The Centers for Disease Control and Prevention investigation into the mysterious wave of lung illnesses related to vaping has found that the 1000+ illnesses - and 36 deaths - are linked to vaping products containing THC, the psychoactive ingredient in cannabis. That being said, however, no licensed cannabis company has been implicated in any way to the vape crisis as most of the people impacted negatively by cannabis vapes admitted to using illegal back market products. Unfortunately, as expected, this has negatively impacted the performance of the major suppliers of cannabis extract for use in vape pens and the manufacturers of said pens. This article reviews how those suppliers and manufacturers have performed over the past month.

Before going any further it is important to put the importance of vaping into perspective. According to investment firm GMP Securities,

• extracts stand to make up at least half of the Canadian market over time and
• the creme-de-la-creme of derivative products is expected to be vape pens, with 20% of the total market.

If Arcview and BDS Analytics are correct with their estimate of close to $5 billion in total Canadian pot sales by 2024, and GMP is right about vapes being the dominant derivative, we're talking about at least a $1 billion vape market in Canada, and presumably a multi-billion dollar vape market in the United States.

Companies in the cannabis vape market are either vaporizer manufacturers or extract suppliers so I have divided my analysis into these 2 segments with their performance as follows (as of October 30th and in USD):

Extract Suppliers

• Cronos Group Inc. (CRON)
  • -65% from its peak earlier this year ($23.70)
  • -25% from the end of August ($11.02)
  • - 8% from the end of September ($8.30)
• The Supreme Cannabis Company Inc. (SPRWF)
  • -68% from its peak earlier this year ($1.72)
  • -46% from the end of August ($1.02)
  • -38% from the end of September ($0.55)
• Vapen MJ Ventures Corp. (VAPNF)
  • -69% from its peak earlier this year ($1.98)
  • -65% from the end of August ($1.77)
  • -24% from the end of September ($0.62)

In summary, the above stocks declined, on average, by 12.0% in October vs. a decline of 22.1% in September.

Vaporizer Manufacturers

• KushCo Holdings Inc. (KSHB)
  • -72% from its peak earlier this year ($7.03)
  • -47% from the end of August ($3.75)
  • +35% from the end of September ($1.48)
• Greenlane Holdings Inc. (GNLN)
  • -81% from its peak earlier this year ($21.10)
  • -36% from the end of August ($6.20)
  • +17% from the end of September ($3.39)
• mCIG Inc. (WCIG)
  • -86% from its peak earlier this year ($0.21)
  • -40% from the end of August ($0.05)
  • N/C from the end of September ($0.03)
• VPR Brands LP (VPRB)
  • -64% from its peak earlier this year ($0.11)
  • -56% from the end of August ($0.09)
  • N/C from the end of September ($0.04)
• OrganiGram Holdings Inc. (OGI)
  • -60% from its peak earlier this year ($8.35)
  • -20% from the end of August ($4.21)
  • -2.6% from the end of September ($3.35)
• Wee-Cig Int'l Corp. (WCIG)
  • -67% from its peak earlier this year ($0.09)
  • -25% from the end of August ($0.04)
  • -25% from the end of September ($0.04)

In summary, the above vapor manufacturer stocks increased, on average, by 11.76% in October after a 41.3% decline in September.

In total, the above vape stocks only declined 1.56% supporting the views of Rahul Sarugaser, an analyst with Raymond James, who commented in a note to his firm's clients a month ago that the long-term impact of the vaping crisis on cannabis companies should be minimal saying: “We expect companies that have seen their stock prices decline more than the market average on account of the U.S. crisis are likely to bounce back” and all but one of the above stocks did just that.