You’re reading this week’s edition of the New Cannabis Ventures weekly newsletter, which we have been publishing since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve as well as links to the week’s most important news. We post this and all of the newsletters on our website here.
Friends,
Things seem to be getting better fundamentally for the American cannabis industry, but the prices are not improving! In fact, the NCV American Cannabis Operator Index, which currently has 13 MSO members, is now down 0.5% in 2024. On April 30th, it peaked at up 58.9% year-to-date, so it has come down 37.4%:
The index has rallied over the last year and has gained 33.7% since August 29th, the day before the potential rescheduling news hit the market. The broader NCV Global Cannabis Stock Index has gained 20.1% since that late August date, which is less than the American Cannabis Operator Index, but the GCSI has gained 9.9% so far in 2024. It has dropped 24.0% since the end of April.
The 5 largest MSOs are up still in 2024 on average, as only one has declined:
Three of the 4 Tier 2 names have declined:
The falling prices and the rising potential for the end of 280E taxation ending make cannabis stocks a lot more interesting in my view. Of course, this doesn’t mean that investors should just buy any and all cannabis stocks. We have discussed the idea that there have been and remain some good options among the ancillary companies. Of course, they don’t pay 280E taxes, but having a customer base that does so has created challenges for them. Investors can find ancillary companies with strong balance sheets and listing on higher exchanges with better valuations.
The complete round trip of a very popular part of the cannabis market is a bit surprising. I think that many folks jumped in too early and have grown impatient. Rescheduling is not a done deal at all, and perhaps people are realizing that it might not happen, though it sure seems extremely likely.
New Cannabis Ventures publishes curated articles as well as exclusive news. Here is some of the most important content from this week:
Exclusives
Florida Medical Patient Growth Sets All-Time Low
Michigan Cannabis Sales Slow Again
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View the Public Cannabis Company Revenue & Income Tracker, which ranks the top revenue producing cannabis stocks.
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Sincerely,
Alan
