For the trading week ended July 1, my proprietary Canadian Cannabis Company Index (MCCCI) decreased by 13.5% compared to the prior week when it was unchanged. The index consists of 22 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. Unsplash 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, shall we?

Image by Herbal Hemp from Pixabay

The Good

There were 3 stocks that increased by more than 10%, which is my metric for inclusion in this category: EMHTF +33.3%, ALEAF +20.0%, and TGODF +16.7%.

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: TRSSF -13.8%, TLRY -12.0%, ACB -10.6%, and OGI -10.5%.

The Ugly

There were 2 stocks that decreased by 20% or more, which is my metric for inclusion in this category: CBWTF -25.0% and CGC - 20%.

Valuation Metric Review

There was a decrease of 13.2% in the “Big Four” compared to the prior week when there was an increase of 9.5%*.

Recap

5 of the 22 stocks in the MCCCI increased, and the sharp reversal of the "Big Four” and many of the higher capitalization stocks in the portfolio adds more caution going into Q3. I have shared my thoughts regarding Canopy Growth Corporation with my private clients who participate in the option area. There was an increase of 7.3% in the relative strength index compared to the prior week when there was an increase of 1.8%*. Let us see how this volatile sector has performed at the same time next week, shall we? *Calculation error in 6/27 report Disclaimer: The information provided in this article is for general informational purposes only.

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