Tokers & Jokers | Cannabis Stocks Take A Hit

Canna stocks were in hot water Tuesday with most US and Canadian cannabis companies in the red.

Green Growth Brands (OTCMKTS: GGBXF) (CSE: GGB) announced today the appointment of Brian Logan CPA, as its new Chief Financial Officer. Logan is a retail veteran from  Abercrombie & Fitch Co. with over 20 years of global experience in corporate finance, international finance, and investor relations.

Last week Green Growth initiated a “hostile” takeover offer for Aphria Inc (NYSE: APHA). The deal however, is riddled with unorthodox terms, including Green Growth’s commitment to pay All Js Greenspace LLC — a finance company assisting with Green Growth’s capital-raise — a fee of $7.5 million if the deal does not go through.

According to analyst Dmitry Zaytsev, Aphria’s subsidiary holds a 10% stake in GA Opportunities — the largest shareholder in Green Growth Brands. Further, the two companies have had several dealings in the past, leaving critics of the takeover wondering if this is truly a hostile bid.

Green Growth closed down 6.52% on the OTC at $3.79.

Once again Aphria is under scrutiny for insider self dealing. A class action lawsuit is being brought against the company. Aphria stands accused of purchasing a number of Latin American assets at a significant markup in order to financially benefit insiders. The Schall Law Firm encourage investors who purchased Aphria shares between between July 17, 2018 and December 4, 2018 to contact the firm before February 4, 2019.

Aprhia ended the day down 1.36% at $7.27.

Cronos Group (NASDAQ: CRON) had a heck of a Monday after Jim Cramer gave Cronos a bullish endorsement. Cramer called Cronos his second favorite cannabis pick, complimenting the company’s recent strategic partnership with Alrtia and its strong management team. Further, Market Wealth initiated coverage on Cronos, also giving the company a bullish endorsement. And just last week CIBC endorsed Cronos as a likely winner in the global cannabis market. Divergent sale prices have resulted in Cronos surpassing Tilray as the most expensive stock. The company is trading at 266x versus Tilray at 155x EV / revenue. Cronos was down 1.79% at the end of trading at $18.15.

Canopy Growth Corp. (NYSE: CGC) has a lot going on! Today the company announced Alan Gertner, head of retail sales, has left the company. In the last three weeks Canopy Growth has been up more than 75% reflecting the stream of positive news for the company. Last week Piper Jaffray reiterated their “overweight” rating on the company, raising Canopy’s target price from $40 to $60 per share. CIBC also gave the company a bullish endorsement last week, calling Canopy the cannabis industry’s best chance at a global titan. Analysts warn investors the stock is overbought in the near term. The company closed down 7.13% and was trading at $47.13.

Monday Organigram Holdings Inc. (OTCMKTS: OGRMF) (CVE: OGI) announced its first quarter financial results for fiscal 2019. The company reported a net revenue of $12.4M — up 287% sequentially quarter-over-quarter. Revenue adjusted for excise tax and returns rose 419% in the year-ago period.

Organigram announced Tuesday morning that it has entered into a multi-year extraction agreement with Valens GroWorks Corp. (CSE: VGW) (OTC: VGWCF). Valens will be responsible for extracting cannabis concentrate from flower provided by Organigram.

Organigram is entering into a class action lawsuit for cannabis that was produced between Feb. 1 and Dec. 16, 2016. Organigram is accused of using unauthorized pesticides.

Organigram climbed 4.87% on the OTC and was trading at $5.57.

Valens GroWorks Corp. (CSE: VGW) (OTC: VGWCF) lost 0.25% and was trading at $1.76

Monday Curaleaf Holdings (OTCMKTS: CURLF) (CSE: CURA) appointed Neil Davidson as Chief Financial Officer and Todd Goffman as General Counsel and Secretary. Matt Bottomley, director of equity research and cannabis analyst with Canaccord Genuity Group, gave Curaleaf a bullish endorsement — calling the company his top stock-pick of the year. Curaleaf recently joined the New Jersey Business & Industry Association as the first cannabis company in the 20,000 member organization. The company was trading down 0.16% at $6.16.

Tilray (NASDAQ: TLRY) took a dive after the company’s CEO Brendan Kennedy, who also serves as the Executive Chairman of Privateer Holdings, sold over 149K shares worth $11M of his personal stock. Privateer Holdings — currently holding 88% of Tilray’s outstanding shares — recently issued a press release pledging not to sell shares of Tilray. Tilray shares were down 3.50% and trading at $79.06.

The Green Organic Dutchman Holdings Ltd. (OTCMKTS: TGODF) (TSE: TGOD) received a bullish endorsement from Network News Wire Tuesday, noting the company’s management team strength, brand development, capital allocation, price target and distribution channel. The company recently announced it has entered into a definitive agreement with Queen Genetics/Knud Jepsen A/S to establish two 50/50 joint ventures in Denmark. Last week the company announced the Ontario Superior Court of Justice approved its spin-off of subsidiary TGOD Acquisitions Corp — an investment firm focused on the Canadian and international cannabis industry. The Green Organic Dutchman was trading down on the OTC by 5.61% at $2.85.

Zacks recently gave Innovative Industrial Properties Inc. (NYSE: IIPR) a “hold” rating, estimating its current fiscal-year earnings to have risen 1.8% in the last 90 days. The company released its latest investor presentation this last week, announcing it had $25.6B annual base rent and property management fees. Innovative ended the day trading down 4.22% at $58.85.

Monday, Market Wealth initiated coverage on Aurora Cannabis (NYSE: ACB) and Cronos, issuing research reports on both companies. Shares of Aurora lost 2.96% to $6.89.

Last week Neptune Wellness Solutions (NASDAQ: NEPT) received a “strong buy” rating from Zacks, with a price target of $6.06. Recently the company announced it received its Health Canada licenses in early January and is pushing ahead with commercialization. Neptune lost 2.72% and was trading at to $3.22.

Acreage Holdings Inc.’s (OTCMKTS: ACRGF) (CNSX: ACRG.U) was down on the OTC by 0.49% and trading at $21.96 at the end of the day.

Expected to gain 4.2% in the next quarter, Zacks gave GW Pharmaceuticals (NASDAQ: GWPH) reiterated its “hold” rating today. Zacks provided estimates for GW Pharmaceuticals PLC-‘s earnings with an expected earnings of $2.97 per share for the current quarter. Piper Jaffray also issued estimates for the company at $0.02 EPS for Q3 2020 and $0.06 EPS for Q4 2020. Piper Jaffray currently lists GW Pharmaceuticals with an “overweight” rating. The company lost 1.59% and was trading at $135.87.

Hexo Corp. (NYSE: HEXO) (TSE: HEXO) began trading on the New York Stock Exchange last week. The company has priced a public offering of 7.7M shares of common stock at the price of CA$6.50 for the gross proceeds of CA$50.05M. The offering closes January 30, 2019. The company ended the day trading down 0.76% and trading at $5.23.

MedMen Enterprises Inc (OTCMKTS: MMNFF) (CNSX: MMEN) was down by 1.10% on the OTC and trading at $3.58.

With a 70% plunge since its reverse takeover in November MJardin Group Inc. (OTCMKTS: MJARF) (CSE: MJAR) has had one of the worst performances among new listings. MJardin received an “underperform” rating from Cornerstone Investments due to the company’s focus on cultivation in Colorado — technically the least attractive business model, in the least attractive US market. The company recently had its common stock upgraded to the OTCQX Best Market. Mjardin lost 4.53% and was trading at $2.85.

Recently, KushCo Holdings Inc.’s (OTCMKTS: KSHB) Chairman Nicholas Kovacevich sold 200,000 shares of the company for a total value of $1.208B.Monday, Zacks Investment Research downgraded the company to a “Sell” rating. Kushco was trading up 0.55% at $5.50.

Russell Stanley of Beacon Securities initiated coverage on Trulieve Cannabis Corp. (OTCMKTS: TCNNF) (CSE: TRUL) last week giving the company a CA$28.00 price target with a projected return of 93%. Beacon gives the company a “buy” recommendation. Last Friday, about 98 million shares of the company were unlocked, representing 89% of Trulieve’s outstanding shares. The company announced that approximately 75.5M subordinate voting shares held by the company’s founders won’t be sold prior to July 25, 2019. Trulieve was trading down 0.57% on the OTC at $10.44.

Cresco Labs (OTCMKTS: CRLBF) (CSE: CL) announced Monday the appointment of Tom Manning as Chairman of the Board of Directors. Manning is the CEO of Dun & Bradstreet, a global corporate information provider and data analytics company. Cresco was down 1.26% on the OTC and trading at $6.65.

Auxly Cannabis Group Inc. (OTCMKTS: CBWTF) was recently granted an “outperform” rating from AltaCorp. Auxly was down 3.17% with a price at $0.71.

FSD Pharma (OTCMKTS: FSDDF) recently hired Rupert Haynes, a previous executive from GW Pharmaceuticals as the company’s new CEO. The company saw no change on the OTC and was trading at $0.24.

Northland Capital Markets recently initiated coverage iAnthus Capital Holdings (OTCMKTS: ITHUF) giving the company with an “outperform” rating and a $9.50 price target. iAnthus announced it has signed a definitive agreement with Curative Cannabis to acquire 46% of Curative’s common shares. The two companies will enter into a long-term cannabis purchase and sale agreement to fund Curative’s cannabis cultivation facility in Chatham-Kent Ontario. iAnthus lost 1.90% and was trading at $5.09.

Earlier this week the Israel government approved the export of medicinal cannabis. Namaste Technologies Inc. (OTCMKTS: NXTTF) (TSXV: N) has a ten percent stake in Cannbit Ltd., an Israel-based cannabis producer, as well as a collaboration and supply agreement to purchase medical cannabis from Cannbit. Namaste lost 7.87% on the OTC and was trading at $1.06.

MariMed Inc (OTCQB: MRMD) recently announced that it is forming MariMed Hemp Inc. as a subsidiary that will handle hemp-derived CBD product branding and production. MariMed closed the day down 7.99% at $4.41.

MediPharm Labs (TSXV: LABS) (OTCQB: MLCPF) recently issued forward looking statements regarding the company’s intention to expand internationally. MediPharm lost 2.74% on the OTC and was trading at $1.42 at the close of trading.

TerrAscend Corp (CSE: TER) (OTCMKTS: TRSSF) lost 1.03% closing out the day at $6.19 on the OTC.

Last week Sunniva Inc (CSE: SNN) (OTCQB: SNNVF) announced a $10M non-brokered offering to provide working capital in response to a high demand. The company was trading down 1.58% at $3.52.

Last week CannTrust Holdings Inc. (OTCMKTS: CNTTF) (TSX: TRST) filed an application to list on the NYSE. CannTrust is also moving to Phase III construction of its Town of Pelham facility. CannTrust lost 2.15% on the OTC, trading at $6.95.

Ranked as the second best-performing stock on the OTCQX Best Market, Origin House (OTCMKTS: ORHOF) (CNSX :OH) had a return of 58.9% in 2018. The company announced Monday that it has signed an exclusive agreement with NBA star Al Harrington’s Viola to produce, package, and sell all Viola products in California. The company was trading down 2.88% and trading at $6.90.

New Age Beverage Co. (NASDAQ: NBEV) announced it has signed a definitive agreement to acquire Morinda Holdings Inc. for $85M. Aegis analyst Rommel Dionisio doubled his price target for the company from $4 to $8. Dionisio reiterated his “buy” rating on the stock. ValuEngine also upgraded the stock from a “hold” position to a “buy” rating. New Age saw a loss of 3.24% Tuesday and was trading at $6.87.

Horizons ETFs Management Canada Inc. (TSE: HMMJ) announced a change to the risk rating of the Horizons China High Dividend Yield Index ETF (“HCN“), from “medium high” to “medium”. Last week, Horizon’s announced the launch of the Horizons Equal Weight Canada REIT Index ETF (“HCRE”) and the Horizons Equal Weight Canada Banks Index ETF (“HEWB”). HMMJ lost 2.01% and was trading at $19.51.

The Horizons Marijuana Life Sciences Index ETF (OTC: HMLSF) lost 2.21% and trading at $14.67.

ETFMG Alternative Harvest ETF (NYSEARCA: MJ) The ETF was trading down 1.69% at $33.23.

The North American Marijuana Index tracks the leading cannabis stocks in the US and Canadian Sectors. The Index lost 1.87% and was trading at $277.96.

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