Canadian Cannabis LP Portfolio Popped 11% Last Week; Now +18% YTD

 

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Introduction

The munKNEE Canadian Cannabis LP Portfolio is UP 17.5% YTD - and UP 10.7% last week - despite the fact that all its constituents are faring poorly in 4 key financial metrics expressed as a % of net revenue. The financial metrics used in this analysis are a company's:

• Gross Profit Margin is the profit remaining after subtracting the cost of goods sold from revenue. A high gross profit margin reflects how efficiently a company manages its operating expenses, i.e. how successfully a company is producing profit over and above its costs;
• Selling General and Administration (SG&A) Expenses are the costs a company incurs to run its business, which include salaries, marketing, rent, utilities, and office supplies and the SG&A margin is the percentage of revenue consumed by these expenses and shows how much revenue is being absorbed by overhead costs;
• Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) is the cash profit generated by a company's operations excluding non-recurring, irregular, and one-time items such as unrealized gains or losses; non-cash expenses (depreciation, amortization); litigation expenses; gains or losses on foreign exchange; goodwill impairments; non-operating income; and share-based compensation that may distort the EBITDA;
• Net Profit or Loss Margin, or simply net margin, measures how much net income or profit a company generates as a percentage of its revenue. The net profit margin illustrates how much of each dollar in revenue collected by a company translates into profit.
• Source

Below are how each constituent's stock performed last week, MTD and YTD along with their 4 financial metrics as a % of net revenue as per their most recent quarterly financial reports and its rank compared to its peers; their market capitalization and any recent news, analyses and/or commentary on the company.

The munKNEE Canadian Cannabis LP Portfolio

1. Aurora Cannabis (ACB): UP 24.7% last week; UP 30.1% MTD; UP 27.3% YTD
   • Market Capitalization: $332M
   • Rank of Gross Profit Margin as a % of Net Revenue: #2 @ 54.2%
   • Rank of Selling, General, and Administrative Expenses as a % of Net Revenue: #4 @ 54.6%
   • Rank of Adjusted EBITDA as a % of Net Revenue: #2 @ 3.4%
   • Rank of Net Profit Margin (or Loss) as a % of Net Revenue: #2 @ (29.2)%
   • Recent News, Analyses and/or Commentary: 
     • Is Aurora Cannabis Stock a Buy?
2. Tilray Brands (TLRY): UP 8.7% last week; UP 13.3% MTD; DOWN 18.3% YTD
   • Market Capitalization: $1,580M
   • Rank of Gross Profit Margin as a % of Net Revenue: #5 @ 36.2%
   • Rank of Selling, General, and Administrative Expenses as a % of Net Revenue: #1 @ 32.5%
   • Rank of Adjusted EBITDA as a % of Net Revenue: #1 @ 3.4%
   • Rank of Net Profit Margin (or Loss) as a % of Net Revenue: #3 @ (49.2)%
   • Recent News, Analyses and/or Commentary:
     • Tilray Brands Outpaces Stock Market Gains: What You Should Know
3. Cronos Group (CRON): UP 8.1% last week; UP 3.4% MTD; UP 15.3% YTD
   • Market Capitalization: $906M
   • Rank of Gross Profit Margin as a % of Net Revenue: #1 @ (17.7)%
   • Rank of Selling, General, and Administrative Expenses as a % of Net Revenue: #5 @ (56.3)%
   • Rank of Adjusted EBITDA as a % of Net Revenue: #5 @ (42.2)%
   • Rank of Net Profit Margin (or Loss) as a % of Net Revenue: #1 @ (8.9)%
   • Recent News, Analyses and/or Commentary: 
     • Cronos Brand Spinach® Celebrates Summer with New Launches
4. Organigram (OGI): UP 6.9% last week; UP 10.4% MTD; UP 29.8% YTD
   • Market Capitalization: $177M
   • Rank of Gross Profit Margin as a % of Net Revenue: #3 @ 25.5%
   • Rank of Selling, General, and Administrative Expenses as a % of Net Revenue: #3 @ 53.6%
   • Rank of Adjusted EBITDA as a % of Net Revenue: #3 @ (0.3)%
   • Rank of Net Profit Margin (or Loss) as a % of Net Revenue: #4 @ (72.3)%
   • Recent News, Analyses and/or Commentary: 
     • Here's How BAT Is Helping Organigram Seize The German Market
5. Canopy Growth (CGC): UP 2.4% last week; UP 0.6% MTD; UP 27.0% YTD
   • Market Capitalization: $543M
   • Rank of Gross Profit Margin as a % of Net Revenue: #4 @ 21.3%
   • Rank of Selling, General, and Administrative Expenses as a % of Net Revenue: #2 @ 52.3%
   • Rank of Adjusted EBITDA as a % of Net Revenue: #4 @ (11.3)%
   • Rank of Net Profit Margin (or Loss) as a % of Net Revenue: #5 @ (126.9)%
   • Recent News, Analyses and/or Commentary: 
     • Will the U.S. Election Help Give Tilray Brands and Canopy Growth a Year-End Boost?

Summary

• On average, the LP Portfolio was UP 10.7% last week, is UP 11.4% MTD and is now UP 17.5% YTD.
• The above financial metrics as a % of net revenue by company have been averaged and are listed as follows, in descending order, to provide a comparative analysis of their respective financial health: 
  • (1) Aurora Cannabis; (2) Tilray; (3) Organigram; (4) Cronos; (5) Canopy Growth

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