net
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment