Marijuana stock news and notes: Bruce Linton talks cannabis, Weekend Unlimited wins ‘POT,’ and Aphria rebounds —finally
Canopy Growth Corporation (TSX:WEED) (NYSE:CGC) CEO Bruce Linton sat down with Globe and Mail reporter Jameson Berkow in front of a crowd at the Cantech Investment Conference to give his current opinions on the cannabis industry at-large. Of note, Linton went against conventional wisdom on a couple of topics, telling the crowd at the conference that Canada’s taxation rates were reasonable and that dried flower may be worth more than some think.
“Our taxation rates on cannabis are actually really unbelievably reasonable,” he told Berkow. “If you look at anything else that you do that’s viewed as sinful, it multiples of the cannabis excise tax.”
Taxes, among other things, have been a sticking point among consumers in Canada, leading to the continued dominance of the black market.
Moreover, Linton isn’t a believer in the cannabis-as-a-commodity notion, a conversation that has made its way around the industry as states such as Oregon struggle with falling flower prices.
“Ingredients always go down in price but that doesn’t mean that the products you make with those ingredients don’t go on to have a sustained higher value,” said Linton. “I think that dried flower is actually going to be a bespoke, ceremonial, high-price component of the market over time. There might be some cheap dried product out there but if people really want to have something that they can show friends when they come over and that they’re actually going to be proud of what they have, they’re going to be looking for a premium quality product.”
Bruce Linton tells CNBC what's next for the cannabis industry
Weekend Unlimited wins the ‘POT’ lottery
Weekend Unlimited Inc. (CSE:YOLO), one of the more well-known lifestyle brands in the cannabis industry won the so-called POT lottery this week, announcing on Thursday that the Canadian Securities Exchange has awarded the company the new stock ticker ‘POT.’
The lottery, first announced by the CSE along with the TSX, the TSX Venture, and the Aequitas NEO Exchange was held in January 2019, with a number of cannabis companies vying for the symbol.
“Weekend Unlimited is thrilled to add the iconic POT trading symbol to its identity,” said Paul Chu, Weekend Unlimited President and CEO in a statement. “As a fast-growing multi-state operator, Weekend Unlimited is developing lifestyle brands around recreational and wellness to help define the future of the cannabis industry. The POT symbol is a tremendous fit with our brand identity.”
Great price action in #aphria $APHA as the month concludes. Rising wedge pattern, clear HH-HL pattern on the hourly and lack of selling pressure (onus is on sellers) portend to a possible breakout soon. Timing looks to be headed into final stages. Will market cooperate? pic.twitter.com/lwunGq6HRH
— Benjamin A. Smith (@BenjaminA_Smith) January 30, 2019
Aphria out of the woods?
Midas Letter’s Benjamin Smith said Aphria Inc. (TSE:APHA) (NYSE:APHA) is out of the woods, having made up the losses from the now-infamous short-seller attack from late last year. While some analysts and investors worried that Aphria didn’t respond quick enough, Smith praised what he called their “starve the beast” effort, stating that ignoring the problem was essentially the best thing to do out of a series of bad options.
“While Aphria’s crisis management methodology won’t make everyone happy, it has been unquestionably effective,” he wrote. “Remaining detractors have effectively become euthanized over time—fringe lone voices in the wilderness. The company’s bet to allow proxies to work for them has paid off—to the point where dredging up a rebuttal would constitute more risk versus letting sleeping dogs lie.”
Taking profits on $APHA. Stock up 60% since call a month ago. Canadian Weed has run too far moving into in US names. $CRON short with stock trading 70% above analyst tgt. As CIBC noted "sophisticated investors are beginning to shift capital to U.S operators."
— Citron Research (@CitronResearch) February 1, 2019
Still, while some praised Aphria’s rebound, other’s worried about the long-term plan. Notorious short-sellers Citron research tweeted out on Friday that it was time to take the profits and run.
Canadian LPs gain in 2019
Following a sharp decline in the last quarter of 2018, Canadian LPs rallied hard to begin the new year. According to the Canadian Cannabis LP Index, they showed a 36 percent increase in the first part of 2019, a big turnaround from the 43 percent drop in the fourth quarter of last year. The index includes 45 publicly-traded licensed producers from Canada, which are equally weighted. It is rebalanced monthly.