The Morning Blunt
Volume 1| Issue 25
September 25, 2018
“Don’t worry about being successful but work toward being significant and the success will naturally follow.”
Buying Tilray Is Pure Speculation
Buying Tilray might be more like gambling. Take a look at what Andrew McCreath had to say about cannabis investments.
According to The Wall Street Journal, the enthusiasm around the cannabis industry is reminiscent of the dot com boom. Many cannabis stocks are through the roof concerning analysts. Of the top offenders are Tilray and Canopy.
Aurora capped it’s year with it’s revenues tripling to $19.1M in their fourth quarter. Many things attributed to their spectacular year including several acquisitions, automation bringing costs down, doubling their patient list, and announcing their intention to list on the US stock exchange.
Nearly a dozen US cannabis firms are going public on Canadian stock exchanges. Among them are Curaleaf Inc, Harvest Enterprises, Columbia Care, and Acreage Holdings. Most cannabis firms are going the route of reverse takeover of a publicly traded shell corporations to expedite the filing process. With the US regulations behind on legalization and US consumption is expected to be worth $6B, it’s only logical that firms would look to Canada for trade.
Flowr Corporation, a Canadian vertically integrated cannabis firm announced they will begin trading on the TSXV Wednesday. The company became an IPO through reverse takeover of The Needle Capital Corp. allowing them to skip the filing process. In the future Flowr hopes to go public in the US.
With companies like Tilray soaring in the clouds, here are four tips for those looking to invest in the cannabis industry. Excess liquidity in the system encourages new bubbles, cannabis is a commodity, it takes time and money to have a product FDA approved, and over supply of hot new stocks will saturate the market.
Keith Speights of Motley Fool argues that the three biggest cannabis stocks to invest in are Scott’s Miracle-Gro, MedMen Enterprises, and MariMed. While MedMen and MariMed have yet to turn a profit, Scott’s Miracle-Gro has a lawn and garden aspect that helps stabilize it’s profit margins.
There’s a big difference between Tilray and other pot stocks. Tim Seymour discusses how pot stocks are burning short sellers and why investors are concerned at Tilray’s volatility and dramatic drop from last week.
Jonathan Cooper of Seeking Alpha analyzes the top five cannabis producers and believes Aphria is the strongest buy. Aphria has more supply agreements across all provinces than any other producer. Aphria boasts a clear balance sheet and enough capital to scale their firm. Of the five, Aphria is also a cheaper buy.
With limited stock options, European investors are waiting for the opportunity to place investments on cannabis, a market that could eventually be worth $25B euros. With hope of legalization to take the continent, a more short term goal is to bring and bolster a strong medical industry to Europe.
On Friday Danish cannabis firm STENOCARE announced that it will be going public on the Spotlight Stock Market exchange. The company intends to be the first European cannabis IPO. With strict regulations abroad loosening, European cannabis markets are estimated to be worth $25B euros.
Matt Gaetz, a republican from Florida argues that allowing Tilray to import cannabis for research is taking away wealth and jobs away from the US.
According to a new statement issued by the FBI, there is an arrest every 48 seconds in the US related to cannabis. Most arrests are due to driving while in possession of cannabis. While possession busts have gone up, busts on producers and distributors has gone down.
The excitement around the cannabis industry has many wondering the legalities of importing and exporting hemp, however there are a few things to know. While you might be able to import or export hemp stalks, there are still risks associated with customs and inspection.
Colorado has loosened the restrictions around testing hemp derived CBD. Previously only hemp registered with the Colorado Department of Agriculture could be tested, but now that CBD has caught the public’s attention, they are opening testing labs to hemp producers.
Oklahoma approved over 1,100 business licenses for cannabis businesses and have another 600 waiting for approval. Only 3700 medical licenses have been issued and 27 caregiver certifications, making the disproportionate ratio of businesses to patients questionable.
Obtaining permanent licenses for cannabis businesses in California has become a running joke that isn’t funny anymore. The Senate Bill 1459 has passed legislation and is awaiting the governor’s signature to permit applicants to operate under provisional licensing with a 12 month limit, however these applicants may be waiting another year for permanent licensure.
Woodland California approved five cannabis businesses for manufacturing, distribution, cultivation, and testing facilities. None of the new locations are open to the public for retail purchases. ProTerps lead the way, calling the decision a historic moment.
FSD Pharma and their R&D partners Sci Cann Therapeutics announced their intention to launch a cardiovascular research program at a Tel Aviv University. The study will focus on atherosclerotic treatments and prevention.
According to researchers there is more to cannabis beyond CBD and THC, that terpene profiles are the driving force behind the well known active compounds.
Colleges and cannabis firms are working together to create programs for aspiring professionals looking to enter the industry. One of many examples is Okanagan College in British Columbia who partnered with Sunniva to start a training program that would allow the company to hire 200 professionals by 2019.