Cannabis Stocks Only in the Second Inning of Growth

Bottom Line: Grizzle conducted a deep dive into the cannabis capital markets and found that the future earnings of the North American cannabis industry can support stock value 5 times higher than where it is today. There is much more revenue and stock upside for companies and investors to play for. Marijuana Stocks Capital Markets Analysis

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Tilray Stock Pledge Looking Like an Empty Promise

Bottom Line: The CEO of Tilray sold 40% of the shares he owns only two weeks after the Private Equity backer of Tilray, which he co-founded and is still Chairman of, declared it had no plans to sell its shares for the next six months. If this share sale wasn’t planned far in advance of the stock pledge it represents a very bad look for management.

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No Suprise, The Edibles Rollout Will Likely be Delayed

Bottom Line: Bill Blair, the Canadian Pot czar plans to publish edible regulations by Oct. 17. When regulations for flower and concentrates were released in 2018, it took 4 months until these products went on sale. This points to edibles not showing up online and in retail stores until January 2020 at the earliest.

Edibles are more profitable than flower and concentrate so this delay decreases the value of cannabis stocks by about 3% as an industry.

Marijuana edibles vs extracts vs dried flower infographic

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Demand Stronger Than Expected in Europe

Bottom Line: Broker Canaccord recently increased their estimates of 2018 European medical cannabis sales by 60%. Europe is currently generating 160 million euros ($180 million USD) a year, compared to sales in the U.S. and Canada of $10 billion and $500 million respectively. mj - Columbia Care expands into Europe

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There is no Canadian Supply Shortage

Bottom Line: According to the government-run cannabis tracking system, there is 80 days sales on hand of cannabis flower and 163 days of cannabis oil. A lack of supply is not the problem, it looks like there are problems somewhere in the distribution chain moving cannabis from the greenhouses to retail stores. Legal demand is likely to be fully supplied by the end of 2019 once the bottlenecks are worked out.

Source: Marijuana Business Daily

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The CBD Wave is Officially Sweeping the U.S. 

Bottom Line: CBD from the hemp plant is now federally legal, but is not supposed to be added to food, drinks or dietary supplements without individual FDA approval. Companies are doing it anyway. Expect to see CBD oil showing up at your local coffee shop, juice bar, pharmacy, and health food store any day now. To understand the profit potential of CBD click HERE Read more»

The Black Market Never Truly Dies Until Full U.S. Legalization

Bottom Line: Five years after legalization, Colorado is still seeing major black market marijuana busts. As long as criminals have an incentive to grow cannabis in legal states and export it to states with illegal markets and higher prices, the black market will endure. marijuana - mj law 5 policeRead more»

World Health Org Recommends Decriminalizing Cannabis

Bottom Line: This decision provides political cover for countries to remove cannabis from the list of the most dangerous substances, paving the way for additional loosening of country by country laws against cannabis. The report also recommends removing CBD from the dangerous drug list entirely.

Source: Wikipedia

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Weekly Marijuana Stock Performance 

Marijuana stocks had a big week, up 11% as a group. Retail investor flows are returning to cannabis as the broader market rebounds. Canadian stocks outperformed U.S. stocks by 2% up 8% for the week. Stocks are still well off their October highs but have rebounded 57% off the lows reached in December.

Market Outlook

Stocks are seeing a bounce back in the first quarter after selling off so heavily in November and December. Sentiment is getting more positive with the overall market so it is hard to see stocks going through another 20%+ selloff in the first quarter without additional negative earnings news or a global recession. A full buyout of a cannabis company by a consumer packaged good or pharmaceutical company would be a strong positive catalyst for the entire industry.

From a fundamental perspective, be careful owning cannabis stocks into the next two quarters of earnings. Distribution bottlenecks and a government monopoly do not bode well for licensed producers’ ability to meet or exceed lofty earnings estimates.

Longer term, with the Canadian market legalized we expect retail and wholesale price compression from a legal oversupply by the second half of 2019. Falling cannabis prices will pressure producer stocks later in 2019. After a shakeout, the remaining stocks will be better positioned as long-term buying opportunities.

Source: New Cannabis Ventures

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United States

Tennessee Considers Allowing Out-of-State Medical Card Holders to Possess Marijuana

Connecticut Moves Towards Marijuana Legalization, but is Meeting Opposition

Minnesota Bill 420 May Lead to Recreational Marijuana Legalization

Marijuana Recreational Legalization Progress Hits Snag in Maine


Quadron Completes Sale Of Cannabis Extraction Facility To Cannaworld Ventures

Pot Retailers Closing Amid Supply Shortages and Regulation Violations

Eve & Co Strikes Cannabis Supply Deal With German Importer

Aleafia Study Finds Medical Marijuana Reduces Benzodiazepine Use


Health Minister Calls on Ukrainians to Back Cannabis Legalization Bid

Khiron Life Sciences Shares Soar Amid Latin American Expansion

The Green Organic Dutchman Expanding into Greece With €74M Investment

Germany Set to Begin Domestic Cannabis Production

Cannabics Pharmaceuticals Targets Colombia With Joint Venture

The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Grizzle hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.