The Canadian marijuana stocks we’ve dug up are doing well despite the general drop in the sector
SmallCapPower | July 26, 2019: With a second report from the Globe and Mail indicating CannTrust executives were aware of the marijuana being grown in unlicensed rooms, cannabis sector share prices have continued to fall throughout the week. Today we have weeded out four Canadian marijuana stocks that have managed to generate positive seven-day returns. For reference, Horizons Marijuana Life Sciences Index’s 7-day return is -2.5%, Canopy Growth Corporation’s seven-day return is 0.5%, and Tilray’s seven-day return is -2.3%.
*Share prices as at close July 24, 2019, data obtained from S&P Capital IQ
Delta 9 Cannabis Inc. (TSXV:DN) – $1.02
Delta 9 Cannabis is a vertically-integrated cannabis company. Its wholly-owned subsidiary, Delta 9 Bio-Tech Inc., is a licensed producer of medical and recreational cannabis. In Winnipeg, Manitoba, the Company operates an 80,000 sq. ft production facility. Delta 9 owns and operates the Delta 9 Cannabis Store brand, which is the Company’s chain of retail stores. Currently, the Company has an expected annual yield of 4,200kg/year but is fully-funded to grow to 16,700kg/year by the end of 2019E. The Company uses its proprietary cannabis production methodology called Grow Pods, which is based on modular, scalable, and stackable production units. Delta 9 received approval from Health Canada on May 22, 2019, to place 48 new Grow Pods from its Phase 2 expansion into production. Additionally, on May 8, 2019, Delta 9 received an export permit from Health Canada to sell starting material to authorized cannabis license holders in Australia and Tasmania. On July 24, 2019, the Company announced that its subsidiary entered into a one-year, white-labeling agreement with Westleaf Inc. Its subsidiary will supply about $4M of Westleaf’s cannabis-derivative products. Visit Delta 9’s corporate website for more information.
Cronos Group Inc. (TSX:CRON) – $20.25
Cronos Group is a globally-diversified and vertically-integrated cannabis company that has a presence in five continents. The Company has two wholly-owned Canadian licensed producers: 1) Peace Naturals Project Inc., a global health and wellness platform; and 2) Original BC Ltd., a recreational adult-use Canadian licensed producer that is located in Okanagan Valley, BC. Cronos’ business strategy is to focus on building an international iconic brand portfolio in addition to developing its intellectual property. The Company reported its Q1/19 financial results on May 9, 2019, which showed that its net revenue surged 120% YoY to $6.5M, with a gross margin of 206%. On July 11, 2019, the Company announced that it had entered into an agreement with Apotex Fermentation to acquire 84,000 sq. ft of GMP-compliant fermentation and manufacturing facility in Winnipeg, Canada. Visit Cronos Group’s corporate website for more information.
- Market Cap: $6,806.8 Million
- YTD Return: 40.8%
- 7 Day Return: 4.1%
- 30-Day Trading Volume (1,000): 562
Village Farms International Inc. (TSX:VFF) – $14.28
Village Farms is a vertically-integrated greenhouse grower in North America. The Company utilizes hydroponic growing methods in glass-enclosed facilities to grow its premium-quality products. Village farms has six greenhouses that cover a total of 9.2M sq. ft. Additionally, the Company has entered into the cannabis space with its joint ventures (JV) with Emerald Health Therapeutics and Nature Crisp LLC to create “Pure Sunfarms Corporation” and “Village Fields Hemp USA LLC,” respectively. On July 11, 2019, the Company announced its 50% JV, Pure Sunfarms, achieved full run-rate production of 75,000kg of dried cannabis annually at its 1.1M sq.ft Delta 3 greenhouse. Visit Village Farms’ corporate website for more information.
- Market Cap: $702.4 Million
- YTD Return: 223.1%
- 7 Day Return: 11.9%
- 30-Day Trading Volume (1,000): 553
YSS Corp. (TSXV:YSS) – $0.36
YSS conducts cannabis retail operations under the YSS™ and Sweet Tree™ brands. Currently YSS has four licensed-operating stores, three are in Calgary and one in Red Deer. The Company has seven licensed-unopened stores: 1) Sweet Tree High River (opening late July); 2) YSS Woodbine Calgary (opening mid-August); 3) YSS Stony Plain; 4) YSS Lloydminster; 5) YSS Vermilion; 6) YSS Vegreville and 7) YSS Spruce Grove. All are expected to open during Q3/19. As of March 31, 2019, the Company has $12.9M of cash to help protect the Company during short-term challenges, capitalize on opportunities and execute organic growth in Alberta and Ontario. Visit their corporate website for more information.
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
To read our full disclosure, please click on the button below: