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Friday, February 12, 2021 3:05:50 PM
Cannabis Stocks Felt the Reddit Rumble This Week
By: Schaeffer's Investment Research | February 12, 2021
• The cannabis sector was the latest target of Reddit traders this week
• Tilray, Canopy Growth, and Cronos all scored record highs
Welcome back to our weekly series, Schaeffer's Cannabis Stock News Update, where we recap what happened in the world of marijuana stocks last week, and look ahead to how the cannabis industry will continue to develop in the 2021.
Investor interest in the cannabis industry is growing at an explosive growth rate, and the leading players continue to break through legal barrier after legal barrier, especially in the United States. More than 40 U.S. states legalized recreational and/or medical marijuana by the end of 2020. Now, more and more companies are starting to see the opportunity in cannabis cultivation, marketing, distribution, and technology.
The Reddit traders on r/WallStreetBets set their sights on cannabis stocks over the past week. Although the stocks pulled back on Thursday, both Tilray (TLRY) and Aurora Cannabis (ACB) gapped higher earlier in the week and remain up for the week even after the pullbacks. The Reddit group zeroed in on the pot stocks sector as a "big long-term opportunity" for traders.
After the Senate runoff elections tilted the majority toward Democrats last month, there has been continuing anticipation that the prospects of cannabis legislation will now find footing in Congress. While full-scale legalization may be out of reach, smaller reforms tied to police and banking could positively impact the cannabis industry.
If federal legalization happens, Wall Street analysts recently said that, by 2030, the cannabis market could be worth somewhere around $115 billion. As the cannabis sector continues to grow, investors can anticipate many more marijuana stock initial public offerings (IPOs) on the horizon for the cannabis industry.
Here is a quick roundup of major cannabis stock news this week (Feb. 8 through Feb. 12):
Akerna Corp. (NASDAQ:KERN) is the developer of M.J. Platform, the cannabis industry's first seed-to-sale enterprise resource platform. KERN announced on Feb. 11 that the platform has reached SAP Certification, in integration with SAP NetWeaver.
The Canadian company defining the future of cannabinoids worldwide, Aurora Cannabis Inc. (NYSE:ACB), released its earnings and financial results for the second fiscal quarter of 2021 on Feb. 11. Aurora's consumer cannabis revenue was down 17% from the first quarter -- its lowest level since the second quarter of 2019. Aurora stock was down 9% at $13.17 in pre-market trading today, after receiving a downgrade from MKM Partners to "sell" in the wake of a disappointing fiscal second-quarter earnings report.
Canopy Growth Corporation (NASDAQ:CGC) released earnings and financial results for the third fiscal quarter of 2021 on Feb. 9. Improved commercial and operational execution drove a record net revenue of $153 million, up 23% year-over-year. A net loss of $829 million was reported for Q3. The shares of CGC surged higher post-earnings, up 5.2% to trade at $46.17, after the cannabis name reported smaller-than-expected fiscal third-quarter losses, as well as a revenue beat.
One of the nation's leading and most highly trusted and recognized cannabidiol (CBD) brands, cbdMD, Inc. (NYSE:YCBD), released earnings and financial results for its first fiscal quarter of 2021 on Feb. 9. Year-over-year net sales increased 22% to a record-setting $12.3 million. Cost of operations decreased by 71% to $1.8 million compared to $6.1 million in 2020.
The shares of cannabis stock Aphria Inc (NASDAQ:APHA) surged on Tuesday, getting a nice little halo lift from pending merger partner Tilray (TLRY), after the latter nailed down a deal with Grow Pharma to import and distribute its medical cannabis product into the United Kingdom. As a result, APHA was up 24.8% and tapped a new all-time high of $23.68.
FSD Pharma Inc. (NASDAQ:HUGE) announced on Feb. 11 that it has entered into an equity distribution agreement with Alliance Global Partners. Under the sales agreement, FSD Pharma may, at its sold discretion during the term of the sales agreement, sell Class B shares of the company.
The shares of Canada-based cannabis company Cronos Group Inc (NASDAQ:CRON) traded at new record highs on Feb. 9, up 7.2% at $13.74. With help from the 20-day moving average, Cronos stock has moved upward on the charts since the start of the year -- already posting a 98% year-to-date lead
Greenlane Holdings, Inc. (NASDAQ:GNLN), a global house of brands and one of the largest sellers of premium cannabis accessories, relayed on Feb. 9 that a complaint filed in December of 2019 with the Circuit Court of the Fifteenth Judicial Circuit for Palm Beach County has been dismissed in its entirety for failure to state a cause of action.
HEXO Corp (NYSE:HEXO) made an announcement on Feb. 8 that the company has appointed Charles Bowman as General Manager of its U.S. operations, effective immediately.
The first and only real estate company focused on the regulated U.S. cannabis industry, Innovative Industrial Properties, Inc. (NYSE:IIPR), announced on Feb. 8 that it is extending its long-term real estate relationship with Kings Garden Inc, one of California's top cannabis producers. This extension includes the acquisition of approximately 3.5 acres in Southern California adjacent to one of IIPR's properties leased to Kings Garden, where IIPR and Kings Garden will partner on the development of two additional buildings totaling approximately 180,000 square feet of industrial space.
Village Farms International, Inc. (NASDAQ:VFF) released a statement on Feb. 8 that it has repaid in full its $15.6 million promissory note, plus accrued interest of US$500,000, that it issued initially to Emerald Health Therapeutics as partial consideration for the November 2020 acquisition from Emerald of the 37 million common shares of Pure Sunfarms Corp. that Village Farms did not own. Village Farms no longer owes anything to Emerald for the Pure Sunfarms transaction.
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By: Schaeffer's Investment Research | February 12, 2021
• The cannabis sector was the latest target of Reddit traders this week
• Tilray, Canopy Growth, and Cronos all scored record highs
Welcome back to our weekly series, Schaeffer's Cannabis Stock News Update, where we recap what happened in the world of marijuana stocks last week, and look ahead to how the cannabis industry will continue to develop in the 2021.
Investor interest in the cannabis industry is growing at an explosive growth rate, and the leading players continue to break through legal barrier after legal barrier, especially in the United States. More than 40 U.S. states legalized recreational and/or medical marijuana by the end of 2020. Now, more and more companies are starting to see the opportunity in cannabis cultivation, marketing, distribution, and technology.
The Reddit traders on r/WallStreetBets set their sights on cannabis stocks over the past week. Although the stocks pulled back on Thursday, both Tilray (TLRY) and Aurora Cannabis (ACB) gapped higher earlier in the week and remain up for the week even after the pullbacks. The Reddit group zeroed in on the pot stocks sector as a "big long-term opportunity" for traders.
After the Senate runoff elections tilted the majority toward Democrats last month, there has been continuing anticipation that the prospects of cannabis legislation will now find footing in Congress. While full-scale legalization may be out of reach, smaller reforms tied to police and banking could positively impact the cannabis industry.
If federal legalization happens, Wall Street analysts recently said that, by 2030, the cannabis market could be worth somewhere around $115 billion. As the cannabis sector continues to grow, investors can anticipate many more marijuana stock initial public offerings (IPOs) on the horizon for the cannabis industry.
Here is a quick roundup of major cannabis stock news this week (Feb. 8 through Feb. 12):
Akerna Corp. (NASDAQ:KERN) is the developer of M.J. Platform, the cannabis industry's first seed-to-sale enterprise resource platform. KERN announced on Feb. 11 that the platform has reached SAP Certification, in integration with SAP NetWeaver.
The Canadian company defining the future of cannabinoids worldwide, Aurora Cannabis Inc. (NYSE:ACB), released its earnings and financial results for the second fiscal quarter of 2021 on Feb. 11. Aurora's consumer cannabis revenue was down 17% from the first quarter -- its lowest level since the second quarter of 2019. Aurora stock was down 9% at $13.17 in pre-market trading today, after receiving a downgrade from MKM Partners to "sell" in the wake of a disappointing fiscal second-quarter earnings report.
Canopy Growth Corporation (NASDAQ:CGC) released earnings and financial results for the third fiscal quarter of 2021 on Feb. 9. Improved commercial and operational execution drove a record net revenue of $153 million, up 23% year-over-year. A net loss of $829 million was reported for Q3. The shares of CGC surged higher post-earnings, up 5.2% to trade at $46.17, after the cannabis name reported smaller-than-expected fiscal third-quarter losses, as well as a revenue beat.
One of the nation's leading and most highly trusted and recognized cannabidiol (CBD) brands, cbdMD, Inc. (NYSE:YCBD), released earnings and financial results for its first fiscal quarter of 2021 on Feb. 9. Year-over-year net sales increased 22% to a record-setting $12.3 million. Cost of operations decreased by 71% to $1.8 million compared to $6.1 million in 2020.
The shares of cannabis stock Aphria Inc (NASDAQ:APHA) surged on Tuesday, getting a nice little halo lift from pending merger partner Tilray (TLRY), after the latter nailed down a deal with Grow Pharma to import and distribute its medical cannabis product into the United Kingdom. As a result, APHA was up 24.8% and tapped a new all-time high of $23.68.
FSD Pharma Inc. (NASDAQ:HUGE) announced on Feb. 11 that it has entered into an equity distribution agreement with Alliance Global Partners. Under the sales agreement, FSD Pharma may, at its sold discretion during the term of the sales agreement, sell Class B shares of the company.
The shares of Canada-based cannabis company Cronos Group Inc (NASDAQ:CRON) traded at new record highs on Feb. 9, up 7.2% at $13.74. With help from the 20-day moving average, Cronos stock has moved upward on the charts since the start of the year -- already posting a 98% year-to-date lead
Greenlane Holdings, Inc. (NASDAQ:GNLN), a global house of brands and one of the largest sellers of premium cannabis accessories, relayed on Feb. 9 that a complaint filed in December of 2019 with the Circuit Court of the Fifteenth Judicial Circuit for Palm Beach County has been dismissed in its entirety for failure to state a cause of action.
HEXO Corp (NYSE:HEXO) made an announcement on Feb. 8 that the company has appointed Charles Bowman as General Manager of its U.S. operations, effective immediately.
The first and only real estate company focused on the regulated U.S. cannabis industry, Innovative Industrial Properties, Inc. (NYSE:IIPR), announced on Feb. 8 that it is extending its long-term real estate relationship with Kings Garden Inc, one of California's top cannabis producers. This extension includes the acquisition of approximately 3.5 acres in Southern California adjacent to one of IIPR's properties leased to Kings Garden, where IIPR and Kings Garden will partner on the development of two additional buildings totaling approximately 180,000 square feet of industrial space.
Village Farms International, Inc. (NASDAQ:VFF) released a statement on Feb. 8 that it has repaid in full its $15.6 million promissory note, plus accrued interest of US$500,000, that it issued initially to Emerald Health Therapeutics as partial consideration for the November 2020 acquisition from Emerald of the 37 million common shares of Pure Sunfarms Corp. that Village Farms did not own. Village Farms no longer owes anything to Emerald for the Pure Sunfarms transaction.
Read Full Story »»»
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