Tuesday, March 16, 2021 11:26:40 PM
The Charles Report
STOCK INVESTMENT NEWSLETTER
March 16th, 2021 no.114
ZOOM meetings 5:00pm PST Saturdays every 2 weeks
Next meeting March 27th
https://www.meetup.com/stock-market-investing/
https://investorshub.advfn.com/JohnCM-Investment-Corner-37729/
https://investorshub.advfn.com/Cannabis-Investment-Club-33161/
The Charles Report
Feature TILT Holdings OTC QX TLLTF
$0.5689
March 9th, 2021
TILT helps cannabis businesses build brands. Through a portfolio of companies providing technology, hardware, cultivation and production, TILT services brands and cannabis retailers across 35 states in the U.S., as well as Canada, Israel, Mexico, South America and the European Union. TILT’s core businesses include Jupiter Research, LLC, a wholly owned subsidiary and leader in the vaporization segment focused on hardware design, research, development and manufacturing, and cannabis operations Commonwealth Alternative Care, Inc. in Massachusetts and Standard Farms, LLC in Pennsylvania. TILT is headquartered in Phoenix, Arizona.
Outstanding Shares 323,756,294 03/02/2021
TILT Holdings Provides Preliminary Fourth Quarter Results, Operational Highlights and 2021 Outlook 02/17/2021
Jupiter Q4 2020 revenues return to pre-COVID levels
Standard Farms extraction capacity increased by 100% during Q4 2020
CAC lab and kitchen production capacity increased by 100% during Q4 2020
Projected Preliminary Financial Highlights:
• Q4 2020 revenue is projected to be between $42.2 million and $43.2 million, compared to Q3 2020 revenue of $40.4 million
• Q4 2020 Adjusted EBITDA is projected to be between $2.6 million and $3.6 million, compared to Q3 2020 Adjusted EBITDA of $2.8 million
• Pro-forma Q4 2020 revenue excluding the Company’s former subsidiary, Blackbird, is projected to be between $41.3 million and $42.3 million, compared to Q3 2020 pro-forma revenue of $39.1 million
• Pro-forma Q4 2020 Adjusted EBITDA excluding the Company’s former subsidiary, Blackbird, is projected to be between $4.6 million and $5.6 million, compared to Q3 2020 pro-forma Adjusted EBITDA of $5.4 million
• $7.4 million cash balance as of Dec. 31, 2020, compared to $4.3 million at Sept. 30, 2020
Fourth Quarter 2020 Operational Highlights:
• Jupiter Research LLC’s (“Jupiter”) power supply revenue doubled from Q3 2020 to Q4 2020; revenues during the quarter reached pre-COVID levels
• Commonwealth Alternative Care, Inc.’s (“CAC”) lab and kitchen production capacity increased 100% during the quarter; cultivation expansion approved October 2020 planted during Q4 2020 and expected to yield first harvest in March 2021
• Standard Farms, LLC (“Standard Farms”) doubled extraction processing capacity during the quarter; introduced six new manufactured product offerings
Full Year 2021 Outlook:
2021 strategic initiatives fully funded; outlook not expected to require significant CAPEX or M&A.
• Revenue range of $205 million to $210 million
• Adjusted EBITDA range of $30 million to $32 million
TILT Holdings Reports Third Quarter 2020 Financial Results Including Record Adjusted EBITDA, Enters into Definitive Agreement for the Sale of Blackbird Subsidiary 11/18/2020
Revenue of $40.4 million, driven in part by a 24% sequential increase in the cannabis segment compared to the second quarter of 2020
Gross margin of 30.3%, a 193-basis point improvement from the second quarter of 2020, driven by margin expansion in the cannabis segment
Record adjusted EBITDA of $2.8 million, an increase of 134% from the second quarter of 2020
Upon closing, Blackbird divestiture reduces cash burn, improves third quarter 2020 adjusted EBITDA by 96% on a pro-forma basis
Financial Summary for the Quarter Ended September 30, 2020
• Revenue of $40.4 million, a 5% increase from the second quarter of 2020 and a decline of 12% from the prior year period.
• Gross margin1 of 30.3%, up 193 basis points (“bps”) from the second quarter of 2020 and up 8 bps from the prior year period.
• Positive adjusted EBITDA for the third consecutive quarter at $2.8 million, a 134% increase from the second quarter of 2020, and a 3% increase from the prior year period.
• Excluding the impact of Blackbird, pro-forma adjusted EBITDA of $5.4 million for the second quarter of 2020 and $12.7 million year to date.
• Net loss ($4,617,000)
• Cash and cash equivalents of $4.3 million, a decline from the previous quarter $10.5 million as of June 30, 2020 due, in part, to additional inventory required to fulfill increasing orders.
“The Reddit Hangover”
Mark this date down on your calendar, February 10th, 2021. This date marks the “blow off top”, the exuberant top”, the “frenzied froth”, the “bubble before bursting.” Typically, if you are participating in this type of upward move in your portfolio, you are drunk with greed. You are envisioning that trip to Rarotonga Island. The last thing you are going to do is sell! Are you crazy!? Why would I sell when my stocks are doing so well? I am a financial genius!
Well, this is exactly the time to sell. But, I am a big fan of “leveraging” in and out. Typically, I do not take 100% of the monies allocated to buy a stock or my entire position in a stock, and buy or sell it. Maybe 33 percent, depending? Maybe more, maybe less. If you are a frozen statue when the time is right to sell RSI 80 or buy RSI 20, take 10 or 20 percent and trade around your position. Get a feel for it.
Back to the “Reddit Rush.” When momentum, fan boys, greedy bastards, pump and dumpers control the market, they will push it north as hard and fast as they can. What does this action have to do with each individual company’s prospects or the long term view of the sector of interest? Nothing. So, you react to what “the market is telling you.” On February 10th the market was telling you to sell 50% of your position, give or take. Trade around a core position. If your stock continued to spike, no worries, you still have your 50%. But if the bubble pops, you are not riding 100 percent of your position all the way back down. Poof! There goes your trip to Rarotonga.
In A Related Story
After the February 10th blowoff top, we finally reversed down to a climax low last Friday morning. This is the low for most Cannabis stocks as we ride thru the rest of 2021.
Cannabis EFT MJ Feb 10th $34.50 March 5th $19.50 Current $23.03
Harvest Health & Recreation Inc. (HRVSF)
Founded in 2011, HRVSF is involved in the cultivation, processing, and selling of cannabis in the United States. It offers cannabis oil, capsules, tinctures, and cannabis product edibles under the Roll One, Modern Flower, Evolab brands, among others. The company also operates retail dispensaries that sell cannabis products to patients and customers.
Last month, HRVSF completed the divestiture of its two medical marijuana dispensary assets in North Dakota as a part of its strategic plan to allocate resources in core markets to further enhance growth opportunities.
In January, it launched recreational cannabis sales in Arizona. HRVSF registered its first sale as it began offering access to regulated and legal cannabis products to serve both medical patients and recreational customers across the state.
HRVSF’s total revenue increased 86% year-over-year to $61.64 million in the third quarter, ended September 30, 2020. Its gross profit grew 222.7% from the year-ago value to $38.33 million, while its adjusted EBITDA rose 156.1% sequentially to $10.5 million over this period. The company’s gross profit margin, excluding biological adjustments, in the third quarter was 46.6%, compared to 35.0% in the third quarter of 2019.
A consensus EPS estimate for fiscal 2021 represents a 158.3% improvement year-over-year. The consensus revenue estimate of $378.07 million for the current year represents a 65.3% increase from the same period last year. The stock has gained 97.6% over the past year.
Of the four Wall Street analysts that provided ratings for the stock, three have rated it “Buy.” Also, the consensus price target of $5.71 represents a potential upside of 47.1%.
PUMP CITY! TILT HOLDINGS
Here we come.
Looking for RSI(14) 80+
What Is the Relative Strength Index (RSI)?
The relative strength index (RSI) is a momentum indicator used in technical analysis that measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock or other asset. The RSI is displayed as an oscillator (a line graph that moves between two extremes) and can have a reading from 0 to 100. The indicator was originally developed by J. Welles Wilder Jr. and introduced in his seminal 1978 book, "New Concepts in Technical Trading Systems."
Traditional interpretation and usage of the RSI are that values of 70 or above indicate that a security is becoming overbought or overvalued and may be primed for a trend reversal or corrective pullback in price. An RSI reading of 30 or below indicates an oversold or undervalued condition.
KEY TAKEAWAYS
The relative strength index (RSI) is a popular momentum oscillator developed in 1978.
The RSI provides technical traders signals about bullish and bearish price momentum, and it is often plotted beneath the graph of an asset's price.
An asset is usually considered overbought when the RSI is above 70% and oversold when it is below 30%.
Relative Strength Index (RSI)
The Formula for RSI
The relative strength index (RSI) is computed with a two-part calculation that starts with the following formula:
The average gain or loss used in the calculation is the average percentage gain or loss during a look-back period. The formula uses a positive value for the average loss.
The standard is to use 14 periods to calculate the initial RSI value. For example, imagine the market closed higher seven out of the past 14 days with an average gain of 1%. The remaining seven days all closed lower with an average loss of -0.8%. The calculation for the first part of the RSI would look like the following expanded calculation:
Once there are 14 periods of data available, the second part of the RSI formula can be calculated. The second step of the calculation smooths the results.
Calculation of the RSI
Using the formulas above, RSI can be calculated, where the RSI line can then be plotted beneath an asset's price chart.
The RSI will rise as the number and size of positive closes increase, and it will fall as the number and size of losses increase. The second part of the calculation smooths the result, so the RSI will only near 100 or 0 in a strongly trending market.
The RSI indicator can stay in the overbought region for extended periods while the stock is in an uptrend. The indicator may also remain in oversold territory for a long time when the stock is in a downtrend. This can be confusing for new analysts, but learning to use the indicator within the context of the prevailing trend will clarify these issues.
What Does RSI Tell You?
The primary trend of the stock or asset is an important tool in making sure the indicator's readings are properly understood. For example, well-known market technician Constance Brown, CMT, has promoted the idea that an oversold reading on the RSI in an uptrend is likely much higher than 30%, and an overbought reading on the RSI during a downtrend is much lower than the 70% level.
During a downtrend, the RSI would peak near the 50% level rather than 70%, which could be used by investors to more reliably signal bearish conditions. Many investors will apply a horizontal trendline that is between 30% and 70% levels when a strong trend is in place to better identify extremes. Modifying overbought or oversold levels when the price of a stock or asset is in a long-term, horizontal channel is usually unnecessary.
A related concept to using overbought or oversold levels appropriate to the trend is to focus on trading signals and techniques that conform to the trend. In other words, using bullish signals when the price is in a bullish trend and bearish signals when a stock is in a bearish trend will help to avoid the many false alarms the RSI can generate.
Exchange Traded Funds - Inverse/Bear - Real Estate
Proshares Ultrashort 2X Real Estate SRS
$11.98 52-week high $39.56 Mar 12
ProShares Short 1X Real Estate REK
$11.21 52-week high $19.63 Mar 12
Direxion Daily MSCI Real Estate Bear 3X Shares DRV
$9.19 52-week high $71.04 Mar 12
SPAC Stock Of The Week!
THBR
U.S. Nasdaq
Thunder Bridge Acquisition II Ltd. Cl A
About indie
indie is empowering the Autotech revolution with next generation automotive semiconductors and software platforms. We focus on edge sensors for Advanced Driver Assistance Systems including LiDAR, connected car, user experience and electrification applications. These technologies represent the core underpinnings of both electric and autonomous vehicles, while the advanced user interfaces transform the in-cabin experience to mirror and seamlessly connect to the mobile platforms we rely on every day. We are an approved vendor to Tier 1 partners and our solutions can be found in marquee automotive OEMs around the world. Headquartered in Aliso Viejo, CA, indie has design centers and sales offices in Austin, TX; Boston, MA; Detroit, MI; San Francisco and San Jose, CA; Budapest, Hungary; Dresden, Germany; Edinburgh, Scotland and various locations throughout China.
Please visit us at www.indiesemi.com to learn more.
Thunder Bridge Acquisition II started at buy with $17 stock price target at Benchmark. Mar. 9, 2021
EMERGENCY
INDUS HOLDINGS INDXF
$1.92(SOLD)
BUY TILT TLLTF
$0.545 ($0.50, $0.54, $0.5689)
Trading Secret #4
This technique has taken me 35 years to get right.
Download the smartphone app "Stocks Alert."
Pick a percentage of your total shares in your position that you will use to trade around your core position. 33 percent?
Set the RSI(14) alert to 80.
When 80 is triggered, sell 33 percent.
Buyback at 60 and either pocket the cash difference or buy back more shares than you sold.
INTEREST RATES
Hmmm, how do interest rates affect me? And why do they increase? (Or rather why does the FED increase interest rates?) Is it simply supply and demand? In a way, yes. The primary motivation for the increase in interest rates is to keep inflation from rising. What increases inflation? Demand. What is the result of inflation? Higher price tags for everything you spend your money on. Services, goods, travel, food, housing, fuel, clothing, luxury items, etc.
So, if the FED is keeping an eye on inflation, why do I need to pay attention to interest rates? All depends. Do you have any investments in Real Estate or in the Stock Market? Hopefully, by now, most folks have converted their ARM mortgage into fixed rate. In that case, a higher interest rate on your mortgage is not a worry.
How about the stock market? You would think that a recovering economy would help buoy the markets, right? Yes, to a limit. The market is typically 6 months forward looking. So, your stocks have already priced in where economists expect the U.S. to be on August 1st, 2021. When interest rates increase, so do the number of alternative, safer vehicles to earn interest/dividends/capital gains on your stock market investment. When there are more, safer alternatives, they are fewer buyers of company stock as an investment.
I should add here, as a rule, precious metals should take up a 5% position in your portfolio. Individual miners, ETF (long/inverse/ leveraged 1X 2X 3X), or simple bullion.
Getting back to the stock market. The markets right now are priced to perfection. Any seismic shift will send the DOW lower. A 10 percent decline is still not out of the equation. Seismic shift? World events i.e., saber rattling from a communist country. Nuclear arms concerns. Higher interest rates. A major setback in the fight against COVID-19, to name a few.
When you see a meaningful increase in interested rates, and as I mentioned earlier, the trend is beginning right now, you want to have a defensive game plan in regard to your stock positions. (Not so much mutual funds. You have professionals baby-sitting those for you). There are a number of ways you can prepare for future pressures on the stock market. Look for sector niches that will benefit from the recovering economy. Use ETF funds for this. Set stop limit orders to protect your gains (you do not want to give them all back). Look to inverse ETF (bear) funds. Precious metals. CASH.
Getting back to Real Estate. I hate to say it BUT the party will not last forever. This is not directed to quality Real Estate agents who always flourish because of their elevated marketing skills and their ability to work well with people. Regardless of the economy, there will always be a housing market. The party I am referring to is the one being thrown by homeowners. When we see interest rates rise, the affordability factor for home buyers is reduced. When real estate is costlier to purchase, this puts a damper on prices and activity. But even with an increase in interest rates homeowners have another “dog that will hunt.” Supply. If there is one house available to purchase and 100 buyers, the price will stay elevated regardless of the mortgage interest rate being offered.
Supply. Supply. Supply. From what I can tell, real estate prices have topped out, regardless of supply, interest rates, the economy the presidency, the Mars landing. What will affect supply? More houses being placed on the market, or fewer buyers? From what I can tell we are going to see an increase, not a decrease, in interested home buyers. The only factor putting pressure on this is the "affordability factor." So now we have to look at new home construction.
Who remembers earlier housing booms that went bust? Do you believe that this will never happen again? We have seen a historical cycle of booms and busts over the last 100 years. Where do you think we are at in this current cycle? We are at the top. What do you do when you are holding an investment and the price is at the top? There are 2 ways of thinking. One is greed. “Hey, things are going so well, why would I want to sell if the price is going up and up and up?” This makes sense, until it does not. Two, the folks who know when to "ring the register." What did Warren Buffet say? "Sell when people are buying (market bubbles, froth, exuberance, greed) and buy when people are selling( fear, panic, sense of loss, herd mentality)."
So, what do you do if you need to buy a house at the market top due to a change in jobs, family events, relocation, or the need for a bigger house? #1. Find a quality Real Estate agent. #2. Get pre-qualified from a lending institution. Ask your Realtor who they work closely with. This is important. #3. Realize that you will have to "settle" on filling out your “wish list” checklist. #4. Be ready to pounce on a home you like the way Tom Brady was ready to pounce on the Chiefs during the Super Bowl. Was Tom Brady prepared? Did he have his "head in the game?" Did he have ALL of his "ducks in a row?" #5. Ask your Realtor about utilizing a "Multiple Offer Playbook." This will list up to 25 techniques that will ensure that you are not missing a thing, and that you are giving your absolute best. #6. Know your limits. i.e., what are you prequalified for in terms of price?
#7. Be comforted in knowing that although, historically, you are paying a high price for your new home, you are also buying the neighborhood, the town, the weather (if you like it), the surrounding amenities and finally, you are moving into a home that you love. All of a sudden, some of these important qualities become "priceless."
Tuesday, Feb 23
Airline, cruise stocks surge to start the week.
Investors can't keep up with economic optimism right now.
On Monday, the re-opening trade was on fire with shares of airlines, cruise lines, and banks all rallying. And this while Wall Street strategists continued raising full-year GDP forecasts as others reiterated calls that consensus estimates are still too conservative.
Which continues to show that for all of the optimism about 2021 that was anticipated by investors last year, folks are still playing catchup.
Travel stocks were the stars of the market show on Monday, with positive earnings commentary from Royal Caribbean (RCL) and an industry-wide upgrade of the airlines from Deutsche Bank analyst Michael Linenberg catalyzing the moves.
Royal Caribbean said pricing for its bookings for the second half of this year are trending higher than 2019, adding that 75% of bookings for 2021 are new reservations. Shares of Royal Caribbean gained 9.5%, while peers Carnival Cruise (CCL) and Norwegian Cruise Lines (NCLH) also rallied more than 5.5%.
Meanwhile, Linenberg's call on the airline industry sent American Airlines (AAL) shares up more than 9% while United (UAL), Delta (DAL), Southwest (LUV), and JetBlue (JBLU) all gained more than 3%.
NEWS!!
2 NEW CANNABIS COMPANIES
VERANO - VRNOF
CHOICE CONSOLIDATION (NO TICKER YET)
VERANO HOLDINGS VRNO (CSE) IPO on Canadian exchange Wednesday, February 17th.
"They said" shares would be available to trade on the OTC in about 3 weeks.
Good news, bad news.
Good news.
When the OTC ticker is available, the volatility of the share price will have modulated with 18 trading days under its belt. So, instead of buying at the initial IPO "pop" only to see the price wane after the initial surge, you will be buying at a "non-pumped" price.
Bad news.
You will miss out on 3 weeks of appreciation IF the markets love this company. For all intents and purposes, they will.
Initial est. valuation $32 US. (Came out around $23 - $24 U.S. $27 - $28 CA)
TRADING
A step-by-step explanation is the best way to illustrate the trading process. The example below is tailored for individual investors, although many of the same principles apply to institutional investors.
1. Investor Selects a Broker-Dealer — In order to execute a trade, an investor must have an account at a FINRA-registered broker-dealer.
2. Investor Makes an Investment Decision — Investment decisions should be based on thorough research on the company and security. For securities that trade on the OTCQX, OTCQB and Pink markets, investors can use www.otcmarkets.com to access the information companies have provided, including trade data and company news and financials to help facilitate an investment decision.
3. Investor Defines the Order — Investors define the order they wish the broker-dealer to handle. The two primary order types are Limit Order and Market Order.
o Limit Orders allow investors to specify the exact price they are willing to accept for a buy or sell order. While Limit Orders are designed to offer more price protection for investors, a Limit Order may not be executed if the price of the security does not reach the price stated in the Limit Order.
o Market Orders direct the broker-dealer to immediately execute either a buy or sell order at the current 'market price' — the best bid or offer.
Investors must decide whether price (Limit Order) or timing/immediacy (Market Order) is more important to them.
4. Broker-Dealer handling of the Order — Once a broker-dealer receives an order, it often goes through the following steps as part of the trading process:
o Execute Trade Internally — Broker-dealers will typically first determine if the order can be executed internally. Internal executions occur if they can 'match' (same prices for a buy and sell order) Limit Orders or if they provide liquidity against their own account. If they are trading for their own account, they generally must give investors the best available quoted price or better at that point in time. This rule is known as Best Execution and is among the regulations discussed in Part 3 - Regulation
o Trade Marketable Order Externally — If the broker-dealer cannot, or chooses not to, execute the trade internally they will attempt to execute the trade with another broker-dealer. OTC Link® ATS provides trading and messaging capabilities, which facilitates the process of ascertaining whether the order is marketable. Marketable orders are orders where the price specified can immediately be executed in the market. Market Orders are, by definition, marketable. Limit Orders are marketable if the limit price is less than or equal to the bid price (for sell orders) or greater than or equal to the ask price (for buy orders) (i.e., execution is at a price better than or equal to the limit price). For example, a customer's Limit Order to buy security ABCD for $30 will only be marketable if the offer/ask price is $30 or less. If the offer price is $30.01 or greater, then the limit order is not marketable and will not be executed. If the order is marketable, the broker-dealer may utilize OTC Link® ATS to negotiate a trade.
o Create/Edit Quote on OTC Link ATS — If the order is not marketable, the broker-dealer may be required to adjust its existing quote to reflect a new price or size. Broker-dealers are only required to update their quote if the price of the order is equal or superior to their existing quote (See FINRA Rule 6460 and Part 3 - Regulation). In many cases, a broker-dealer quote size represents an aggregation of a number of customer orders. Trade Non-Marketable Order Externally - Once a broker-dealer has a quote posted on OTC Link® ATS, they may receive a trade message via OTC Link® ATS from another broker-dealer; as the market changes, a broker-dealer with a standing quote may also initiate a trade message electronically. At that point, the broker-dealer may accept, decline or counter (send a different price or size) the offer to trade. The broker-dealers then negotiate trade price/size, one of the main differences between a trading a security off-exchange and trading a listed security. There is no central system that matches/executes orders for off-exchange traded securities — all trades are agreed upon directly between the broker-dealers. OTC Markets Group's trading platform, OTC Link® ATS, facilitates negotiated trading. Broker-dealers are required to be firm at their quote prices up to the sizes displayed. While broker-dealers may communicate by phone, one of the benefits of OTC Link® ATS is the ability for broker-dealers to trade and message electronically, creating a more efficient trading process.
Exchange Traded Fund (ETF) - Investopedia
An exchange traded fund (ETF) is a basket of securities(stocks) that trade on an exchange, just like a stock. ETF share prices fluctuate all day as the ETF is bought and sold; this is different from mutual funds that only trade once a day after the market closes.
'It’s the toughest time in the restaurant industry ... in the last 30 or 40 years': Celebrity chef Marcus Samuelsson
The Biden Presidency
It is not too late to take advantage of our new administration. Think “green.” Cannabis and renewable, clean energy. A new emphasis on climate change, environmental protection, etc.
https://www.greenprophet.com/
Stocks for the “Green Gold Rush”
The Industrial Revolution… The 1980s Computer Boom… The Internet of Things…
Throughout history, we have seen fortunes made, with market leaders rising on the back of new economic tailwinds. And it is not too late to get in on the next possible economic gamechanger sweeping the nation.
Take the potential of the Industrial Revolution and remove the soot-covered cities…
Investing in “green” companies could add some green to your bank account. And we are not just talking green tech—there are companies across sectors that are using sustainable, environmentally conscious principles to decrease their carbon footprint and increase their stock value.
Definitive List of Alternative Energy Equities ETFs
This is a list of all US-traded ETFs that are currently included in the Alternative Energy Equities ETFdb.com Category by the ETF Database staff. Each ETF is placed in a single “best fit” ETFdb.com Category.
ICLN
iShares Global Clean Energy ETF
TAN
Invesco Solar ETF
QCLN
First Trust NASDAQ Clean Edge Green Energy Index Fund
ACES
ALPS Clean Energy ETF
PZD
Invesco Cleantech™ ETF
FAN
First Trust ISE Global Wind Energy Index Fund
PBD
Invesco Global Clean Energy ETF
NRG
SPDR S&P Kensho Clean Power ETF
GRID
First Trust NASDAQ Clean Edge Smart Grid Infrastructure Index Fund
CANNABIS STOCKS TOP 10
My criteria;
#1. I like to see at least 100M in annual sales.
#2. I like to see an outstanding share number of less than 300M.
#3. The stock must have momentum. Especially right now.
#4. On the way to EBITDA break-even, if not there yet.
#5. Maybe a turnaround story, or legit, right out of the box.
#6. Typically, will be focused on the U.S., not Canada.
#7. For now, will be marijuana only. No hemp.
1) TILT TLLTF HOLD ADD ON SALE
2) High Tide HITIF HOLD ADD ON SALE
3) Columbia Care CCHWF HOLD ADD
4) Harvest Health HRVSF HOLD ADD ON SALE
5) 4Front FFNTF HOLD
6) CRESCO CRLBF SOLD ON SALE
7) Verano Holdings VRNOF NEW NO POSITION
8) TerrAscend TRSSF NO POSITION
9) AYR Resources AYRWF SOLD
10) Green Thumb GTBIF SOLD
11) HEXO HEXO SOLD
12) Schwazze SHWZ NO POSITION
13) Jushi JUSHF SOLD
14) Trulieve TCNNF NO POSITION
15) INDUS Holdings INDXF SOLD
16) HOLLISTER HSTRF SOLD
17) GrowGeneration GRWG NO POSITION
18) Curaleaf CURLF SOLD
19) TILRAY TLRY SOLD
20) TPCO Holding Inc GRAMF SOLD
TOP 5 TRACKING 03/08/2021
TILT $0.538 0.59
HIGHTIDE $0.568 0.615
COLUMBIA CARE $6.87 6.70
HARVEST HEALTH $3.50 3.26
4FRONT $1.496 1.42
TOTAL 03/08 12.972
TOTAL 3/16 12.585
Too late to find quality underpriced Cannabis stocks? But even the worst companies are increasing in value because the entire Cannabis sector is doing well.
Looking at the Cannabis SPACS right now. GRAMF and soon to come, Choice Consolidation.
EBITDA
What Are Earnings Before Interest, Taxes, Depreciation, and Amortization?
EBITDA, or earnings before interest, taxes, depreciation, and amortization, is a measure of a company's overall financial performance and is used as an alternative to net income in some circumstances. EBITDA, however, can be misleading because it strips out the cost of capital investments like property, plant, and equipment.
This metric also excludes expenses associated with debt by adding back interest expense and taxes to earnings. Nonetheless, it is a more precise measure of corporate performance since it is able to show earnings before the influence of accounting and financial deductions.
Simply put, EBITDA is a measure of profitability. While there is no legal requirement for companies to disclose their EBITDA, according to the U.S. generally accepted accounting principles (GAAP), it can be worked out and reported using the information found in a company's financial statements.
The earnings, tax, and interest figures are found on the income statement, while the depreciation and amortization figures are normally found in the notes to operating profit or on the cash flow statement. The usual shortcut to calculate EBITDA is to start with operating profit, also called earnings before interest and tax (EBIT) and then add back depreciation and amortization.
CANNABIS STOCK PICKs OF THE WEEK
High Tide
Indus Holdings
TILT
Hollister
4Front
Harvest Health
(It is getting harder to find undervalued MJ stocks)
Next quarter’s earnings release should boost both HEXO and Harvest Health
Bloomberg
With New Lobbying Clout, Big Pot Has Arrived: Cannabis Weekly
Big Alcohol and Big Tobacco have garnered a formidable reputation in the lobbying arena over the years. Big Pot is now looking for a piece...
Why Cannabis?
I have followed the Cannabis sector for over 7 years. There are now 3 solid reasons to look at the Cannabis sector in regard to your investment portfolio.
Number one - MOMENTUM
States are falling like dominos legalizing marijuana for recreational use. Throw in the Biden win, and this is a trend that cannot be stopped.
Number two - PROFITABILITY
cannabis companies are reporting net profitable quarters. Look what happened to Tesla when they reported their first profitable quarter. Two companies of note, Trulieve and Cresco.
Number three - The ARBITRAGE play (Buy Out)
American companies, wanting to partner with or purchase Cannabis companies, have to stay at arm’s length from Cannabis companies because marijuana is a schedule one substance (the most dangerous), and it is illegal federally.
When the fed loosens its grip and/or marijuana is legalized federally, BIG business will rush in to swoop up already established Cannabis companies at a premium. BIG tobacco, BIG liquor, BIG beverage, BIG pharmaceutical, BIG leisure, retail grocer, health food and nutritional companies.
BIG TOBACCO
BIG LIQUOR
BID RETAIL
BIG NUTRITION
BIG PHARMA
BIG BEVERAGE
BIG POT
MJ tailwinds
#1. State dominos are falling for legalization. Arizona. Florida next?
#2. First time House votes approvingly on legalizing marijuana.
#3. President and vice president-elect Biden and Harris are pro-cannabis.
#4. U.S. MSO's (Multi-state operators) are starting to report net profitable quarters.
#5. MOMO (momentum).
#6. Democrat control of the Senate.
How to Use Index Futures - Investopedia
The rise or fall in index futures outside of normal market hours is often used as an indication of whether the stock market will open higher or lower the next day. When index futures prices deviate too far from fair value, arbitrageurs deploy buy and sell programs in the stock market to profit from the difference.
FUTURES 2/15 Begin at 3:00pm on Sunday for Monday’s open
DOW +/-
NASDAQ +/-
Check on mobile app CNBC!
BEST REFERENCES
1. Smartphone app – “Yahoo Finance”
https://play.google.com/store/apps/details?id=com.yahoo.mobile.client.android.finance&hl=en
2. Investor Business Daily https://www.investors.com/
3.
4. www.otcmarkerts.com
5.
6. https://www.stockscores.com/charts
7.
8. Smartphone app – “Stocks Alert” by Milhomens Apps
https://appgrooves.com/android/cat.obiols.milhomens.BorsaValors/stock-alert-formula/milhomens-apps
9. Investors HUB https://investorshub.advfn.com/
Cannabis Investment Club
https://investorshub.advfn.com/Cannabis-Investment-Club-33161/
JohnCM Investment Corner
https://investorshub.advfn.com/JohnCM-Investment-Corner-37729/
I have known of this following discipline for 30+ years, but rarely used it, UNTIL NOW!
"Trading around a core position"
You own 100 shares of ABC Inc.
You have the smartphone app STOCKS ALERT setup on your phone with your portfolio. All of your stocks are monitored for RSI(14) oversold (30) and overbought (70) levels. As well as (20), (80), (60).
When ABC Inc. flashes the RSI(14) 80 threshold has been reached, I sell 33 shares. When the stock flashes (60), I either, pocket the extra CASH, or buy 33 plus shares.
This Stock Investment Newsletter is free to enjoy.
I also have available my “live” version of the newsletter that includes my “real time” trades (buys and sells), portfolio positions and immediate “stock tips.”
If you wait 7 days to act on one of my recommendations, that is an eternity of time in the investment world. Stocks can move 5%, 10% or more, in a single day, let alone 5 trading days.
To take a peek at my “live” newsletter version, click here
https://johncmueller.com/stock-investment-newsletter/
DISCLAIMER
John Mueller (The Charles Report) is not a licensed financial, income tax advisor, stockbroker, or licensed real estate agent (almost!). All investment/financial opinions expressed by John Mueller are from personal research and 35 years investing experience and are intended as educational material only. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur. Purchase and sell real estate and stocks at your own risk.
STOCK INVESTMENT NEWSLETTER
March 16th, 2021 no.114
ZOOM meetings 5:00pm PST Saturdays every 2 weeks
Next meeting March 27th
https://www.meetup.com/stock-market-investing/
https://investorshub.advfn.com/JohnCM-Investment-Corner-37729/
https://investorshub.advfn.com/Cannabis-Investment-Club-33161/
The Charles Report
Feature TILT Holdings OTC QX TLLTF
$0.5689
March 9th, 2021
TILT helps cannabis businesses build brands. Through a portfolio of companies providing technology, hardware, cultivation and production, TILT services brands and cannabis retailers across 35 states in the U.S., as well as Canada, Israel, Mexico, South America and the European Union. TILT’s core businesses include Jupiter Research, LLC, a wholly owned subsidiary and leader in the vaporization segment focused on hardware design, research, development and manufacturing, and cannabis operations Commonwealth Alternative Care, Inc. in Massachusetts and Standard Farms, LLC in Pennsylvania. TILT is headquartered in Phoenix, Arizona.
Outstanding Shares 323,756,294 03/02/2021
TILT Holdings Provides Preliminary Fourth Quarter Results, Operational Highlights and 2021 Outlook 02/17/2021
Jupiter Q4 2020 revenues return to pre-COVID levels
Standard Farms extraction capacity increased by 100% during Q4 2020
CAC lab and kitchen production capacity increased by 100% during Q4 2020
Projected Preliminary Financial Highlights:
• Q4 2020 revenue is projected to be between $42.2 million and $43.2 million, compared to Q3 2020 revenue of $40.4 million
• Q4 2020 Adjusted EBITDA is projected to be between $2.6 million and $3.6 million, compared to Q3 2020 Adjusted EBITDA of $2.8 million
• Pro-forma Q4 2020 revenue excluding the Company’s former subsidiary, Blackbird, is projected to be between $41.3 million and $42.3 million, compared to Q3 2020 pro-forma revenue of $39.1 million
• Pro-forma Q4 2020 Adjusted EBITDA excluding the Company’s former subsidiary, Blackbird, is projected to be between $4.6 million and $5.6 million, compared to Q3 2020 pro-forma Adjusted EBITDA of $5.4 million
• $7.4 million cash balance as of Dec. 31, 2020, compared to $4.3 million at Sept. 30, 2020
Fourth Quarter 2020 Operational Highlights:
• Jupiter Research LLC’s (“Jupiter”) power supply revenue doubled from Q3 2020 to Q4 2020; revenues during the quarter reached pre-COVID levels
• Commonwealth Alternative Care, Inc.’s (“CAC”) lab and kitchen production capacity increased 100% during the quarter; cultivation expansion approved October 2020 planted during Q4 2020 and expected to yield first harvest in March 2021
• Standard Farms, LLC (“Standard Farms”) doubled extraction processing capacity during the quarter; introduced six new manufactured product offerings
Full Year 2021 Outlook:
2021 strategic initiatives fully funded; outlook not expected to require significant CAPEX or M&A.
• Revenue range of $205 million to $210 million
• Adjusted EBITDA range of $30 million to $32 million
TILT Holdings Reports Third Quarter 2020 Financial Results Including Record Adjusted EBITDA, Enters into Definitive Agreement for the Sale of Blackbird Subsidiary 11/18/2020
Revenue of $40.4 million, driven in part by a 24% sequential increase in the cannabis segment compared to the second quarter of 2020
Gross margin of 30.3%, a 193-basis point improvement from the second quarter of 2020, driven by margin expansion in the cannabis segment
Record adjusted EBITDA of $2.8 million, an increase of 134% from the second quarter of 2020
Upon closing, Blackbird divestiture reduces cash burn, improves third quarter 2020 adjusted EBITDA by 96% on a pro-forma basis
Financial Summary for the Quarter Ended September 30, 2020
• Revenue of $40.4 million, a 5% increase from the second quarter of 2020 and a decline of 12% from the prior year period.
• Gross margin1 of 30.3%, up 193 basis points (“bps”) from the second quarter of 2020 and up 8 bps from the prior year period.
• Positive adjusted EBITDA for the third consecutive quarter at $2.8 million, a 134% increase from the second quarter of 2020, and a 3% increase from the prior year period.
• Excluding the impact of Blackbird, pro-forma adjusted EBITDA of $5.4 million for the second quarter of 2020 and $12.7 million year to date.
• Net loss ($4,617,000)
• Cash and cash equivalents of $4.3 million, a decline from the previous quarter $10.5 million as of June 30, 2020 due, in part, to additional inventory required to fulfill increasing orders.
“The Reddit Hangover”
Mark this date down on your calendar, February 10th, 2021. This date marks the “blow off top”, the exuberant top”, the “frenzied froth”, the “bubble before bursting.” Typically, if you are participating in this type of upward move in your portfolio, you are drunk with greed. You are envisioning that trip to Rarotonga Island. The last thing you are going to do is sell! Are you crazy!? Why would I sell when my stocks are doing so well? I am a financial genius!
Well, this is exactly the time to sell. But, I am a big fan of “leveraging” in and out. Typically, I do not take 100% of the monies allocated to buy a stock or my entire position in a stock, and buy or sell it. Maybe 33 percent, depending? Maybe more, maybe less. If you are a frozen statue when the time is right to sell RSI 80 or buy RSI 20, take 10 or 20 percent and trade around your position. Get a feel for it.
Back to the “Reddit Rush.” When momentum, fan boys, greedy bastards, pump and dumpers control the market, they will push it north as hard and fast as they can. What does this action have to do with each individual company’s prospects or the long term view of the sector of interest? Nothing. So, you react to what “the market is telling you.” On February 10th the market was telling you to sell 50% of your position, give or take. Trade around a core position. If your stock continued to spike, no worries, you still have your 50%. But if the bubble pops, you are not riding 100 percent of your position all the way back down. Poof! There goes your trip to Rarotonga.
In A Related Story
After the February 10th blowoff top, we finally reversed down to a climax low last Friday morning. This is the low for most Cannabis stocks as we ride thru the rest of 2021.
Cannabis EFT MJ Feb 10th $34.50 March 5th $19.50 Current $23.03
Harvest Health & Recreation Inc. (HRVSF)
Founded in 2011, HRVSF is involved in the cultivation, processing, and selling of cannabis in the United States. It offers cannabis oil, capsules, tinctures, and cannabis product edibles under the Roll One, Modern Flower, Evolab brands, among others. The company also operates retail dispensaries that sell cannabis products to patients and customers.
Last month, HRVSF completed the divestiture of its two medical marijuana dispensary assets in North Dakota as a part of its strategic plan to allocate resources in core markets to further enhance growth opportunities.
In January, it launched recreational cannabis sales in Arizona. HRVSF registered its first sale as it began offering access to regulated and legal cannabis products to serve both medical patients and recreational customers across the state.
HRVSF’s total revenue increased 86% year-over-year to $61.64 million in the third quarter, ended September 30, 2020. Its gross profit grew 222.7% from the year-ago value to $38.33 million, while its adjusted EBITDA rose 156.1% sequentially to $10.5 million over this period. The company’s gross profit margin, excluding biological adjustments, in the third quarter was 46.6%, compared to 35.0% in the third quarter of 2019.
A consensus EPS estimate for fiscal 2021 represents a 158.3% improvement year-over-year. The consensus revenue estimate of $378.07 million for the current year represents a 65.3% increase from the same period last year. The stock has gained 97.6% over the past year.
Of the four Wall Street analysts that provided ratings for the stock, three have rated it “Buy.” Also, the consensus price target of $5.71 represents a potential upside of 47.1%.
PUMP CITY! TILT HOLDINGS
Here we come.
Looking for RSI(14) 80+
What Is the Relative Strength Index (RSI)?
The relative strength index (RSI) is a momentum indicator used in technical analysis that measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock or other asset. The RSI is displayed as an oscillator (a line graph that moves between two extremes) and can have a reading from 0 to 100. The indicator was originally developed by J. Welles Wilder Jr. and introduced in his seminal 1978 book, "New Concepts in Technical Trading Systems."
Traditional interpretation and usage of the RSI are that values of 70 or above indicate that a security is becoming overbought or overvalued and may be primed for a trend reversal or corrective pullback in price. An RSI reading of 30 or below indicates an oversold or undervalued condition.
KEY TAKEAWAYS
The relative strength index (RSI) is a popular momentum oscillator developed in 1978.
The RSI provides technical traders signals about bullish and bearish price momentum, and it is often plotted beneath the graph of an asset's price.
An asset is usually considered overbought when the RSI is above 70% and oversold when it is below 30%.
Relative Strength Index (RSI)
The Formula for RSI
The relative strength index (RSI) is computed with a two-part calculation that starts with the following formula:
The average gain or loss used in the calculation is the average percentage gain or loss during a look-back period. The formula uses a positive value for the average loss.
The standard is to use 14 periods to calculate the initial RSI value. For example, imagine the market closed higher seven out of the past 14 days with an average gain of 1%. The remaining seven days all closed lower with an average loss of -0.8%. The calculation for the first part of the RSI would look like the following expanded calculation:
Once there are 14 periods of data available, the second part of the RSI formula can be calculated. The second step of the calculation smooths the results.
Calculation of the RSI
Using the formulas above, RSI can be calculated, where the RSI line can then be plotted beneath an asset's price chart.
The RSI will rise as the number and size of positive closes increase, and it will fall as the number and size of losses increase. The second part of the calculation smooths the result, so the RSI will only near 100 or 0 in a strongly trending market.
The RSI indicator can stay in the overbought region for extended periods while the stock is in an uptrend. The indicator may also remain in oversold territory for a long time when the stock is in a downtrend. This can be confusing for new analysts, but learning to use the indicator within the context of the prevailing trend will clarify these issues.
What Does RSI Tell You?
The primary trend of the stock or asset is an important tool in making sure the indicator's readings are properly understood. For example, well-known market technician Constance Brown, CMT, has promoted the idea that an oversold reading on the RSI in an uptrend is likely much higher than 30%, and an overbought reading on the RSI during a downtrend is much lower than the 70% level.
During a downtrend, the RSI would peak near the 50% level rather than 70%, which could be used by investors to more reliably signal bearish conditions. Many investors will apply a horizontal trendline that is between 30% and 70% levels when a strong trend is in place to better identify extremes. Modifying overbought or oversold levels when the price of a stock or asset is in a long-term, horizontal channel is usually unnecessary.
A related concept to using overbought or oversold levels appropriate to the trend is to focus on trading signals and techniques that conform to the trend. In other words, using bullish signals when the price is in a bullish trend and bearish signals when a stock is in a bearish trend will help to avoid the many false alarms the RSI can generate.
Exchange Traded Funds - Inverse/Bear - Real Estate
Proshares Ultrashort 2X Real Estate SRS
$11.98 52-week high $39.56 Mar 12
ProShares Short 1X Real Estate REK
$11.21 52-week high $19.63 Mar 12
Direxion Daily MSCI Real Estate Bear 3X Shares DRV
$9.19 52-week high $71.04 Mar 12
SPAC Stock Of The Week!
THBR
U.S. Nasdaq
Thunder Bridge Acquisition II Ltd. Cl A
About indie
indie is empowering the Autotech revolution with next generation automotive semiconductors and software platforms. We focus on edge sensors for Advanced Driver Assistance Systems including LiDAR, connected car, user experience and electrification applications. These technologies represent the core underpinnings of both electric and autonomous vehicles, while the advanced user interfaces transform the in-cabin experience to mirror and seamlessly connect to the mobile platforms we rely on every day. We are an approved vendor to Tier 1 partners and our solutions can be found in marquee automotive OEMs around the world. Headquartered in Aliso Viejo, CA, indie has design centers and sales offices in Austin, TX; Boston, MA; Detroit, MI; San Francisco and San Jose, CA; Budapest, Hungary; Dresden, Germany; Edinburgh, Scotland and various locations throughout China.
Please visit us at www.indiesemi.com to learn more.
Thunder Bridge Acquisition II started at buy with $17 stock price target at Benchmark. Mar. 9, 2021
EMERGENCY
INDUS HOLDINGS INDXF
$1.92(SOLD)
BUY TILT TLLTF
$0.545 ($0.50, $0.54, $0.5689)
Trading Secret #4
This technique has taken me 35 years to get right.
Download the smartphone app "Stocks Alert."
Pick a percentage of your total shares in your position that you will use to trade around your core position. 33 percent?
Set the RSI(14) alert to 80.
When 80 is triggered, sell 33 percent.
Buyback at 60 and either pocket the cash difference or buy back more shares than you sold.
INTEREST RATES
Hmmm, how do interest rates affect me? And why do they increase? (Or rather why does the FED increase interest rates?) Is it simply supply and demand? In a way, yes. The primary motivation for the increase in interest rates is to keep inflation from rising. What increases inflation? Demand. What is the result of inflation? Higher price tags for everything you spend your money on. Services, goods, travel, food, housing, fuel, clothing, luxury items, etc.
So, if the FED is keeping an eye on inflation, why do I need to pay attention to interest rates? All depends. Do you have any investments in Real Estate or in the Stock Market? Hopefully, by now, most folks have converted their ARM mortgage into fixed rate. In that case, a higher interest rate on your mortgage is not a worry.
How about the stock market? You would think that a recovering economy would help buoy the markets, right? Yes, to a limit. The market is typically 6 months forward looking. So, your stocks have already priced in where economists expect the U.S. to be on August 1st, 2021. When interest rates increase, so do the number of alternative, safer vehicles to earn interest/dividends/capital gains on your stock market investment. When there are more, safer alternatives, they are fewer buyers of company stock as an investment.
I should add here, as a rule, precious metals should take up a 5% position in your portfolio. Individual miners, ETF (long/inverse/ leveraged 1X 2X 3X), or simple bullion.
Getting back to the stock market. The markets right now are priced to perfection. Any seismic shift will send the DOW lower. A 10 percent decline is still not out of the equation. Seismic shift? World events i.e., saber rattling from a communist country. Nuclear arms concerns. Higher interest rates. A major setback in the fight against COVID-19, to name a few.
When you see a meaningful increase in interested rates, and as I mentioned earlier, the trend is beginning right now, you want to have a defensive game plan in regard to your stock positions. (Not so much mutual funds. You have professionals baby-sitting those for you). There are a number of ways you can prepare for future pressures on the stock market. Look for sector niches that will benefit from the recovering economy. Use ETF funds for this. Set stop limit orders to protect your gains (you do not want to give them all back). Look to inverse ETF (bear) funds. Precious metals. CASH.
Getting back to Real Estate. I hate to say it BUT the party will not last forever. This is not directed to quality Real Estate agents who always flourish because of their elevated marketing skills and their ability to work well with people. Regardless of the economy, there will always be a housing market. The party I am referring to is the one being thrown by homeowners. When we see interest rates rise, the affordability factor for home buyers is reduced. When real estate is costlier to purchase, this puts a damper on prices and activity. But even with an increase in interest rates homeowners have another “dog that will hunt.” Supply. If there is one house available to purchase and 100 buyers, the price will stay elevated regardless of the mortgage interest rate being offered.
Supply. Supply. Supply. From what I can tell, real estate prices have topped out, regardless of supply, interest rates, the economy the presidency, the Mars landing. What will affect supply? More houses being placed on the market, or fewer buyers? From what I can tell we are going to see an increase, not a decrease, in interested home buyers. The only factor putting pressure on this is the "affordability factor." So now we have to look at new home construction.
Who remembers earlier housing booms that went bust? Do you believe that this will never happen again? We have seen a historical cycle of booms and busts over the last 100 years. Where do you think we are at in this current cycle? We are at the top. What do you do when you are holding an investment and the price is at the top? There are 2 ways of thinking. One is greed. “Hey, things are going so well, why would I want to sell if the price is going up and up and up?” This makes sense, until it does not. Two, the folks who know when to "ring the register." What did Warren Buffet say? "Sell when people are buying (market bubbles, froth, exuberance, greed) and buy when people are selling( fear, panic, sense of loss, herd mentality)."
So, what do you do if you need to buy a house at the market top due to a change in jobs, family events, relocation, or the need for a bigger house? #1. Find a quality Real Estate agent. #2. Get pre-qualified from a lending institution. Ask your Realtor who they work closely with. This is important. #3. Realize that you will have to "settle" on filling out your “wish list” checklist. #4. Be ready to pounce on a home you like the way Tom Brady was ready to pounce on the Chiefs during the Super Bowl. Was Tom Brady prepared? Did he have his "head in the game?" Did he have ALL of his "ducks in a row?" #5. Ask your Realtor about utilizing a "Multiple Offer Playbook." This will list up to 25 techniques that will ensure that you are not missing a thing, and that you are giving your absolute best. #6. Know your limits. i.e., what are you prequalified for in terms of price?
#7. Be comforted in knowing that although, historically, you are paying a high price for your new home, you are also buying the neighborhood, the town, the weather (if you like it), the surrounding amenities and finally, you are moving into a home that you love. All of a sudden, some of these important qualities become "priceless."
Tuesday, Feb 23
Airline, cruise stocks surge to start the week.
Investors can't keep up with economic optimism right now.
On Monday, the re-opening trade was on fire with shares of airlines, cruise lines, and banks all rallying. And this while Wall Street strategists continued raising full-year GDP forecasts as others reiterated calls that consensus estimates are still too conservative.
Which continues to show that for all of the optimism about 2021 that was anticipated by investors last year, folks are still playing catchup.
Travel stocks were the stars of the market show on Monday, with positive earnings commentary from Royal Caribbean (RCL) and an industry-wide upgrade of the airlines from Deutsche Bank analyst Michael Linenberg catalyzing the moves.
Royal Caribbean said pricing for its bookings for the second half of this year are trending higher than 2019, adding that 75% of bookings for 2021 are new reservations. Shares of Royal Caribbean gained 9.5%, while peers Carnival Cruise (CCL) and Norwegian Cruise Lines (NCLH) also rallied more than 5.5%.
Meanwhile, Linenberg's call on the airline industry sent American Airlines (AAL) shares up more than 9% while United (UAL), Delta (DAL), Southwest (LUV), and JetBlue (JBLU) all gained more than 3%.
NEWS!!
2 NEW CANNABIS COMPANIES
VERANO - VRNOF
CHOICE CONSOLIDATION (NO TICKER YET)
VERANO HOLDINGS VRNO (CSE) IPO on Canadian exchange Wednesday, February 17th.
"They said" shares would be available to trade on the OTC in about 3 weeks.
Good news, bad news.
Good news.
When the OTC ticker is available, the volatility of the share price will have modulated with 18 trading days under its belt. So, instead of buying at the initial IPO "pop" only to see the price wane after the initial surge, you will be buying at a "non-pumped" price.
Bad news.
You will miss out on 3 weeks of appreciation IF the markets love this company. For all intents and purposes, they will.
Initial est. valuation $32 US. (Came out around $23 - $24 U.S. $27 - $28 CA)
TRADING
A step-by-step explanation is the best way to illustrate the trading process. The example below is tailored for individual investors, although many of the same principles apply to institutional investors.
1. Investor Selects a Broker-Dealer — In order to execute a trade, an investor must have an account at a FINRA-registered broker-dealer.
2. Investor Makes an Investment Decision — Investment decisions should be based on thorough research on the company and security. For securities that trade on the OTCQX, OTCQB and Pink markets, investors can use www.otcmarkets.com to access the information companies have provided, including trade data and company news and financials to help facilitate an investment decision.
3. Investor Defines the Order — Investors define the order they wish the broker-dealer to handle. The two primary order types are Limit Order and Market Order.
o Limit Orders allow investors to specify the exact price they are willing to accept for a buy or sell order. While Limit Orders are designed to offer more price protection for investors, a Limit Order may not be executed if the price of the security does not reach the price stated in the Limit Order.
o Market Orders direct the broker-dealer to immediately execute either a buy or sell order at the current 'market price' — the best bid or offer.
Investors must decide whether price (Limit Order) or timing/immediacy (Market Order) is more important to them.
4. Broker-Dealer handling of the Order — Once a broker-dealer receives an order, it often goes through the following steps as part of the trading process:
o Execute Trade Internally — Broker-dealers will typically first determine if the order can be executed internally. Internal executions occur if they can 'match' (same prices for a buy and sell order) Limit Orders or if they provide liquidity against their own account. If they are trading for their own account, they generally must give investors the best available quoted price or better at that point in time. This rule is known as Best Execution and is among the regulations discussed in Part 3 - Regulation
o Trade Marketable Order Externally — If the broker-dealer cannot, or chooses not to, execute the trade internally they will attempt to execute the trade with another broker-dealer. OTC Link® ATS provides trading and messaging capabilities, which facilitates the process of ascertaining whether the order is marketable. Marketable orders are orders where the price specified can immediately be executed in the market. Market Orders are, by definition, marketable. Limit Orders are marketable if the limit price is less than or equal to the bid price (for sell orders) or greater than or equal to the ask price (for buy orders) (i.e., execution is at a price better than or equal to the limit price). For example, a customer's Limit Order to buy security ABCD for $30 will only be marketable if the offer/ask price is $30 or less. If the offer price is $30.01 or greater, then the limit order is not marketable and will not be executed. If the order is marketable, the broker-dealer may utilize OTC Link® ATS to negotiate a trade.
o Create/Edit Quote on OTC Link ATS — If the order is not marketable, the broker-dealer may be required to adjust its existing quote to reflect a new price or size. Broker-dealers are only required to update their quote if the price of the order is equal or superior to their existing quote (See FINRA Rule 6460 and Part 3 - Regulation). In many cases, a broker-dealer quote size represents an aggregation of a number of customer orders. Trade Non-Marketable Order Externally - Once a broker-dealer has a quote posted on OTC Link® ATS, they may receive a trade message via OTC Link® ATS from another broker-dealer; as the market changes, a broker-dealer with a standing quote may also initiate a trade message electronically. At that point, the broker-dealer may accept, decline or counter (send a different price or size) the offer to trade. The broker-dealers then negotiate trade price/size, one of the main differences between a trading a security off-exchange and trading a listed security. There is no central system that matches/executes orders for off-exchange traded securities — all trades are agreed upon directly between the broker-dealers. OTC Markets Group's trading platform, OTC Link® ATS, facilitates negotiated trading. Broker-dealers are required to be firm at their quote prices up to the sizes displayed. While broker-dealers may communicate by phone, one of the benefits of OTC Link® ATS is the ability for broker-dealers to trade and message electronically, creating a more efficient trading process.
Exchange Traded Fund (ETF) - Investopedia
An exchange traded fund (ETF) is a basket of securities(stocks) that trade on an exchange, just like a stock. ETF share prices fluctuate all day as the ETF is bought and sold; this is different from mutual funds that only trade once a day after the market closes.
'It’s the toughest time in the restaurant industry ... in the last 30 or 40 years': Celebrity chef Marcus Samuelsson
The Biden Presidency
It is not too late to take advantage of our new administration. Think “green.” Cannabis and renewable, clean energy. A new emphasis on climate change, environmental protection, etc.
https://www.greenprophet.com/
Stocks for the “Green Gold Rush”
The Industrial Revolution… The 1980s Computer Boom… The Internet of Things…
Throughout history, we have seen fortunes made, with market leaders rising on the back of new economic tailwinds. And it is not too late to get in on the next possible economic gamechanger sweeping the nation.
Take the potential of the Industrial Revolution and remove the soot-covered cities…
Investing in “green” companies could add some green to your bank account. And we are not just talking green tech—there are companies across sectors that are using sustainable, environmentally conscious principles to decrease their carbon footprint and increase their stock value.
Definitive List of Alternative Energy Equities ETFs
This is a list of all US-traded ETFs that are currently included in the Alternative Energy Equities ETFdb.com Category by the ETF Database staff. Each ETF is placed in a single “best fit” ETFdb.com Category.
ICLN
iShares Global Clean Energy ETF
TAN
Invesco Solar ETF
QCLN
First Trust NASDAQ Clean Edge Green Energy Index Fund
ACES
ALPS Clean Energy ETF
PZD
Invesco Cleantech™ ETF
FAN
First Trust ISE Global Wind Energy Index Fund
PBD
Invesco Global Clean Energy ETF
NRG
SPDR S&P Kensho Clean Power ETF
GRID
First Trust NASDAQ Clean Edge Smart Grid Infrastructure Index Fund
CANNABIS STOCKS TOP 10
My criteria;
#1. I like to see at least 100M in annual sales.
#2. I like to see an outstanding share number of less than 300M.
#3. The stock must have momentum. Especially right now.
#4. On the way to EBITDA break-even, if not there yet.
#5. Maybe a turnaround story, or legit, right out of the box.
#6. Typically, will be focused on the U.S., not Canada.
#7. For now, will be marijuana only. No hemp.
1) TILT TLLTF HOLD ADD ON SALE
2) High Tide HITIF HOLD ADD ON SALE
3) Columbia Care CCHWF HOLD ADD
4) Harvest Health HRVSF HOLD ADD ON SALE
5) 4Front FFNTF HOLD
6) CRESCO CRLBF SOLD ON SALE
7) Verano Holdings VRNOF NEW NO POSITION
8) TerrAscend TRSSF NO POSITION
9) AYR Resources AYRWF SOLD
10) Green Thumb GTBIF SOLD
11) HEXO HEXO SOLD
12) Schwazze SHWZ NO POSITION
13) Jushi JUSHF SOLD
14) Trulieve TCNNF NO POSITION
15) INDUS Holdings INDXF SOLD
16) HOLLISTER HSTRF SOLD
17) GrowGeneration GRWG NO POSITION
18) Curaleaf CURLF SOLD
19) TILRAY TLRY SOLD
20) TPCO Holding Inc GRAMF SOLD
TOP 5 TRACKING 03/08/2021
TILT $0.538 0.59
HIGHTIDE $0.568 0.615
COLUMBIA CARE $6.87 6.70
HARVEST HEALTH $3.50 3.26
4FRONT $1.496 1.42
TOTAL 03/08 12.972
TOTAL 3/16 12.585
Too late to find quality underpriced Cannabis stocks? But even the worst companies are increasing in value because the entire Cannabis sector is doing well.
Looking at the Cannabis SPACS right now. GRAMF and soon to come, Choice Consolidation.
EBITDA
What Are Earnings Before Interest, Taxes, Depreciation, and Amortization?
EBITDA, or earnings before interest, taxes, depreciation, and amortization, is a measure of a company's overall financial performance and is used as an alternative to net income in some circumstances. EBITDA, however, can be misleading because it strips out the cost of capital investments like property, plant, and equipment.
This metric also excludes expenses associated with debt by adding back interest expense and taxes to earnings. Nonetheless, it is a more precise measure of corporate performance since it is able to show earnings before the influence of accounting and financial deductions.
Simply put, EBITDA is a measure of profitability. While there is no legal requirement for companies to disclose their EBITDA, according to the U.S. generally accepted accounting principles (GAAP), it can be worked out and reported using the information found in a company's financial statements.
The earnings, tax, and interest figures are found on the income statement, while the depreciation and amortization figures are normally found in the notes to operating profit or on the cash flow statement. The usual shortcut to calculate EBITDA is to start with operating profit, also called earnings before interest and tax (EBIT) and then add back depreciation and amortization.
CANNABIS STOCK PICKs OF THE WEEK
High Tide
Indus Holdings
TILT
Hollister
4Front
Harvest Health
(It is getting harder to find undervalued MJ stocks)
Next quarter’s earnings release should boost both HEXO and Harvest Health
Bloomberg
With New Lobbying Clout, Big Pot Has Arrived: Cannabis Weekly
Big Alcohol and Big Tobacco have garnered a formidable reputation in the lobbying arena over the years. Big Pot is now looking for a piece...
Why Cannabis?
I have followed the Cannabis sector for over 7 years. There are now 3 solid reasons to look at the Cannabis sector in regard to your investment portfolio.
Number one - MOMENTUM
States are falling like dominos legalizing marijuana for recreational use. Throw in the Biden win, and this is a trend that cannot be stopped.
Number two - PROFITABILITY
cannabis companies are reporting net profitable quarters. Look what happened to Tesla when they reported their first profitable quarter. Two companies of note, Trulieve and Cresco.
Number three - The ARBITRAGE play (Buy Out)
American companies, wanting to partner with or purchase Cannabis companies, have to stay at arm’s length from Cannabis companies because marijuana is a schedule one substance (the most dangerous), and it is illegal federally.
When the fed loosens its grip and/or marijuana is legalized federally, BIG business will rush in to swoop up already established Cannabis companies at a premium. BIG tobacco, BIG liquor, BIG beverage, BIG pharmaceutical, BIG leisure, retail grocer, health food and nutritional companies.
BIG TOBACCO
BIG LIQUOR
BID RETAIL
BIG NUTRITION
BIG PHARMA
BIG BEVERAGE
BIG POT
MJ tailwinds
#1. State dominos are falling for legalization. Arizona. Florida next?
#2. First time House votes approvingly on legalizing marijuana.
#3. President and vice president-elect Biden and Harris are pro-cannabis.
#4. U.S. MSO's (Multi-state operators) are starting to report net profitable quarters.
#5. MOMO (momentum).
#6. Democrat control of the Senate.
How to Use Index Futures - Investopedia
The rise or fall in index futures outside of normal market hours is often used as an indication of whether the stock market will open higher or lower the next day. When index futures prices deviate too far from fair value, arbitrageurs deploy buy and sell programs in the stock market to profit from the difference.
FUTURES 2/15 Begin at 3:00pm on Sunday for Monday’s open
DOW +/-
NASDAQ +/-
Check on mobile app CNBC!
BEST REFERENCES
1. Smartphone app – “Yahoo Finance”
https://play.google.com/store/apps/details?id=com.yahoo.mobile.client.android.finance&hl=en
2. Investor Business Daily https://www.investors.com/
3.
4. www.otcmarkerts.com
5.
6. https://www.stockscores.com/charts
7.
8. Smartphone app – “Stocks Alert” by Milhomens Apps
https://appgrooves.com/android/cat.obiols.milhomens.BorsaValors/stock-alert-formula/milhomens-apps
9. Investors HUB https://investorshub.advfn.com/
Cannabis Investment Club
https://investorshub.advfn.com/Cannabis-Investment-Club-33161/
JohnCM Investment Corner
https://investorshub.advfn.com/JohnCM-Investment-Corner-37729/
I have known of this following discipline for 30+ years, but rarely used it, UNTIL NOW!
"Trading around a core position"
You own 100 shares of ABC Inc.
You have the smartphone app STOCKS ALERT setup on your phone with your portfolio. All of your stocks are monitored for RSI(14) oversold (30) and overbought (70) levels. As well as (20), (80), (60).
When ABC Inc. flashes the RSI(14) 80 threshold has been reached, I sell 33 shares. When the stock flashes (60), I either, pocket the extra CASH, or buy 33 plus shares.
This Stock Investment Newsletter is free to enjoy.
I also have available my “live” version of the newsletter that includes my “real time” trades (buys and sells), portfolio positions and immediate “stock tips.”
If you wait 7 days to act on one of my recommendations, that is an eternity of time in the investment world. Stocks can move 5%, 10% or more, in a single day, let alone 5 trading days.
To take a peek at my “live” newsletter version, click here
https://johncmueller.com/stock-investment-newsletter/
DISCLAIMER
John Mueller (The Charles Report) is not a licensed financial, income tax advisor, stockbroker, or licensed real estate agent (almost!). All investment/financial opinions expressed by John Mueller are from personal research and 35 years investing experience and are intended as educational material only. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur. Purchase and sell real estate and stocks at your own risk.
Cannabis Investment Club
https://investorshub.advfn.com/Cannabis-Investment-Club-33161/
JohnCM Investment Corner
https://investorshub.advfn.com/JohnCM-Investment-Corner-37729/
Join the InvestorsHub Community
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
