The Morning Blunt
Volume 3| Issue 13
November 13, 2018
“Don’t let yesterday take up too much of today.”
After revealing the company produced 11K pounds of cannabis last quarter, Aurora Cannabis (NYSE: ACB) closes out with earnings surging 2800% to CA$104.2M, bringing total revenue to CA$29.7M. The company sold 5900 pounds of cannabis for the quarter, up 201% from this time last year.
MediPharm Labs Corp. (TSXV: LABS) announced that its subsidiary MediPharm Labs Inc. has received its sales license from Canada Health for its laboratory and manufacturing facility in Barrie Ontario.
Motley Fool’s Keith Speights warns investors that cannabis firms aren’t selling weed, they’re selling growth. Unfortunately, the growth many large firms pitch isn’t as attractive as it may seem and may not actualize until the distant future. Speights advises focusing on smaller cannabis stocks with less lofty valuations and realistic growth goals.
Motley Fool’s Sean Williams reports the way companies like Aurora Cannabis (NYSE: ACB), Aphria (NYSE: APHA), and Canopy Growth (NYSE: CGC) approach acquisitions might be setting investors up to fail. An overwhelming majority of acquisitions within the cannabis sector have been executed using only common stock, setting investors up to foot the bill, while firms like Aurora sacrifice their profit shares and expand their share count in order to avoid cash burn during their expansion campaigns.
Friday after market close Hexo Corp (TSE: HEXO) (OTCMKTS: HYYDF) announced that it had filed a preliminary short-form base shelf prospectus, which will enable the company to make offerings of common shares, warrants, subscription receipts, and/or units up to the amount of $800M. Take a closer look to see what Hexo plans to do with its war-chest of funds. On another note, Acreage Holdings holds its stance against a lawsuit filed against the company just days before the company goes public on the Canadian Securities Exchange.
Motley Fool’s Keith Speights examines the pros and cons of investing in cannabis firm Canopy Growth Corp. (NYSE: CGC) and compares the stock to Scott’s Miracle-Gro Co. (NYSE: SMG). According to Speights conservative, long-term buyers will probably prefer Scott’s Miracle Gro, however more aggressive growth investors will probably prefer Canopy Growth.
Jim Bloom of Insider Financial makes a case for Next Wave Holdings Inc. (CNSX: NGW). This vertically integrated cannabis firm based in California has moved into its acquisition phase of its development, purchasing two facilities and a 15-acre farm. According to Bloom the company continues to lay the groundwork for revenue base growth thus increasing their valuation.
Player’s Network Inc. (OTCQB: PNTV) and the Argentinian province of Jujuy have signed a memorandum of understanding to jointly develop 14K hectares for THC and CBD rich cannabis genetics for domestic and global markets.
A death sentence handed down in Malaysia to a young man accused of selling cannabis oil to the ill has stirred debate among the Muslim-majority over the country’s strict drug laws. The controversy has sparked a medical marijuana movement in Malaysia, however the conservative majority and long-held stigma could mean a slow change.
Based in Tel Aviv Israel, Go on Green Ltd. announced the pre-sale release of its first smart medical cannabis storage hub, Kassi. Go on Green designed Kassi to automatically log users consumption time, dosage history, and sends reminders via the app when your inventory is low. The app also tracks temperature, humidity, allows you to communicate and reorder from dispensaries, and even comes with voice activation from Alexa/Siri.
Friday Senate Majority Leader Mitch McConnell guaranteed the final version of the Farm Bill will include the US legalization of hemp. McConnell said finalizing the bill is one of his highest priorities when Congress reconvenes for a lame-duck session, and said his goal is to have the hemp industry ‘lightly’ regulated by the federal department of agriculture.
Washington state issued its first research-class cannabis license to Verde Bio, a Seattle pharmaceutical company focusing on developing cannabis genetics that contain uncommon cannabinoid profiles. Verde Bio hopes to breed plants that produce chemicals outside of THC to conduct research into the effects of minor compounds. No other firms have applied for a research-grade license.
Canadian cannabis producers and operators are developing new products and brands ahead of the second stage of legalization when edibles, concentrates, and drinks will be permitted for sale in the country.
Health Canada requires that all cannabis executive leaders at licensed production facilities, including CEOs and master growers, to have security clearance including a criminal background check. This stipulation excludes most black-market producers who spawned the fledgling sector. Take a look at how Canada Health’s policy is excluding the founders of the cannabis industry and simultaneously stunting economic growth.
The federal government is seeking out researchers to investigate how lesser known terpenes and cannabinoids work and if they can treat pain. This week the National Center for Complimentary and Integrative Health issued a pair of funding notices stating the federal research project will cover all minor cannabinoids, which is defined as any compound besides THC.