The Canadian Cannabis Rocket Market High.
I told a self-described millennial at the Lift conference a week ago when he asked me why his portfolio was “only up 20% last month” to cash in on his lucky winning streak, take a vacation and read a book on market cycles. It was a response to his question on how he could return to his previous year’s stellar performance, a feat I told him was directly attributed to the classic winning formula affectionately referred to as “right place, right time”.
But was it? Are we riding high or are we just at the start of the cannabis market’s hey days? After all, we all saw the headlines yesterday as Deloitte numbers suggest that legal adult-use sales in Canada will reach CAD$4.3 billion in 2019, topping up the already predicted CAD$1.8 billion estimated in medical marijuana sales next year — real numbers?
But if the hard-core dollars don’t get you excited and you simply deem the Bill C-45 Cannabis Act vote to be a right step forward in healthy living trends try Canntrust’s Brad Rogers angle on for size. He tells me: “It’s up to our government to make responsible decisions on the regulatory framework for the legalization of cannabis. Beyond monetary, we have an opportunity to create a model that the rest of the world can follow. Access to products that can provide a truly viable option for our opiate epidemic here in North America and an alternative ‘mind escape’ for the adult use market — from this alone it will be very good for society.”
Now let’s have a proper coffee talk for us capitalists here at InvestorIntel….
Called in our in-house analyst Raj Shah and asked him to give us the hard-core numbers for a dozen or so of the marijuana market stocks we are watching here at InvestorIntel for the last 30-days (see below). Between the volume action and media hysteria and some plain promotional headlines from stock promoters suggesting we are in the throes of a “once-in-a-lifetime” market similar to the post-depression alcohol era — here’s what we found…
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InvestorIntel members highlighted in yellow, the average over the last 30-days even with The Green Organic Dutchman Holdings Ltd. up 95% with their recent listing came in at 5.46%.
The fact is, speculative money goes to liquidity. So, while we can attribute the cannabis volume rodeo we are witnessing to one helluva volume-roll-a-thon, one must heed their hat and register the headlines highlighting significant shorts that suggest this is a full-on trader’s market. In other words, if you’re not a full-time professional cowboy, don’t expect your horse to save you.
InvestorIntel has published several hard-core pieces on the cannabis decrim vote tomorrow. We published Dr Luc Duchesne’s yesterday titled A yes vote does not make it legal to buy recreational cannabis in Canada. And the week before last and trending #2, we published Peter Clausi’s piece – Cannabis Will Not Decriminalize in 2018
The real question everyone is asking is will the so-called life altering vote tomorrow going to breathe more life into this market or will you be seeking this mind escape substance to recover from your losses? Off the record comments from professionals consistently state that the valuations are high. To me the valuations remind me to pricing art in that they seem to be whatever someone is willing to pay. But in our discussions with market leaders, industry players, analysts, journalists and well — the conclusion to this compelling debate was when the final decision is made – when the dust finally settles — will the air come out of the bubble or is this even a bubble…..the answers were all the same….no one really knows.
Stay tuned as we continue to secure the most accurate data we can possibly find on the cannabis public markets with weekly coverage by Dr Luc Duchesne and cannabis commentator Andy Gaudry who has won me over with his belief that cannabis will potentially solve the opiate crisis. And of course there is myself and our compliance and securities leader Peter Clausi who recommends that we watch Americans with revenue listing on the CSE. I like InvestorIntel member Sam Kanes of CO2 GRO who recommends companies focused on international expansion as eventually there will be a global market just like alcohol.
And finally, as this is the first time in my memory where not only am I watching track records of leadership which is why I initially followed Aurora Cannabis’ Terry Flood or iAnthus Capital’s Hadley Ford, but this sector is intriguing for the tools required to win…this is a game that requires money for marketing for entry or you can no longer get in.
An accomplished entrepreneur and corporate finance professional, Tracy Weslosky is the CEO for InvestorIntel Corp. and the VP of Business Development for Bellotti Capital Partners ... <Read more about Tracy Weslosky>