For the trading week ended January 8, 2022, there was a decrease of 3.4% in my proprietary Canadian Cannabis Company Index (MCCCI) compared to the prior week when there was a decrease of 9.0%. The index consists of 22 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 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.

The Good

There were 5 stocks that increased by more than 10% which is my metric for inclusion in this category: NXTTF +14.4%, MEDIF +14.1%, RDDTF +12.8%, TGODF +11.1% and DLTNF +10.7%. Lifeist Wellness Inc. has been a serial underperformer for several years and tends to be more volatile than many of the other stocks in the MCCCI.

The Bad

There were 2 stocks that decreased by more than 10% (but less than 20%) which is my metric for inclusion in this category: BHHKF -30.0% and ALEAF. Craftport Cannabis Corp. has a paltry market capitalization of $2.6M and has a very challenging future.

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 decrease of 3.4% in the “Big Four” (all of which declined) compared to the prior week when there was a decrease of 11.6%.no change.

Recap

11 of the 22 stocks in the portfolio decreased, but a more valuable metric that I have now included in my modeling work is that only 1 stock of the top ½ market capitalization increased. There was an increase of 4.1% in the relative strength index compared to the prior week when there was no change. Let us see how this volatile sector has performed at the same time next week shall we?