For the trading week that ended February 10, 2023, my proprietary Canadian Cannabis Company Index (MCCCI) decreased by 12.6% compared to the prior week when it increased by 4.9%. The index consists of 20 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?

Image by Herbal Hemp from Pixabay
 

The Good

There were no stocks that increased by more than 10%, which is my metric for inclusion in this category.
 

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: HEXO -12.2% and TLRY -11.2%. HEXO Corp. was on the prior week’s “good” list.
 

The Ugly

There were 2 stocks that decreased by 20% or more, which is my metric for inclusion in this category: NEPT -29.0% and CGC -21.9%. Neptune Wellness Solutions was #1 on the prior week’s “good” list and at the time I opined the stock was overbought.
 

Valuation Metric Review

There was a decrease of 14.5% in the “Big Four” (all of which decreased) compared to the prior week when there was an increase of 3.7%.
 

Recap

2 of the 20 stocks in the MCCCI increased. There was a decrease of 25.7% in the relative strength index compared to the prior week when there was a decrease of 18.6%. The recent high beta of this index is ongoing, but likely transitory. 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, Feb. 6
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