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For the trading week ended May 24, 2024, my proprietary Canadian Cannabis Company Index (MCCCI) decreased by a de minimis 0.9% compared to the prior week when it increased by 8.8%. The index consists of 14 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?

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: CBWTF -12.7%. and TSNDF -10.5%. Auxly Cannabis Group Inc. was also a “bad” stock in the prior week. TerrAscend Corp. has not issued any news since reporting EPS and revenue misses on 5/9/24.

The Ugly

There were no stocks that decreased by 20% or more, which is my metric for inclusion in this category.

Valuation Metric Review

There was a 10.2% decrease in the “Big 4” (all of which decreased) compared to the prior week when there was an 8.5% increase. TerrAscend Corp. (TSNDF) was the “biggest loser” in the cohort and decreased by 10.5%. I have added Canopy Growth Corporation (CGC) to my “optionable stock to watch” list provided to my private clients based on its recent weak trading pattern.

Recap

There was a 6.7% decrease in the relative strength index compared to the prior week when there was a 12.7% decrease. None of the 14 MCCCI stocks increased. I have developed a “hat trick” of MCCCI stocks which are most vulnerable to price pressure in Q4. Stay tuned for granularity in this regard very soon. Let us see how this volatile sector has performed at the same time next week, shall we?

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