Ancillary Cannabis Stocks Drop 10% in September

Following up on our discussion earlier this year about how cannabis investors have embraced publicly traded ancillary companies, New Cannabis Ventures launched its seventh proprietary index, the Ancillary Cannabis Index, at the end of March.

The index continued to outpace the overall market in September, falling 10.4% to 83.77, slightly better than the 12.6% decline in the New Cannabis Ventures Global Cannabis Stock Index:

The index has declined 16.2% since its introduction at the end of March:

The Ancillary Cannabis Index includes companies that provide goods and services to cannabis operators. Each qualifying company must trade at a minimum of $0.50 per share with a minimum average daily trading value of $500K at the time the index is rebalanced each month. Additionally, members of the index must generate at least $1 million per quarter from its ancillary operations.

During September, the index included 13 members, with 1 posting a double-digit gain and 6 declining by more than 10%, with a median return of -6.7%:

The three strongest stocks included Power REIT (NYSE American: PW), WM Technology (NASDAQ: MAPS) and AFC Gamma (NASDAQ: AFCG). Power REIT has gained 87% this year. WM Technology, which was a SPAC that began trading on its own earlier this year, remains well above the SPAC price but has declined considerably since it began trading after the merger. AFC Gamma continues to trade above its March $19 IPO price.

The three weakest names during  September included Agrify (NASDAQ: AGFY), Hydrofarm (NASDAQ: HYFM) and iPower (NASDAQ: IPW). Agrify, which was the strongest name in the prior two months, remains well above its $10 IPO price from January. Hydrofarm, which posted an all-time low during the month, is down 28% in 2021 but remains above its $20 IPO price in December. iPower ended the month 21% below its May $5 IPO price.

For October, we are adding Forian (NASDAQ: FORA) and Newlake Capital Partners (OTC:NLCP), leaving the index with 15 members.

In the next monthly review, we will summarize the performance for October and discuss any additions or deletions. Be sure to bookmark the page to stay current on ancillary cannabis company stock price movements within the day or from day-to-day.

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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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