Photo by Kimzy Nanney on Unsplash

For the trading week that ended October 20, 2023, my proprietary Canadian Cannabis Company Index (MCCCI) decreased by 11.0% compared to the prior week when it decreased by 2.3%. The index consists of 15 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. 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.

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: CRON -12.0%. I have previously been bullish on Cronus Group Inc. but at present I am less so, given the malaise in the sector.

The Ugly

There were 2 stocks that decreased by 20% or more, which is my metric for inclusion in this category: CGC -25.9% and NEPT -25.5%. I believe that Canopy Growth Corporation will continue to face a heavy lift in Q4. Valuation Metric Review There was a 12.7% decrease in the “Big Four” compared to the prior week when there was a 9.9% decrease. When 2 of these companies decrease by more than 10% I believe this portends an uptick in froth for the MCCCI.

Recap

There was a 5.3% decrease in the relative strength index compared to the prior week when there was a 9.1% decrease. 1 of the 15 MCCCI stocks increased, which is indicative of the prolonged weakness in the portfolio 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, Oct. 16
The Canadian Cannabis Report - Monday, Oct. 9
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