Ancillary Cannabis Stocks Again Outpaced the Sector

As we described in a previous article, the Global Cannabis Stock Index rallied sharply in July after five consecutive monthly declines following a rally to begin the year. That index is now down  down 12.7% year-to-date, which has followed a record decline of 70.4% for 2022.

In this article, we summarize the performance of the other managed indices that New Cannabis Ventures offers to its readers. We discuss the performance of the American Cannabis Operator Index, Ancillary Cannabis Index and Canadian Cannabis LP Index. All rose during the month, but one lagged the others.

American Cannabis Stocks Index

The American Cannabis Operator Index rose less than the overall sector. In July, it rallied just 0.6% to 12.19:

Down 8.6% in Q1, the index fell 6.9% in Q2. It is down now 14.5% in 2023, which is more than the Global Cannabis Stock Index. Over the past year, the index has declined 50.8%:

The index, which launched in October 2018, finally took out the low from March 2020 in late 2022 and extended the decline in April. It held in May and June, but in July it printed a new low:

Leading the way lower in July was TerrAscend (OTC: TSNDF) (TSX: TSND), which fell 21.5%. Curaleaf (OTC: CURLF) (CSE: CURA) rose 20.3%.

In August, the index will remain at 9 members with the deletion of Columbia Care (OTC: CCHWF) (NEO: CCHW) and the return of Ayr Wellness (OTC: AYRWF) (CSE: AYR.A).

Ancillary Cannabis Index

The Ancillary Cannabis Index rallied again after breaking its downtrend in June, increasing 10.6% to 15.27:

The index, with a massive loss of 76.6% in 2022 to 15.02, has declined 44.0% over the past year. It is up 1.7% in 2023, which is a lot better than the Global Cannabis Stock Index:

The index is down almost 85% since launching at the end of March in 2021:

The best performing stock in the index in June was WM Technology (NASDAQ: MAPS), which rallied 32.5%.  Turning Point Brands (NYSE: TPB), which was the strongest in June, was the only decliner, falling 0.7%.

In August, the index will decrease to 6 members with the removals of SHF Holdings (NASDAQ: SHFS) and of WM Technology due to low trading volumes.

Canadian Cannabis LP Index

The Canadian Cannabis LP Index was very strong to begin the year, rising 19.4% in January and falling just slightly in February, but the index plunged 15.4% in March. In April, it rose 2.9%, but it was very weak in May, falling 7.4%, and in June, dropping 13.0% to a new all-time closing low of 60.20. The index lifted 8.1% in July to 65.08:

The index, up 0.1% in Q1 after falling 11.4% in Q4 , declined the most of the three sub-sectors in Q2, dropping 17.1%. It fell 62.8% in 2022 to 72.59. It is down 10.3% so far in 2023. Over the last year, it has dropped by 31.3%.

The index, which had made a new all-time low in December and then collapsed in June, is down a lot from its peak:

The Canadian LPs trade mainly below C$1, with just five stocks having a higher price at the end of July. Half of the 20 stocks in the index trade below C$0.25. During July, Tilray Brands (TSX: TLRY) (NASDAQ: TLRY) was the strongest of the stocks trading above C$1.00 with a gain of 61.4%. IM Cannabis (CSE: IMCC) (NASDAQ: IMCC), on the other hand, fell 12.7%

In August, the index will remain at 20 members.

New Cannabis Ventures maintains four proprietary indices designed to help investors monitor the publicly-traded cannabis stocks, including the Global Cannabis Stock Index as well as the Canadian Cannabis LP Index. The third index, the American Cannabis Operator Index, was launched at the end of October 2018 and tracks the leading cultivators, processors and retailers of cannabis in the United States. Afterwards, we introduced the Ancillary Cannabis Index at the end of March 2021, reflecting the increasing number of publicly-traded companies providing goods or services to cannabis operators.

Exclusive article by Alan Brochstein, CFA
Alan Brochstein, CFA
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

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