The Canadian Cannabis Report - A Preview Of A Coming Attraction

My name is James Coleman, and I’m  a new contributor here at TalkMarkets. I will be launching the above weekly report as of Q2 based on  a “model” market capitalization based ETF that I developed and  the details of which I will share on April 6, 2020.

Here is a summary of my perspective regarding  the cannabis sector that I’ve shared with readers of my past articles:

MACRO 

On October 27th, 2019 I said  that“ at least 75% of the 44 companies in the Global Cannabis Stock Index will be unable to continue operations within one or two years.” I believe that the attrition rate among the Canadian cannabis sector will likely eclipse this statistic in light of the fact that the capital markets in this space have essentially evaporated since my  article was published.

 

 MICRO 

The following table recaps my most recent bearish calls on Canadian cannabis sector stocks:

I made the  following comments regarding each of these stocks at the time of publication:

CGC: “My view is that Canopy Growth Corporation (OTC:CGC) - which has been considered the creme de la creme of Canadian cannabis companies is particularly vulnerable given their precarious financials and operational issues."

HEXO Corp: “HEXO is essentially unbankable for the foreseeable future.”

CRON and TLRY: “My modelling work indicates that both Cronus Group Inc. (NASDAQ:CRON) and Tilray, Inc. (NASDAQ:TLRY) are vulnerable to a short-selling attack, which would have a domino effect price-wise on many of the largest marijuana/cannabis ETFs.”

Going forward, I believe that this sector will continue to be subject to downward price pressure as the recent spike is of a temporary nature for reasons which I will explain on April 6th.

Until then!