You’re reading 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. We no longer send these by email as we did in the past, but we post this and all of the newsletters on our website here.
Friends,
This week, many more cannabis companies reported Q1 financial reports. While NCV did not run any of those press releases, all of the data was updated on the New Cannabis Ventures Public Cannabis Company Revenue & Income Tracker. The very largest of the companies that report in U.S. dollars have all reported, and the eleven companies that reported for Q1 ending in March (excluding Tilray Brands, which should report its Q4 later this month) had an average revenue growth in their cannabis business from a year ago of 31%:
Excluding Vireo Growth, that average works out to -0.7%, which is lower, especially after considering inflation, and a sign of the ongoing challenges for the cannabis industry. Speaking of Vireo, I have pointed out how investors have not cared, and they still don’t care! Over the past month, just 375K shares per day have traded on average, and the stock, which closed at $0.415, continues to trade very far below the level of the capital raise in late 2024 and the price at which the company has issued shares to make many acquisitions.
April was a big month for cannabis stocks, but May has seen a decline in the prices. The NCV Global Cannabis Stock Index rallied 8.8% in April to 5.70, but it has declined 2.8% in May so far to 5.54. The year-to-date change in this index, which now includes 23 stocks, has been -15.9%. Since the peak in early 2021, the GCSI has declined 94%. Many are excited by the medical cannabis rescheduling that took place in April, though it remains uncertain whether cannabis will be fully rescheduled. The Department of Justice will be holding a hearing in late June to consider adult-use cannabis, and this might be the case. If so, 280E taxation would be eliminated, and this would be very good. I have written about this a lot since late 2022, when I highlighted the potential end of 280E as a major catalyst.
The investor base in cannabis stocks has been diminished by loss of capital and fewer people interested in the sector. Institutions were interested a lot more at the higher prices, and perhaps they will come into the sector. 280E remains the big story, and not only is it being held up by the limited rescheduling already completed, it is also unclear how the unpaid taxes from the past several years will be treated.
NCV has quit publishing most of the cannabis news, though we continue to update the financial calendar as well as the Revenue Ranking. After more than 10 years of running NCV and more than a dozen years of running 420 Investor, I am in the process of moving on. This is likely the last weekly newsletter. I have appreciated sharing the news and my views here, and I want to wish everyone the best. Hopefully, 280E taxation will be ending completely and the bear market that began in early 2021 for the cannabis sector will come to an end.
Sincerely,
Alan
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New Cannabis Ventures publishes curated articles as well as exclusive news. Here is what we published last week:
Exclusives
Michigan Cannabis Sales Fell Yet Again
View the Public Cannabis Company Revenue & Income Tracker, which ranks the top revenue producing cannabis stocks.
Stay on top of some of the most important communications from public companies by viewing upcoming cannabis investor calendar.
