E The Canadian Cannabis Report - Monday Dec. 21

Editors' note: This article discusses one or more penny stocks and/or microcaps. Such stocks are easily manipulated; do your own careful due diligence.

For the trading week ended December 18, my (proprietary) Canadian Cannabis Company Index (MCCCI) decreased by 1.4% compared to the prior week when it decreased by 7.3%. 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. 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. With only 8 trading days left in this year, my thesis of a significant downturn in the sector in 2020 is a virtual certainty

My mid-year report (published here on TalkMarkets) showed that the MCCCI had decreased by 36% YTD, which I stated may be a guidepost for the rest of 2020. I fully expect the year-end report to mimic the earlier metric. Now let us look at this week’s good, bad and ugly stocks.

green plant on blue plastic pot

Image Source: Unsplash

The Good

There were 3 stocks that increased by more than 10%, which is my metric for inclusion in this category: BHHKF +15.8%, FLWPF +14.3%, and WDDMF +12.0%. (Source: SA) Benchmark Botanics Inc. is in the lowest quintile of MCCCI stocks, and it has a de minimis effect on the performance of the portfolio. Flowr Corporation and WeedMD Inc. both bounced back from being members of last week’s “ugly” stock 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: RDDTF -17.2%. in my view, Radient Technologies Inc. faces an uncertain future due to their challenged financials.

The Ugly

There were no stocks that decreased by 20% or more, which is my metric for inclusion in this category.

Valuation Metric Review

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