Canada’s marijuana stocks triggered numerous circuit-breaking halts in trading Wednesday
TORONTO — Volatile prices of Canada’s marijuana stocks triggered numerous circuit-breaking halts in trading Wednesday as buzz surrounding the nascent sector pushed valuations to record intraday highs.
Related: Marijuana-Bubble Index: Beware of Rising Valuations
[Editor’s Note: Ubika Research/SmallCapPower has released the premier edition of its Marijuana-Bubble Index, a snapshot to educate investors on Canada’s marijuana industry and provide some insights and valuations on the publicly-traded industry players. The marijuana stocks it chose for inclusion, if you were to put them into a market-cap weighted index, are up almost 200% this year and have increased about 20% since November 1st.]
Aphria Inc., Mettrum Health Corp., Organigram Holdings Inc., Supreme Pharmaceuticals Inc., Aurora Cannabis Inc. and Canopy Growth Corp. were all halted for five-minute intervals Wednesday—some of them multiple times.
The Investment Industry Regulatory Organization of Canada said the halts were triggered by single stock circuit breakers “due to volatility in the stock prices.” It did not comment further.
Circuit breaks are tripped when a stock climbs or falls at least 10 per cent in a five-minute period, which appears to have been the case with the six marijuana stocks Wednesday.
The halts seem to have put the brakes on for overly enthusiastic investors as five of the six stocks closed lower. Many were halted again after seeing a similar tumble on their way down.
Canopy Growth — Canada’s largest marijuana company — was halted four times, after reaching a valuation of $2 billion, double its worth on Friday when it first reached the $1 billion mark for the first time.
That hefty valuation comes despite the fact the Smiths Falls, Ont.-based company has yet to report a profit and earned $8.5 million in revenue during the most recent quarter. Seen as a bellwether for the sector, the stock turned around to close 15.2 per cent lower at $11.40. It was the most actively traded stock on the TSX Wednesday, with more than 24 million shares changing hands.
Read the full article at: business.financialpost.com
