For the trading week ended October 1, my proprietary Canadian Cannabis Company Index (MCCCI) increased by 1.2 % compared to the prior week when it decreased by 6.3%. The index consists of 23 stocks, many of which are among the most widely held holdings of the 3 ETFs (MJ, CNBS, and THCX) that I consider to be a reliable barometer of the Canadian cannabis sector.
Image by Herbal Hemp from Pixabay
The MCCCIs differentiated business model is both weighted and market capitalization based because I believe that this approach best represents the current landscape of the Canadian cannabis sector. Now let us look at this week’s good, bad, and ugly stocks.
The Good
There was 1 stock that increased by more than 10% which is my metric for inclusion in this category: ACB +19.0%. Aurora Cannabis Inc. traded higher despite lackluster financial results posted by the company on 9/27/21.
The Bad
There was 1 stock that decreased by more than 10% (but less than 20%) which is my metric for inclusion in this category: ETRGF -12.4%.
The Ugly
There were no stocks that decreased by 20% or more, which is my metric for inclusion in this category.
Valuation Metric Review
There was virtually no change in the “Big Four” compared to the prior week when it decreased by 12.2%. For the 3rd consecutive week, at least 3 of the 4 of the highest-capitalization MCCCI stocks decreased, which is indicative of how fragile the entire sector is at the present time.
Recap
The relative strength index decreased by 1.4% compared to the prior week when it decreased by 14.3%. Let us see how this volatile sector has performed at the same time next week shall we?
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