Reefer madness blasts pot machine maker's stock sky high

Management: 'Whoa, dude, chill out'


The management of marijuana dispensing machine manufacturer Medbox has asked investors to chill out and get a grip after the company's stock suddenly rose 3,000 per cent to over $215.

"While we are pleased by the share attention, Medbox shares have traded between $2.75 and $3.45 over the past several months," said CEO Bruce Bedrick in a statement. "our fundamentals and market potential are improving, but we temper investor expectations at present price points."

As every medical marijuana users knows, what goes up must come down, and Medbox stock has fallen back to around $100 a share, still up 300 per cent on the week and giving the company a market capitalization of $2.26bn. Certainly the value of employees' shares will float them into a blissed-out weekend.

The cause for this sudden burst of stock euphoria wasn't investors hitting a particularly good strain of Purple Kush, but rather the decision by the states of Colorado and Washington to legalize the possession and use of America's second most valuable cash crop, the demon weed.

Medbox has built a growing business supplying specialized marijuana vending machines to those US states and other countries that have legalized the use of medical pot. Its fingerprint-scanning doobie dispensers make sure that legitimate purchasers aren't left waiting for their man.

Medbox marijuana dispensing machine

How long before this gets hacked?

To be fair, the company also sells a lot of these machines to hospitals and prison dispensaries, but that business could potentially be dwarfed by the profit to be had as everyone in Colorado gets Rocky Mountain High (one of two official state songs incidentally – just sayin'.)

But investors might find that they get less of a profit than they bargained for in the long run. There's plenty of evidence from countries that have taken a more scientific approach to drug policy that legalizing the stuff actually cuts demand as time goes by.

The Netherlands is the most famous example, and the products of this relaxed attitude to cannabis consumption are seen strewn across the coffee shops and canals of Amsterdam 365 days a year. But they're almost all tourists – only 5.4 per cent of locals smoke the drug annually. That rate has been declining steadily, in part because its use is socially stigmatized in most Dutch homes and offices.

Meanwhile in Portugal, which quietly made use of almost all drugs a civil rather than a criminal matter in 2001, an estimated 3.3 per cent of locals spark up a fattie on an annual basis, compared to 10.6 per cent in next-door Spain. Long-term spliffage use has also been falling steady there, too.

It's unclear as yet if the decision by US voters to take a more open-minded view towards drugs will be allowed by the Federal government, but some are predicting an gold rush – Acapulco or otherwise. No doubt there are going to be legal challenges to the decision, but there's a limit to what the Federal government can practically do given its manpower, since it relies so heavily on local police cooperation.

"The voters have spoken and we have to respect their will," Colorado Govenor Hickenlooper said after the population voted for legalization. "This will be a complicated process, but we intend to follow through. That said," he added, "federal law still says marijuana is an illegal drug, so don't break out the Cheetos or Goldfish too quickly."

There is certainly going to be a massive market to address. In Colorado's capital city of Denver there are currently more medical marijuana dispensaries than branches of Starbucks, and the mood of the US in general seems to be moving towards a scenario that Medbox is nicely positioned to take advantage of.

Whatever the long-term outlook, company founder Vincent Mehdizadeh isn't going to let things get too heavy, or be a bread-head over getting flush with funds. He's said those who started up the company will be sharing the wealth.

"We will take steps to attempt to avoid a roller-coaster syndrome, with the stock rising and falling in dramatic fashion," he said. "We are in discussions with our attorneys to determine if we can reward our early investors who believe in our company, by giving them company-owned shares should the price they bought at fall significantly. That's what classy companies do." ®


Other stories you might like

  • IBM settles age discrimination case that sought top execs' emails
    Just days after being ordered to provide messages, Big Blue opts out of public trial

    Less than a week after IBM was ordered in an age discrimination lawsuit to produce internal emails in which its former CEO and former SVP of human resources discuss reducing the number of older workers, the IT giant chose to settle the case for an undisclosed sum rather than proceed to trial next month.

    The order, issued on June 9, in Schenfeld v. IBM, describes Exhibit 10, which "contains emails that discuss the effort taken by IBM to increase the number of 'millennial' employees."

    Plaintiff Eugene Schenfeld, who worked as an IBM research scientist when current CEO Arvind Krishna ran IBM's research group, sued IBM for age discrimination in November, 2018. His claim is one of many that followed a March 2018 report by ProPublica and Mother Jones about a concerted effort to de-age IBM and a 2020 finding by the US Equal Employment Opportunity Commission (EEOC) that IBM executives had directed managers to get rid of older workers to make room for younger ones.

    Continue reading
  • FTC urged to probe Apple, Google for enabling ‘intense system of surveillance’
    Ad tracking poses a privacy and security risk in post-Roe America, lawmakers warn

    Democrat lawmakers want the FTC to investigate Apple and Google's online ad trackers, which they say amount to unfair and deceptive business practices and pose a privacy and security risk to people using the tech giants' mobile devices.

    US Senators Ron Wyden (D-OR), Elizabeth Warren (D-MA), and Cory Booker (D-NJ) and House Representative Sara Jacobs (D-CA) requested on Friday that the watchdog launch a probe into Apple and Google, hours before the US Supreme Court overturned Roe v. Wade, clearing the way for individual states to ban access to abortions. 

    In the days leading up to the court's action, some of these same lawmakers had also introduced data privacy bills, including a proposal that would make it illegal for data brokers to sell sensitive location and health information of individuals' medical treatment.

    Continue reading
  • Behold this drone-dropping rifle with two-mile range
    Confuses rather than destroys unmanned aerials to better bring back intel, says Ukrainian designer

    What's said to be a Ukrainian-made long-range anti-drone rifle is one of the latest weapons to emerge from Russia's ongoing invasion of its neighbor.

    The Antidron KVS G-6 is manufactured by Kvertus Technology, in the western Ukraine region of Ivano-Frankivsk, whose capital of the same name has twice been subjected to Russian bombings during the war. Like other drone-dropping equipment, we're told it uses radio signals to interrupt control, remotely disabling them, and it reportedly has an impressive 3.5 km (2.17 miles) range.

    "We are not damaging the drone. With communication lost, it just loses coordination and doesn't know where to go. The drone lands where it is jammed, or can be carried away by the wind because it's uncontrollable,"  Kvertus' director of technology Yaroslav Filimonov said. Because the downed drones are unharmed, they give Ukrainian soldiers recovering them a wealth of potential intelligence, he added.  

    Continue reading
  • Alcatel-Lucent Enterprise adds Wi-Fi 6E to 'premium' access points
    Company claims standard will improve performance in dense environments

    Alcatel-Lucent Enterprise is the latest networking outfit to add Wi-Fi 6E capability to its hardware, opening up access to the less congested 6GHz spectrum for business users.

    The France-based company just revealed the OmniAccess Stellar 14xx series of wireless access points, which are set for availability from this September. Alcatel-Lucent Enterprise said its first Wi-Fi 6E device will be a high-end "premium" Access Point and will be followed by a mid-range product by the end of the year.

    Wi-Fi 6E is compatible with the Wi-Fi 6 standard, but adds the ability to use channels in the 6GHz portion of the spectrum, a feature that will be built into the upcoming Wi-Fi 7 standard from the start. This enables users to reduce network contention, or so the argument goes, as the 6GHz portion of the spectrum is less congested with other traffic than the existing 2.4GHz and 5GHz frequencies used for Wi-Fi access.

    Continue reading
  • Will Lenovo ever think beyond hardware?
    Then again, why develop your own software à la HPE GreenLake when you can use someone else's?

    Analysis Lenovo fancies its TruScale anything-as-a-service (XaaS) platform as a more flexible competitor to HPE GreenLake or Dell Apex. Unlike its rivals, Lenovo doesn't believe it needs to mimic all aspects of the cloud to be successful.

    While subscription services are nothing new for Lenovo, the company only recently consolidated its offerings into a unified XaaS service called TruScale.

    On the surface TruScale ticks most of the XaaS boxes — cloud-like consumption model, subscription pricing — and it works just like you'd expect. Sign up for a certain amount of compute capacity and a short time later a rack full of pre-plumbed compute, storage, and network boxes are delivered to your place of choosing, whether that's a private datacenter, colo, or edge location.

    Continue reading
  • Intel is running rings around AMD and Arm at the edge
    What will it take to loosen the x86 giant's edge stranglehold?

    Analysis Supermicro launched a wave of edge appliances using Intel's newly refreshed Xeon-D processors last week. The launch itself was nothing to write home about, but a thought occurred: with all the hype surrounding the outer reaches of computing that we call the edge, you'd think there would be more competition from chipmakers in this arena.

    So where are all the AMD and Arm-based edge appliances?

    A glance through the catalogs of the major OEMs – Dell, HPE, Lenovo, Inspur, Supermicro – returned plenty of results for AMD servers, but few, if any, validated for edge deployments. In fact, Supermicro was the only one of the five vendors that even offered an AMD-based edge appliance – which used an ageing Epyc processor. Hardly a great showing from AMD. Meanwhile, just one appliance from Inspur used an Arm-based chip from Nvidia.

    Continue reading
  • NASA's Psyche mission: 2022 launch is off after software arrives late
    Launch window slides into 2023 or 2024 for asteroid-probing project

    Sadly for NASA's mission to take samples from the asteroid Psyche, software problems mean the spacecraft is going to miss its 2022 launch window.

    The US space agency made the announcement on Friday: "Due to the late delivery of the spacecraft's flight software and testing equipment, NASA does not have sufficient time to complete the testing needed ahead of its remaining launch period this year, which ends on October 11."

    While it appears the software and testbeds are now working, there just isn't enough time to get everything done before a SpaceX Falcon Heavy sends the spacecraft to study a metallic-rich asteroid of the same name.

    Continue reading
  • Rise in Taiwanese energy prices may hit global chip production
    National provider considering cost increase of 8%, which could be passed on to tech customers

    Taiwan's state-owned energy company is looking to raise prices for industrial users, a move likely to impact chipmakers such as TSMC, which may well have a knock-on effect on the semiconductor supply chain.

    According to Bloomberg, the Taiwan Power Company, which produces electricity for the island nation, has proposed increasing electricity costs by at least 8 percent for industrial users, the first increase in four years.

    The power company has itself been hit by the rising costs of fuel, including the imported coal and natural gas it uses to generate electricity. At the same time, the country is experiencing record demand for power because of increasing industrial requirements and because of high temperatures driving the use of air conditioning, as reported by the local Taipei Times.

    Continue reading

Biting the hand that feeds IT © 1998–2022