The Canadian marijuana juniors we have weeded out have outperformed the HMJR junior cannabis ETF during the past month and have attractive RSI metrics
SmallCapPower | August 9, 2018: The Horizons Emerging Marijuana Growers Index ETF (HMJR) is an equity index that tracks cannabis companies. The index has performed poorly over the past month, decreasing in value by 7.8% relative to the TSX and TSXV, which were down 1% and 5%, respectively. However, many of its individual constituents have done well and may still be considered good buys at their current valuations. As a result, we have identified five Canadian marijuana juniors, our favourite HMJR constituent companies, that have not only outperformed the index, but also have attractive momentum metrics. The Relative Strength Index (RSI) measures a stocks momentum and can be used to identify if a stock has been overbought or oversold. A stock with an RSI of 30 or below is commonly interpreted as being oversold and therefore undervalued.
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Maricann Group Inc. (CSE:MARI, OTCQB:MRRCF) – $1.52
Cannabis
Maricann is a Canadian cannabis company focused on the healthcare market. Founded in 2013, the Company offers a variety of oil and flower products produced in a purpose-built 217,000 sq. ft. facility located in Langton, Ontario. The greenhouse is designed to have the lowest carbon footprint in the industry and uses a state of the art “Closed Controlled Environment Growing System.” The facility currently has capacity to produce 36,000 kg/year, with expansion plans underway that would increase that amount to 105,000 kg/year. Maricann has supply agreements with Manitoba and British Columbia and a reserved allocation of product for Alberta. It also has plans to expand to Germany, Switzerland and Malta.
- Market Cap: $212.3 Million
- 1 Month Total Return : 6.3%
- 3 Month Total Return: -2.6%
- RSI – 30 Days: 39.8
Beleave Inc. (CSE:BE, OTCQX:BLEVF) – $1.23
Cannabis
Beleave is a Canada-based biotech company with a focus on the production of medical marijuana. The Company is working towards the development of patents through research with Canadian institutions, as well as the research and development of cannabis-based therapies, such as smoke harm reduction products, portable and stationary vaporizers and accessories. Beleave Inc’s purpose-built facility is located near Hamilton, Ontario. The Company is planning to expand the facility to 80,000 sq. ft. throughout 2018, with a total expected production capacity of 32,000 kg/year.
- Market Cap: $65.5 Million
- 1 Month Total Return : 4.2%
- 3 Month Total Return: 2.5%
- RSI – 30 Days: 38.6
Liberty Health Sciences Inc. (CSE:LHS, OTCQX:LHSIF) – $0.85
Cannabis
Liberty Health Sciences is a cannabis company that focuses on acquisitions of U.S. based medical cannabis companies. LHS is one of 13 licensed producers and sellers of medical cannabis in Florida, and recently has invested in a licensed producer in Massachusetts. The Company’s production facility in Florida is 25,000 sq. ft. and produces 1,600 kg of cannabis annually. Liberty Health increased its production by 20% with assistance that it received from an agreement with Aphria’s consulting arm. By November 2018, the Company intends to complete its 200,000 sq. ft. expansion to increase its production capacity to 13,000 kg annually.
- Market Cap: $280.6 Million
- 1 Month Total Return : 3.7%
- 3 Month Total Return: 2.4%
- RSI – 30 Days: 33.3
Delta 9 Cannabis Inc. (TSXV:NINE, OTCUS:VRNDF) – $1.30
Cannabis
Delta 9 is a Winnipeg-based licensed producer of medical cannabis that develops over 20 different strains for the Canadian market. Current operations include an 80,000 sq. ft. production facility. On July 31, 2018, Delta 9 reached a licensing agreement with Nanosphere Health Sciences (CSE:NSHS), which granted Delta 9 a license to use Nanosphere’s patented delivery system technology in Canada. Delta 9 would also be permitted to subcontract the patent to other providers in Canada. On July 25, 2018, Delta 9 reached terms with an undisclosed bank for a $12M loan that will allow the Company to fully fund its 2019 business plan.
- Market Cap: $100.5 Million
- 1 Month Total Return : 3.2%
- 3 Month Total Return: 1.6%
- RSI – 30 Days: 41.5
Invictus MD Strategies Corp. (TSXV:GENE, OTC:IVITF) – $1.29
Cannabis
Invictus MD Strategies is a Canada-based company licensed to produce medical cannabis under the ACMPR. As of 2018, Invictus estimates its production capacity to be 27,000 kg/year. The Company has outlined plans to reach 98,000 kg/year capacity by the end of 2019, following the expansion of its facility to 825,000 square feet. KISS front man, Gene Simmons, is involved with Invictus as its Chief Evangelist Officer.
- Market Cap: $126.6 Million
- 1 Month Total Return : 0.8%
- 3 Month Total Return: -19.9%
- RSI – 30 Days: 31.7
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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