E The Canadian Cannabis Report - Tuesday, Feb. 23

green and black leaf plant

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For the trading week ended February 19, my proprietary Canadian Cannabis Company Index (MCCCI) increased by 1.4% compared to the prior week when it increased by 3.4%. The index consists of 25 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. 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: APHA +19.6%.

The Bad

There were 4 stocks that decreased by more than 10% (but less than 20%) which is my metric for inclusion in this category: WDDMF -17.0%, NXTTF -12.6%, ALEAF -11.3%, and FLWPF -10.8%. 

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 an increase of 1.7% in the “Big Four” compared to last week when there was a decrease of 2.8%. Canopy Growth Corporation, which is by far the largest capitalization in the MCCCI, has decreased 3 weeks in a row and continues to weigh down the MCCCI.

Recap

There was an increase of 8.1% in the relative strength index compared to last week when there was an increase of 4.2%. Let us see how this volatile sector has performed at the same time next week shall we?

Author’s Note

My new metric is in the final stage of development and I expect it to be operational by next week’s report.

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