For the trading week ended May 13, my proprietary Canadian Cannabis Company Index (MCCCI) decreased by 7.0% compared to the prior week when it decreased by 4.3%. 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. 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 Ria Sopala from Pixabay

The Good

There were no stocks that increased by more than 10% (but less than 20%) which is my metric for inclusion in this category.

The Bad

There were 3 stocks that decreased by more than 10% (but less than 20%) which is my metric for inclusion in this category: ALEAF –14.6%, MEDIF –12.5%, and NEPT –11.8%.

The Ugly

There were 4 stocks that decreased by 20% or more, which is my metric for inclusion in this category: RDDTF -33.3%, VLNS -25.8%, HEXO -23.5% and VVCIF -20.0%. HEXO, which I referred to as my “#1 troubled stock to watch” continued trending downward and now trades at $0.26 per share. Option players among my private clients have revealed in HEXOs 95.7% 1-year decline.

Valuation Metric Review

There was a decrease of 8.0% in the “Big Four” compared to last week when there was a decrease of 1.0%. I will pay closer attention to the performance of this subset going forward, as it is a guidepost for the MCCCI.

Recap

3 of the 22 stocks in the portfolio increased. There was a decrease of 9.6% in the relative strength index compared to the prior week when there was a decrease of 11.4%. Let us see how this volatile sector has performed at the same time next week, shall we?