The Canadian Cannabis Report - A Preview Of A Coming Attraction
My name is James Coleman, and I’m a new contributor here at TalkMarkets. I will be launching the above weekly report as of Q2 based on a “model” market capitalization based ETF that I developed and the details of which I will share on April 6, 2020.
Here is a summary of my perspective regarding the cannabis sector that I’ve shared with readers of my past articles:
MACRO
On October 27th, 2019 I said that“ at least 75% of the 44 companies in the Global Cannabis Stock Index will be unable to continue operations within one or two years.” I believe that the attrition rate among the Canadian cannabis sector will likely eclipse this statistic in light of the fact that the capital markets in this space have essentially evaporated since my article was published.
MICRO
The following table recaps my most recent bearish calls on Canadian cannabis sector stocks:
|
Stock Name |
Canopy Growth Corp. |
Cronos Group Inc. |
Tilray, Inc. |
HEXO Corp. |
|
Symbol |
||||
|
Date |
8/28/19 |
1/8/20 |
1/8/20 |
1/8/20 |
|
Price Then |
$23.49 |
$8.65 |
$15.33 |
$1.37 |
|
Price 3/27/20 |
$14.59 |
$6.29 |
$ 9.10 |
$1.09 |
|
% Change |
-38% |
-27% |
-41% |
-20% |
I made the following comments regarding each of these stocks at the time of publication:
CGC: “My view is that Canopy Growth Corporation (OTC:CGC) - which has been considered the creme de la creme of Canadian cannabis companies is particularly vulnerable given their precarious financials and operational issues."
HEXO Corp: “HEXO is essentially unbankable for the foreseeable future.”
CRON and TLRY: “My modelling work indicates that both Cronus Group Inc. (NASDAQ:CRON) and Tilray, Inc. (NASDAQ:TLRY) are vulnerable to a short-selling attack, which would have a domino effect price-wise on many of the largest marijuana/cannabis ETFs.”
Going forward, I believe that this sector will continue to be subject to downward price pressure as the recent spike is of a temporary nature for reasons which I will explain on April 6th.
Until then!
Welcome @[James Coleman](user:122484), looking forward to more buy you!
So it sounds like you think every cannabis is on the downtrend. Are there no bring spots in this sector?
A friend of mine shared an interesting theory recently. He said that with so many people unemployed, staying home, and conserving cash, tax revenues will be way down. As a result, he expects that legislation in the cannabis industry here in the US, which has been lagging for quite sometime, will be fast tracked so that they can make tax revenue of the cannabis industry.
Once that happens, expect a nice surge in the stock prices.
I've read your work before, nice to see you here.
It seems like the sole purpose of this article is to get people to go to Seeking Alpha. I'm surprised TM was willing to even publish this here if all it does is drive traffic to a competitor. I mean hell, if I wanted to read Seeking Alpha articles, I would be on Seeking Alpha's site, not here. Seeking Alpha has so much garbage that even the SEC has cited it as a major source of "fake news."
"Fake news?" That's a serious accusation @[Angry Old Lady](user:7657), can you back that up with a link? Seeking Alpha maybe a competitor but they are also a partner of TalkMarkets and many of the contributors here, and users, frequent both sites.
Hi Bruce, yes, that's what the SEC said. It was reported by Zero Hedge. TalkMarkets wouldn't publish it as a full article, but you can read it on Zero Hedge's personal blog on TM here: talkmarkets.com/.../sec-targets-seeking-alpha-benzinga-in-crack-down-on-fake-news-pump-and-dumps
While I personally don't read Seeking Alpha any more, I used to be an avid reader and I've read James Coleman's work previously. I think he's worth a follow - you are in for a treat. Clearly this first article is simply meant to serve as an introductory piece and give a taste of his past work. I'm sure we'll find more in-depth articles by him in the future.
James, please don't be put off by the lukewarm reception a certain Angry Lady has offered. It is not representative of the general community here.
I don't mind links so much, the bigger issue is that the links are pointless since you can't actually read them unless you subscribe to Seeking Alpha. So there's actually nothing of value here. If the author wrote up some nice summaries for us, that would at least be something.
I don't know much about #cannabis but my friend keeps telling me I should invest in $TLRY. Why do you think it's vulnerable?