GrowGeneration (GRWG) - Get GrowGeneration Corp. Report shares rose Tuesday after the hydroponic and organic garden chain, often traded as a marijuana company, said it had acquired Downriver Hydroponics.
Terms weren't disclosed.
Downriver is the Brownstown, Mich., indoor garden supply center. Downriver Hydro has annual revenue approaching $10 million, Denver-based GrowGeneration said.
Including Downriver, Grow now has 53 stores across 12 states, with seven of those locations in Michigan.
Grow recently traded at $46.26, up 2.04%. It has well more than doubled (up 147%) in the past six months, as gardening flourished during the COVID pandemic.
As for geography, "Michigan's cannabis market is expected to generate $3 billion in revenue over the next three years, making it an ideal place for further investment and expansion," said Darren Lampert, GrowGeneration's CEO.
"We continue to look for best-in-class hydroponics stores in mature and emerging markets, and Downriver Hydro has a strong customer base, as well as an experienced and knowledgeable staff."
Last month, GrowGeneration posted record full-year sales and said it expected to rack up additional strong sales in the first quarter.
It registered 2020 GAAP earnings per share of 11 cents, more than double the 4 cents of the year earlier. Analysts had been expecting 16 cents.
TheStreet.com founder Jim Cramer said in February that GrowGeneration had caught his attention.
TheStreet.com’s Brent Kenwell also analyzed Grow in February, in light of the recent volatility in cannabis stocks. Many investors have been disappointed with marijuana stocks' meager earnings and have sold in bulk.
“GrowGeneration continues to trade pretty well,” Kenwell said. “Despite the volatility over the past few days, shares are still up significantly.”