Cannabis Central: Pure-Play Pot Stock Index Down 4.2% Friday

The munKNEE.com Pot Stock Index of the 25 pure-play* cannabis stocks that trade for more than US$1/share declined 4.2% on Friday with 7 constituents advancing, 17 declining, and 3 of the 4 associated sector categories declining. The details are as follows:

Only 3 constituents advanced by 5% or more namely:

• Avicanna (AVCNF) advanced again on Friday (11.9%) for a 28.2% increase on the week.
• Columbia (CCHWF) +6.9%
• Medicine Man (SHWZ) +5.8%

4 other constituents advanced and 1 had no change in price.

Only 1 constituent declined by 5% or more, namely:

• Harvest Health (HRVSF) -7.6% for a decline of 13.8% on the week.

16 other constituents declined.

The constituents operate in 4 categories based on their primary area of focus in the cannabis industry and the constituents within each category are identified below with how each of the categories did:

1. The Vertically Integrated (i.e. Seed-to-Sale) Category consists of 21 companies that grow, process, and sell cannabis and hemp flower and related products and it declined 4.4%.
   • the 7 constituents that are Canadian Licensed Producers (LPs) declined 2.1%, on average.
     • ACB; APHA; CGC; CRON; OGI; ROMJF and TLRY
   • the 12 constituents that are U.S. Multi-State Operators (MSOs) declined 5.8%, on average.
     • ACRGF; AYRSF; CCHWF; CRLBF; CURLF; GTBIF; JUSHF; PLNHF; SHWZ; TRSSF; TCNNF and HRVSF
   • the 2 MSO constituents that are only involved in the seed-to-sale of CBD from hemp declined 3.3%, on average.
     • CWBHF and YCBD
2. The Extraction Category consists of companies focused on the extraction of cannabis compounds and their infusion into consumer products and it declined 3.8%, on average.
   • the 2 constituents in this category are NEPT and VLNCF
3. The Consumption Devices Category consists of companies focused on developing and selling personal consumption devices for cannabis consumers such as vape pens and inhalers. It declined 1.5% on Thursday compared to a 6.0% advance on Wednesday.
   • the 1 constituent in this category is GNLN
4. The Biotechnology Category consists of pharmaceutical companies marketing new drugs and products utilizing cannabinoids and the category advanced 11.9% on Friday in addition to +3.5% on Thursday, +3.6% on Wednesday, +4.6% on Tuesday and +2.8% on Monday.
   • the 1 constituent in this category is AVCNF

Further details regarding the equal-weighted munKNEE.com Pot Stock Index are as follows:

1. *The 25 pure-play constituents in the munKNEE.com PSI are just that, pure, deriving 100% of their revenue from the sale of cannabis or cannabis-related products.

• Unlike every marijuana ETF (see this TalkMarkets article) and every other cannabis tracking index (see this TalkMarkets article), themunKNEE.comPot Stock Index excludes "wanna-be" companies that generate little, if any, of their total revenue directly from the cannabis industry, to reflect the true health of the marijuana industry in the U.S. and Canada. As such, thePSI excludes the following 12 companies: 
  • GW Pharmaceuticals (GWPH), is a bio-pharmaceutical company that generates 90% of its revenue from one cannabis-based product, Epidiolex;
  • Cara (CARA), Corbus (CRBP), Zynerba (ZYNE) and XPhyto (XPHYF) are bio-pharmaceutical companies that are only doing research into the development of pharmaceuticals containing either CBD and/or THC but have not, as yet, introduced any such products into the marketplace; 
  • GrowGeneration (GRWG) and Scotts Miracle-Gro (SMG) are companies that supply hydroponic equipment and fertilizer to the industry; 
  • Innovative Industrial Properties (IIPR), a real estate investment trust (REIT), is engaged in the acquisition, ownership and management of specialized industrial properties leased to state-licensed operators for their regulated medical-use cannabis facilities; 
  • New Age Beverages (NBEV) is a beverage company doing research and development of a marijuana-infused line of drinks; 
  • Alcanna (LQSIF) is a retail liquor chain in Alberta, Canada, that also sells recreational marijuana products; 
  • Alkerna (KERN) is a technology company that provides a central data management system for tracking regulated cannabis products and 
  • Village Farms (VFF) is a grower of produces and marketer of greenhouse tomatoes, bell peppers, and cucumbers and power supplier with a 57.4% joint venture with the private seed-to-sale Licensed Producer, Pure Sunfarms.

2. The average market capitalization of the companies in our PSI is US$963M.