Thursday , 18 August 2022

Only One of 5 Marijuana Stock Categories Went UP Last Week

The cannabis/marijuana/pot/weed sector, call it what you will, consists of 5 distinct categories, LPs, MSOs, psychedelics, auxiliary (i.e. goods and service suppliers) and major company investors and they each perform quite differently from each other.

By Lorimer Wilson, Founder and Managing Editor of munKNEE.com, Your KEY to making money!

Below are the 5 categories that are tracked by my proprietary indices, the constituents in each index with their low/average/high market capitalizations and low/average/high stock price performances, and each category’s average stock performance over the past week, month-to-date, YTD and from their peaks in 2021:

  1. The Pure-Play Canadian LP Pot Stock Index

    • The Index consists of the 5 largest Canadian Licensed Producers, namely, Aurora (ACB); Canopy Growth (CGC); Cronos (CRON);  Organigram  (OGI) and Tilray (TLRY) which trade for at least US$1/share on the Canadian and/or American stock exchanges and have a market cap in excess of US$400M.
      • The market capitalization of the above stocks range from a low of US$458M (Organigram) to a high of US$2,340.0M (Tilray) with an average of US$1,360M.
      • The stock prices range from a low of US$1.46 (Organigram) to US$5.57 (Canopy) with an average of US$3.68/share as of today.
    •  The Index was DOWN -14.7% for the week ending April 22nd this past week and is now DOWN -26.2% so far in April, DOWN -31.5% YTD and DOWN -88.3% from its peak in February 2021. 
  2. The Pure-Play American MSO Pot Stock Index

    • The Index consists of the 13 largest American Multi-State Operators, namely, Acreage (ACRDF/ACRHF); Ascend Wellness (AAWH); Ayr Wellness (AYRWF); Columbia Care (CCHWF); Cresco (CRLBF); Curaleaf (CURLF); Goodness Growth (GDNSF); Green Thumb (GTBIF); Jushi (JUSHF); Planet 13 (PLNHF); TerrAscend (TRSSF); Trulieve  (TCNNF) and Verano (VRNOF) which trade for at least US$1/share on the Canadian and/or American stock exchanges and have a market cap of at least US$200M.
      • The market capitalization of the above stocks range from a low of US$227M (Goodness Growth) to a high of US$4,580M (Curaleaf) with an average of US$1,466M.
      • The stock prices range from a low of US$1.78 (Goodness Growth) to US$16.80 (Trulieve) with an average of US$6.32/share as of the end of trading on April 22nd.
    • The Index went DOWN -7.2% for the week ending April 22nd, is DOWN -17.7% so far in April and is now DOWN -30.3% YTD and DOWN -67.9% from its peak in February 2021.
  3. The Ancillary Pot Stock Index

    • The Index consists of the 7 largest companies providing goods and services to the cannabis sector, namely, AFC Gamma (AFCG); Forian (FORA); GrowGeneration (GRWG) ; Hydrofarm (HYFM); Innovative Industrial Properties (IIPR); Scotts Miracle-Gro Company  (SMG) and Turning Point Brands (TPB) which trade for at least US$1/share on the Canadian and/or American stock exchanges and have a market cap of at least US$115M.
      • The market capitalization of the above stocks range from a low of US$116.1M (Forian) to a high of US$5,790M (Scotts Miracle-Gro) with an average of US$1,717.6M.
      • The stock prices range from a low of US$3.56 (Forian) to US$155.00 (Innovative) with an average of US$46.87/share as of the end of trading on April 22nd. All but one (Turning Point) are now BELOW their 52-week lows!
    •  The Index went DOWN -8.1% for the week ending April 22nd, and is now DOWN -17.8% so far in April,  DOWN -38.7% YTD and DOWN -59.0% from its peak in 2021. 
  4. The Conservative Pot Stocks Index

    • The Index consists of 6 tobacco, beer and liquor companies that have invested heavily in the cannabis industry, namely, Altria Group (MO); Anheuser-Busch  (BUD); British American Tobacco (BTI); Constellation Brands (STZ); Imperial Brands  (IMBBY) and Molson Coors Brewing Company (TAP).
      • The market capitalization of the above stocks range from a low of US$11.66B (Molson Coors) to a high of US$103.03B (Anheuser-Busch) with an average of US$63.48B.
      • The stock prices range from a low of US$22.05 (Imperial Brands) to US$250.96 (Constellation) with an average of US$80.76/share as of Friday, April 22nd.
      • All 7 constituents pay dividends with yields ranging from just 0.9% for Anheuser Busch to 11.4% for Imperial Brands.
    • The Index went DOWN -0.2% for the week ending April 22nd, but is UP +5.4% so far in April, UP +4.3% YTD but is still DOWN -3.5% from its peak in 2021.
  5. The Pure-Play Psychedelic Compounds-Based Stocks Index 

    • The Index consists of 6 psychedelic and marijuana (THC) drug companies in the clinical stages of research and development of treatments for a wide variety of mental illnesses, namely, Allied (ALID); Cybin (CYBN); Field Trip (FTRP); Numinus  (NUMIF); Seelos (SEEL) and Zynerba (ZYNE) which trade on the Canadian and/or American stock exchanges and have market caps of at least US$70M.
      • The market capitalization of the above stocks range from a low of US$63.3M (Zynerba) to a high of US$118.6M (Cybin) with an average of US$81.7M.
      • The stock prices range from a low of US$0.37 (Numinus) to US$1.49 (Zynerba’s 52-week low) with an average of US$091/share as of the market close on Friday, April 22nd.
    • The Index went DOWN -9.6% for the week ending April 22nd, and is now DOWN -16.3% so far in April, DOWN -47.5% YTD and DOWN -80.8% from its peak in 2021. 

4 other companies with market caps in excess of US$400M are followed but are not included in the Index due to their size, namely, Atai (ATAI); Compass Pathways (CMPS); GH Resources (GHRS) and Mind Medicine (MNMD).

  • The market capitalization of the above stocks range from a low of US$368M (Mind Medicine) to a high of US$884M (GH Resources) with an average of US$637.7M.
    • The stock prices range from a low of US$0.87 (Mind Medicine) to US$17.11 (GH Resources) with an average of US$8.84/share as of the market close 0n Friday, April 22nd.
    •  These 4 stocks went DOWN -7.7% for the week ending April 22nd, and is noe DOWN -5.7% so far in April, DOWN -35.0% YTD and DOWN -65.1% from its peak in 2021. 

In Summary

Below is a summary as to how the 5 cannabis categories performef for the week ending April 22nd, in descending order:

  1. The Conservative Pot Stocks Index
    • went DOWN -0.2% this week, and is now
    • UP +5.4% so far in April and
    • UP +4.3% YTD and is now
    • DOWN -3.3% from its peak in 2021.
  2. The Pure-Play American MSO Pot Stock Index
    • went DOWN -7.2% this week, and is now
    • DOWN -17.7% so far in April,
    • DOWN -30.3% YTD and
    • DOWN -67.9% from its peak in February 2021.
  3. The Ancillary Pot Stock Index
    • went DOWN -8.1% this week, and is now
    • DOWN -17.8% so far in April,
    • DOWN -38.7% YTD and
    • DOWN -59.0% from its peak in 2021.
  4. The Pure-Play Psychedelic Compounds-Based Stocks Index 
    • went DOWN -9.6% this week, and is now
    • DOWN -16.3% so far in April,
    • DOWN -47.5% YTD and
    • DOWN -80.8% from its peak in 2021.
  5. The Pure-Play Canadian LP Pot Stock Index
    • went DOWN -14.7% this week, and is now
    • DOWN -26.2% so far in April,
    • DOWN -31.5% YTD and
    • DOWN -88.3% from its peak in February 2021.

Having the cannabis sector analyzed in such a fashion highlights the disparity between the 5 categories and, I hope, provides you with the information necessary to decide which, if any, category to invest in.