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For the trading week that ended February 16, 2024, my proprietary Canadian Cannabis Company Index (MCCCI) was unchanged compared to the prior week when it was also unchanged. The index consists of fourteen stocks, many of which are among the most widely held holdings of the three  ETFs (MJ, CNBS, and THCX) that I consider to be a reliable barometer of the Canadian cannabis sector. MCCCI's 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, shall we?

The Good

There were no stocks that increased by more than 10%, which is my metric for inclusion in this category. OrganiGram Holdings Inc. (OGI) broke their two-week spike upwards, but the stock has increased 66.4% YTD. I do not follow this company closely enough to have a rating on it but I consider it a “stock to watch”,

The Bad

There were no stocks that decreased by more than 10% (but less than 20%) which is my metric for inclusion in this category: 

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 a 1.7% increase in the “Big Four” (three of which increased) compared to the prior week when there was no change. Canopy Growth Corporation (CGC) was the outlier of the group and decreased 4.0%. This stock is a favorite of option players and there is a bull/bear tug of war underway. I am on the sidelines but it is a very interesting situation to be sure.

Recap

There was a 2.4% decrease in the relative strength index compared to the prior week when there was a 2.5% increase. Worth noting is that the “Big Four” have decreased 30.4% YTD. Cronus Group Inc. (CRON) is the outlier of this cohort and has increased 8.6%. Readers may be interested in a bullish article I published on 11/8/22. The import of this article is CRON has in fact fared better than their peers as I had “predicted.”Next week I hope to present my current thesis for the Canadian cannabis sector. Spoiler alert- expect a caveat emptor.    

Let us see how this volatile sector has performed at the same time next week, shall we?

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The Canadian Cannabis Report - Monday, Feb. 12
The Canadian Cannabis Report - Monday, Feb. 5
The Canadian Cannabis Report - Monday, Jan. 29