The Canadian Cannabis Report - Monday, Oct. 17

The Canadian Cannabis Report - Monday, Oct. 17 For the trading week that ended October 14, my proprietary Canadian Cannabis Company Index (MCCCI) decreased by 4.6% compared to the prior week when it increased by 7.5%. 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 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 3 stocks that decreased by more than 10% (but less than 20%) which is my metric for inclusion in this category: TRSSF -15.8%, VLNS -13.7%, and CGC -11.3%. TerrAscend Corp. was on last week’s “good” list and has a beta of 1.75. I have sent out an alert to my private clients regarding this 1st quartile MCCCI stock.
 

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 decrease of 3.0% in the “Big Four” compared to the prior week when there was an increase of 4.7%. I am especially concerned with the recent trading pattern in Canopy Growth Corporation, which is the largest capitalization stock in the portfolio.
 

Recap

4 of the 22 stocks in the MCCCI increased, foreshadowing caution in the sector. There was a decrease of 4.7% in the relative strength index compared to the prior week when there was an increase of 10.3%. Let us see how this volatile sector has performed at the same time next week, shall we?

---

More By This Author:

The Canadian Cannabis Report - Monday, Oct. 10
The Canadian Cannabis Report - Monday, Oct. 3
The Canadian Cannabis Report - Monday, Sept. 26