The Canadian Cannabis Report - Monday, June 20

For the trading week ended June 17, my proprietary Canadian Cannabis Company Index (MCCCI) decreased by 4.3% compared to the prior week when it decreased by 19.3%. 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. 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 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: MEDIF -16.7% and TGODF -14.3%. The Green Organic Dutchman Holdings Ltd. is a repeater from the prior week’s “bad” list. It appears that the company’s turnaround plan is stalled.
 

The Ugly

There were 5 stocks that decreased by 20% or more, which is my metric for inclusion in this category: NEPT -27.5%, VVCIF -25.0%, EMHTF -25.0%, TRSSF -24.4% and HEXO -20.0%. Neptune Wellness Solutions Inc. Is a repeater from the prior week’s “ugly” list. This troubled company recently announced a change to its leadership team and a reverse split and in my view has a very uncertain future.
 

Valuation Metric Review

There was a decrease of 9.4% in the “Big Four” (all of which decreased for the 3rd consecutive week) compared to the prior week when there was a decrease of 15.0%.
 

Recap

1 of the 22 stocks in the portfolio increased, and the continued suboptimal performance of the "Big Four” further hamstrings the MCCCI. There was a decrease of 2.9% in the relative strength index compared to the prior week when there was a decrease of 4.3%. Let us see how this volatile sector has performed at the same time next week, shall we?