Stock markets posed a recovery in July, however that was short lived. The speculative end was hardest hit, Cannabis or Marijuana stocks were especially hit hard. This isa pattern with short covering and FOMO buying when a hint of legalization sweeps the US. The result is heavy overhead supply and more secondary issuance for loss making names. ‘Pot stocks’ broke a long losing streak in July of 17 straight months down with a rally of 4.3%, that was merely a quick bong hit.
The Global Cannabis Stock Index fell 1.3% in August. Matters worsened in September, it posted a new all-time closing low on 9/30 at 11.26 and ended the month down 25.9%.
There has been no respite for the weed sector, however the stronger names had been showing some resilience. September that all went away when the strongest names all fell.
- Innovative Industrial Properties (NYSE: IIPR): -3.5%, – 19.5% during Q3 and down 66.3% year-to-date.
- Chicago Atlantic Real Estate Finance (NASDAQ: REFI): -5.6%, – 4.3% during Q3 and down 13.5% year-to-date.
- Cronos Group (NASDAQ: CRON) (TSX: CRON): -7.5%, unchanged during Q3 and down 28.1% year-to-date
- Turning Point Brands (NYSE: TPB): -9.0%, -21.7% during Q3 and down 43.8% year-to-date
Familiar names in the 4 weakest stocks, in September all down by at least 40% for the month. Leafly was the biggest loser for the second straight month. It has dropped 93.2% since the end of 2021. LFLY has been crushed on two fronts, it was a SPAC and its a Cannabis name.
- Leafly (NASDAQ: LFLY): -57.0%, -84.9% during Q3 and down 93.2% year-to-date
- Ayr Wellness (OTC: AYRWF) (CSE: AYR.A): -52.2% during Q3 and down 84.4% year-to-date
- Hydrofarm (NASDAQ: HYFM): -44.3% during Q3 and down 93.2% year-to-date
- Trulieve (OTC: TCNNF) (CSE: TRUL): 43.9% during Q3 and down 67.3% year-to-date
The index Expands to 28 members in Q4.
Leaving the index:
- CEA Industries (NASDAQ: CEAD)
- Leafly (NASDAQ: LFLY)
Note companies that are dual listed in Canada were required to have average daily U.S. trading value in excess of $500K, but this is now $400K.
Joining the index for first time:
- BYND Cannasoft Enterprises (NASDAQ: BCAN) (CSE: BYND)
- Hempacco (NASDAQ: HPCO) and recent IPO
Returning the index
- Columbia Care (OTC: CCHWF) (CSE: CCHW) (NEO: CCHW)
- SND Inc. (NASDAQ: SNDL).
About New Cannabis Ventures
New Cannabis Ventures maintains seven proprietary indices designed to help investors monitor the publicly traded cannabis stocks, including the Global Cannabis Stock Index as well as the Canadian Cannabis LP Index and its three sub-indices. The sixth index, the American Cannabis Operator Index, was launched at the end of October 2018 and tracks the leading cultivators, processors and retailers of cannabis in the United States.
More recently, they introduced the Ancillary Cannabis Index at the end of March 2021, reflecting the increasing number of publicly traded companies providing goods or services to cannabis operators.
Source: New Cannabis Ventures
From The TradersCommunity Research Desk