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    Stock Report for Cannabis Science Inc. (CBIS)

    Cannabis Science Inc. (CBIS) is in the business of developing pharmaceutical grade medical cannabis (marijuana) products. The Company is working with scientific experts on phytocannabinoid science targeting critical illnesses; adhering to scientific methodologies to develop, produce, and commercialize phytocannabinoid-based pharmaceutical products. In sum, CBIS is dedicated to the creation of cannabis-based medicines, both with and without psychoactive properties, to treat disease and the symptoms of disease, as well as for general health maintenance.

    Share Statistics (05-Mar-12) FY2009 FY2010 % Chg Q32010 Q32011 % Chg
    Symbol CBIS Revenue, $Mn 0.00 0.00 0.00 0.00
    Current price $0.15 Gross marg.
    52wk Range: $0.01-$0.25 Oper. margin -196317.5% -74340.5%
    Avg Vol (3m): n/a Net margin
    Market Cap. 36.29M
    Shares Outstanding 241.92M EPS, $ -0.15 -0.05 -66.7% -0.02 0.00

    Source: Reuters.com, SEC Filings.

    Investment Highlights

    Shares of Cannabis Science (CBIS) advanced nearly 15% to $0.15 in Monday’s trading after the Company on Friday issued market data for its newest over-the-counter products. Over 29 million shares traded hands during the session, versus the 30-day average of 28.82 million. The penny stock has a 52-week range of $0.01 – $0.25.

    Shares of  the medical marijuana company have gained 32.4% in the last five days; 244.0% in the last month; and 81.9% year-to-date.

    CBIS reported that the global anti-aging products market is expected to reach $291.9 billion by 2015, while the U. S. market for anti-aging products for appearance enhancement is expected to reach more than $5 billion by 2015. The Company, citing a new report by Global Industry Analysts, noted that the worldwide cosmeceuticals market stood at $27.2 billion in 2010. The demand for cosmeceutical products is expected to rise 5.8% annually through 2015.

    As stated by CBIS COO Dr. Moe Afaneh, the Company believes its sunscreen and protectant is far superior to others because the company has invested time into understanding what occurs in the body and on the skin, and targeting the cascade of events that occur when people get sunburned. Dr. Afaneh added that CBIS has meticulously targeted key components that lead to sunburn and created its elite formulation so that one instantly feels the skin begin to cool and the pain dissipating.

    Dr. Afaneh also commented on CBIS’s topical skin care products, saying that they help provide relief to various skin conditions such as eczema and other recurring skin irritations. Also, the Company’s anti-aging skin serum, specifically formulated for women, helps rejuvenate and soften the skin, with serum using only natural ingredients including hemp oil extract and many other natural oils and ingredients, he concluded.

    Dr. Afaneh confirmed the newest CBIS brand product line in February, with the Company finalizing negotiations for the manufacturing and national distribution of this new product line.

    Source:

    http://www.cannabisscience.com/news-a-media/press-releases/274-cannabis-science-issues-potential-revenues-and-market-data-for-the-new-cannabis-science-brand-otc-products.html

    Financial Summary

    CBIS had license revenues of $0 and $73,334 for the three and nine month periods ended September 30, 2011, respectively, compared to $0 for both comparative prior year periods. The Company attributed these increases t0 its license deal with Rockbrook signed on August 18, 2010, and the associated recognition of license fees paid by Rockbrook to the Company for the distribution of its products.

    The Company realized a net loss on settlement of liabilities of $873.70K for the three months ended September 30, 2011, an improvement from a net loss of $945.50K reported for the comparable period in 2010.  This decrease was due to the Company issuing more shares for the settlement of less debt and the lower corresponding fair market value of shares issued for settlement. For the nine months ended September 30, 2011, the net loss on settlement of liabilities increased by $822.90K to $3.25 million, compared to $2.42 million for the comparable prior year period. This increase was due to the Company issuing more shares for the settlement of less debt despite the lower corresponding fair market value of shares issued for settlement.

    CBIS’s general and administrative expenses were $463.32K for the three months ended September 30, 2011, down from $1.41 million reported for the three months ended September 30, 2010. The result can be attributed to one-time bonuses for new management consulting agreements signed on July 1, 2010 and increased management and consulting expense from stock issued to consultants for services rendered.

    General and administrative expenses, however, increased by $561.07K to $2.65 million for the nine months ended September 30, 2011, compared to $2.09 million for the nine months ended September 30, 2010. This can be attributed to increased management and consulting expenses, office and laboratory rental expenses.

    Source:

    http://biz.yahoo.com/e/111121/cbis.ob10-q.html

    Financial Strength (05-Mar-12)

    Company

    Industry

    Sector

    S&P 500

    Quick Ratio (MRQ) 3.50 1.50 0.65
    Current Ratio (MRQ) 0.00 4.35 1.85 1.00
    LT Debt to Equity (MRQ) 28.81 27.97 171.80
    Total Debt to Equity (MRQ) 31.91 37.64 224.97
    Interest Coverage (TTM) -333.61 49.09 2.43 26.04

    Source: Reuters.com, SEC Filings.

    Technical Analysis

    Source: http://stockcharts.com

    CBIS is presently near its upper Bollinger Band. This suggests that it is at a high level relative to recent action.

    The MACD for CBIS currently indicates a strong bullish signal for two reasons. First, the MACD is above the signal line, a 9-day moving average. Second, the MACD is above 0, which implies that the underlying moving averages are trending higher.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    Mar05-2012 symbol Share, $ $ Mn 2011 2012 2011 2012
    Bristol-Myers Squibb Co. BMY 32.92 55.54B 16.71 16.97 3.08 3.28
    Medical Marijuana Inc. MJNA 0.07 37.60M n/a n/a n/a n/a
    Cell Therapeutics Inc. CTIC 1.31 240.49M n/a n/a n/a 6.44
    Median       20.29 n/a 3.51 n/a
    Cannabis Science Inc. CBIS 0.15 35.20M n/a n/a n/a n/a

    Source: Thomson Financial

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