Tokers & Jokers | Cannabis Stocks Bounce Back

Canna stocks bounced back Wednesday with most US and Canadian cannabis companies climbing from yesterday’s losses.

Tuesday Green Growth Brands (OTCMKTS: GGBXF) (CSE: GGB) announced the appointment of retail veteran Brian Logan CPA, as its new Chief Financial Officer. Previously, Logan worked as Vice President of Finance for Abercrombie & Fitch Co. Logan will bring his 20+ years of global experience in corporate finance, international finance, and investor relations to Green Growth.

Green Growth recently 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.

Fortunately for critics of the deal, it appears the exchange ratio between the two companies has broken down. The all-share, no-cash deal would give Aphria shareholders 1.5714 common shares of GGB for each APHA share. Green Growth proposed a $300M equity financing to boost its share price to $7, valuing Aphria at $11 based on the exchange ratio. Many investors feel this offer is financially insignificant.

Aphria’s subsidiary holds 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.

Currently Aphria is under scrutiny for insider enrichment at the cost of shareholders. 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.

Green Growth closed up 1.96% on the OTC at $3.86.

Aprhia ended the day up 5.36% at $7.66.

According to Tuesday’s report from Zacks, Cronos Group (NASDAQ: CRON) has gained 77.86% over the past month. Noting the company’s valuation metrics, and it’s P/E ratio of 176, Zacks gave Cronos a “strong sell” ranking.  Complimenting the company’s recent strategic partnership with Alrtia and its strong management team, Jim Cramer gave Cronos a bullish endorsement, calling Cronos his second favorite cannabis pick. 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. Cronos was up 1.54% at the end of trading at $18.43.

Tuesday Canopy Growth Corp. (NYSE: CGC) 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. Tuesday, the company announced its financial backing of CSE’s most recent cannabis listing, Slang Worldwide Inc. (CSE: SLNG)  Analysts warn investors Canopy is overbought in the near term. The company closed up 1.89% and was trading at $48.02.

Slang Worldwide closed the day up 26.13% at $2.51.

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.

Wednesday, Pi Financial upped the company’s price target from CA$8 to CA$10. Beacon Securities also boosted its price objective on Organigram, setting its estimated target price at CA$12, and giving the company a “buy” rating.

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 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. Valens is also celebrating a recent extraction agreement with Sundial Growers.

Organigram climbed 1.08% on the OTC and was trading at $5.63.

Valens GroWorks Corp. gained 3.66% on the OTC and was trading at $1.82.

Matt Bottomley, director of equity research and cannabis analyst with Canaccord Genuity Group, gave Curaleaf Holdings (OTCMKTS: CURLF) (CSE: CURA) a bullish endorsement — calling the company his top stock-pick of the year. Monday the company appointed Neil Davidson as Chief Financial Officer and Todd Goffman as General Counsel and Secretary. The company was trading down 0.16% at $6.15.

Currently four out of the five analysts who cover Zynerba Pharmaceuticals Inc (NASDAQ: ZYNE) have issued “buy” ratings on the company, with an average target price of $18.40. The company climbed 4.57% to $5.03.

Analysts’ average price target for Tilray (NASDAQ: TLRY) hovers around $127.50, giving the stock a lot of room to grow. This week however, Tilray 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 issued a press release pledging not to sell shares of Tilray. Currently Privateer holds 88% of Tilray’s outstanding shares. Tilray shares were down 2.00% and trading at $77.48.

Tuesday The Green Organic Dutchman Holdings Ltd. (OTCMKTS: TGODF) (TSE: TGOD) entered into a definitive agreement with Queen Genetics/Knud Jepsen A/S to establish two 50/50 joint ventures in Denmark. The company 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. TGOD is also in talks with the Greek Ministry of Agriculture and is awaiting a license for the production of medical cannabisLast week TGOD 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 4.21% at $2.73.

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 up 4.16% at $61.30.

Monday, Market Wealth initiated coverage on Aurora Cannabis (NYSE: ACB) and Cronos, issuing research reports on both companies, giving Aurora a bullish endorsement. Shares of Aurora climbed 0.58%% to $6.93.

Neptune Wellness Solutions (NASDAQ: NEPT) has risen 19.26% over the last four weeks. Zacks gave the company a “strong buy” rating last week, 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 climbed 2.17% and was trading at to $3.29.

Acreage Holdings Inc.’s (OTCMKTS: ACRGF) (CNSX: ACRG.U) was down on the OTC by 0.19% and trading at $21.92 at the end of the day.

Out of the 12 analysts covering GW Pharmaceuticals (NASDAQ: GWPH), all but one has a “buy” rating on the company. GW is expected to gain 4.2% in the next quarter, Zacks reiterated its “hold” rating Tuesday. 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 climbed 3.36% and was trading at $140.44.

Today Hexo Corp. (NYSE: HEXO) (TSE: HEXO) announced it has raised $43.3M through a sale of stock. Hexo 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 company began trading on the New York Stock Exchange last week.The offering closed January 30, 2019. The company ended the day trading up 0.76% and trading at $5.27.

MedMen Enterprises Inc (OTCMKTS: MMNFF) (CNSX: MMEN) was up by 1.22% on the OTC and trading at $3.62.

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 gained 2.96% and was trading at $2.93.

Monday, Zacks downgraded KushCo Holdings Inc.’s (OTCMKTS: KSHB) to a “Sell” rating. Company Chairman Nicholas Kovacevich sold 200,000 shares of the company for a total value of $1.208B. Kushco was trading up 0.18% at $5.51.

Russell Stanley of Beacon Securities initiated coverage on Trulieve Cannabis Corp. (OTCMKTS: TCNNF) (CSE: TRUL) last week giving the company a “buy” rating with a price target of CA$28.00. Trulieve was recognized by the Minorities of Medical Marijuana as their 2018 Diversity and Inclusion Champion of the Year Award recipient. 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 up 2.17% on the OTC at $10.67.

Monday Cresco Labs (OTCMKTS: CRLBF) (CSE: CL) announced 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 2.53% on the OTC and trading at $6.82.

Auxly Cannabis Group Inc. (OTCMKTS: CBWTF) was recently granted an “outperform” rating from AltaCorp. Auxly was up 0.50% 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 was up 4.04% 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. iAnthus lost 017% and was trading at $5.10.

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 climbed 0.99% on the OTC and was trading at $1.07.

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 up 0.86% at $4.45.

MediPharm Labs (TSXV: LABS) (OTCQB: MLCPF) recently issued forward looking statements regarding the company’s intention to expand internationally. MediPharm climbed 4.93% on the OTC and was trading at $1.49 at the close of trading.

TerrAscend Corp (CSE: TER) (OTCMKTS: TRSSF) climbed 3.39% closing out the day at $6.40 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 up 3.57% at $3.65.

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 gained 0.72% on the OTC, trading at $7.00.

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. Origin House has advanced $750,000 in financing to Utopia Cannabis. The funds will go towards the purchase of Utopia’s manufactured cannabis products. Origin 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 up 2.67% and trading at $7.08.

According to Zacks, equities research analysts forecast New Age Beverage Co. (NASDAQ: NBEV) to post $14.06M in sales for the current quarter, and $52.23M for the current fiscal year. The company 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 gain of 2.47% Tuesday and was trading at $7.04.

Horizons ETFs Management Canada Inc. (TSE: HMMJ) gained 0.87% and was trading at $19.69.

The Horizons Marijuana Life Sciences Index ETF (OTC: HMLSF) climbed 1.86% and trading at $14.94.

ETFMG Alternative Harvest ETF (NYSEARCA: MJ) The ETF was trading up 1.75% at $33.81.

The North American Marijuana Index tracks the leading cannabis stocks in the US and Canadian Sectors. The Index gained 1.84% and was trading at $283.12.

1 thought on “Tokers & Jokers | Cannabis Stocks Bounce Back”

  1. Pingback: Daily Cannabis News Roundup | January 31, 2019 - The Morning Blunt