What is the company's guidance on capital expenditures and potential M&A activity for the rest of 2025?

Guidance on Cap‑Ex and M&A

In its Q2 2025 earnings release, IM Cannabis Corp. reaffirmed that it will keep capital‑expenditure (Cap‑Ex) spending in line with the $35 million–$45 million range it set for the full‑year 2025. Management highlighted that the current pipeline of expansion projects—including the new Israeli production facility and the planned upgrade of its Canadian indoor farms—can be funded largely from operating cash flow, with no material increase to the annual budget expected. On the M&A front, the company reiterated its “selective‑acquisition” strategy: it will continue to explore strategic, synergistic acquisitions that can accelerate geographic expansion and product‑line diversification, but it does not foresee any material, cash‑intensive deals that would materially shift the 2025 capital budget. Any potential transaction will be assessed on a case‑by‑case basis and is expected to be accretion‑neutral to earnings.

Trading Implications

The firm’s disciplined Cap‑Ex stance, combined with a cautious but open‑door M&A outlook, supports a stable cash‑flow profile and mitigates dilution risk—factors that can underpin a neutral‑to‑bullish bias on IMCC. Technically, the stock has been testing the 20‑day EMA around $2.85 after a modest rally post‑earnings; a break above the $3.00 resistance with volume would suggest the market is pricing in successful execution of the stated Cap‑Ex plan and potential accretive deals. Conversely, a failure to hold the $2.80–$2.85 support could signal concerns over execution and may pressure the stock toward the lower 50‑day moving average (~$2.60). Actionable recommendation: consider entering a small‑size long position on pull‑backs to $2.70–$2.78 with a stop just below $2.60, targeting the $3.00 resistance as the primary upside catalyst, while monitoring any M&A‑related news releases for potential upside catalysts.