The OTC markets have become home to some the cannabis industries more offbeat stocks in recent years, as the informal market allows companies to have much less stringent reporting requirements than one may find on the Nasdaq or NYSE. Still, many a strong company has seen their start on the OTC, and, if investors are smart, they can make money with penny stocks on the exchange.
Still, it’s the wild west of marijuana stocks —and stock trading in general, which leads most experts to label it with a “buyer beware” warning. However, as mid-cap marijuana stocks remain as volatile as ever, take a look at these small-cap pot stocks that are now listing on the OTC markets.
On Thursday, September 20, Canada’s BlissCo Cannabis Corporation (CSE:BLIS) (OTCQB:HSTRF) announced they would list on the American OTCQB. BlissCo is now trading under the ticker HSTRF.
BlissCo is on track to receive a sales license this November. They are applying for ACMPR licenses to produce and sell both dried cannabis products and oils. Cannabis oil sales increased over ninety percent in Canada this past year, and BlissCo intends to develop extracts that offer a wide range of therapeutic terpenes for patients.
“We intend to use these high-quality extractions to develop a diverse range of cannabis oil products including THC and CBD tinctures, capsules and sublingual sprays for the medical market,” CEO Damian Kettlewell said in a statement last August.
Health Canada already completed a pre-sales license inspection of their extraction facility on September 5, preparing the company for their OTC listing last week. Confident in the inspection results, the company signed a same-day delivery agreement with Pineapple Express Delivery Inc. shortly after on Thursday, September 13. With this agreement, BlissCo will be able to deliver on cannabis orders placed through their online platform or their call center. The goal is to provide patients with more secure options for managing and receiving their medical cannabis.
Delta 9 Cannabis Inc.
Also on Thursday, September 20, Delta 9 Cannabis Inc. (TSXV:NINE) (OTCQX:VRND) started trading on the OTC Market. The holding company for Delta 9 Bio-Tech trades under the ticker VRNDF and opened with an almost 7 percent increase last week.
These positive numbers might have something to do with Delta’s promise to have dispensaries open on the first day of cannabis legalization. Not many retail locations will be ready in time, but Delta’s dispensary in Winnipeg, Manitoba — as well as its online shop — will be open on October 17. For cannabis investors, this is big news for a small-cap pot stock.
“We share the provincial government's desire to provide access to recreational cannabis in different regions of the province,” CEO John Arbuthnot said in a statement. “We bear an additional responsibility to smaller Manitoba communities. Geographic distribution of cannabis stores is an important factor in moving cannabis sales away from the black market.”
Legitimizing the cannabis industry with location could seem absurd, but it could also turn into a financially fruitful situation. For example, one of Delta’s dispensaries will be opening in Osborne Village, a niche neighborhood known for its affordable rents and fun-loving residents. If a company can increase sales with a trendy location and stonewall the black market all at the same time, it could minimize the risk for cannabis investors. Particularly for American investors, any legitimization of cannabis could minimize the risks, making this new listing a positive move for this pot stock.
As the investing arm of Canopy Growth, Canopy Rivers Corporation (TSX-V:RIV)(OTC:CNPOF) is not considered small-cap. But they finalized a qualifying transaction and immediately started trading on the TSX Venture Exchange this past Thursday, September 20. They received a lukewarm opening, with share prices dropping 16 percent by the afternoon. Canopy Rivers fluctuated between $11 and $7 all day.
Despite this unpredictable performance, cannabis investors now know that Canopy Rivers is listing on the OTC, too. And sooner rather than later. (Investors may have caught sight of the pot stock trading with the ticker CNPOF.)