This Part of the Cannabis Market Is Relatively Strong

You’re reading a copy of this week’s edition of the New Cannabis Ventures weekly newsletter, which we have been publishing since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve as well as links to the week’s most important news.

Friends,

It’s almost month-end, and we will publish a review of the indices during July next week. The market, as measured by the New Cannabis Ventures Global Cannabis Stock Index, is still under pressure, down 16.5% so far in 2023, but it has rallied so far during the month. The index has gained 8.1% in July, but the performance is very mixed among the 21 companies in the index. 4 stocks have gained more than 20%, while one has fallen by more than 20%. 6 names have actually declined so far.

Looking at the index, 9 of the 21 names are ancillary, and two of these are in that group of four stocks up strongly. These ancillary stocks represented 42.9% of the index at the end of June. Now, due to their performance, they are 44.8%. We maintain an Ancillary Cannabis Index which has 8 members. 7 of these are in the Global Cannabis Stock Index, while 2 in that index didn’t qualify for inclusion in the Ancillary Cannabis Index.

The Ancillary Cannabis Index, down just 0.6% in the year, has rallied 8.1% in July, in line with the Global Cannabis Stock Index. It had a very rough time in 2022, declining 76.6%, which was worse than the Global Cannabis Stock Index. The small dip in 2023 has helped its performance relative to the overall sector. Since the end of 2021, the Ancillary Cannabis Index has declined 76.8%, while the Global Cannabis Stock Index has dropped 75.3%.

We think that ancillary companies should be considered by those who want to invest in the sector. Unlike the American cannabis operators, there is no 280E tax for them. Additionally, there are no limitations by higher exchanges, which continue to refuse to list American cannabis growers, processors and sellers. Finally, there are no limitations on their operations geographically. Too many investors focus on just one sub-sector, and we believe that it makes more sense to broaden one’s approach to investing in the cannabis markets.

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New Cannabis Ventures publishes curated articles as well as exclusive news. Here is some of the most interesting business content from this week:

Exclusives

Financial Reports

Tilray Reports Q4 Revenue Above Expectations But Gives Weak Outlook

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Use the suite of professionally managed NCV Cannabis Stock Indices to monitor the performance of publicly-traded cannabis companies within the day or over longer time-frames. In addition to the comprehensive Global Cannabis Stock Index, we offer the Canadian Cannabis LP Index, the American Cannabis Operator Index and the Ancillary Cannabis Index.

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Sincerely,

Alan & Joel

Based in Houston, Alan leverages his experience as founder of online community 420 Investor, the first and still largest due diligence platform focused on the publicly-traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. At New Cannabis Ventures, he is responsible for content development and strategic alliances. Before shifting his focus to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst following over two decades in research and portfolio management. A prolific writer, with over 650 articles published since 2007 at Seeking Alpha, where he has 70,000 followers, Alan is a frequent speaker at industry conferences and a frequent source to the media, including the NY Times, the Wall Street Journal, Fox Business, and Bloomberg TV. Contact Alan: Twitter | Facebook | LinkedIn | Email