Cannabis Market Shows Mixed Action in September

As we described in a previous article, the Global Cannabis Stock Index rallied for the third consecutive month, creating the first quarterly advance since 2021-Q1. That index is now down  down 5.6% 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. The one that was quite strong in August rose again in September, but the other two fell.

American Cannabis Stocks Index

The American Cannabis Operator Index gained again, rising 14.0% to 18.20:

Down 8.6% in Q1, the index fell 6.9% in Q2. In Q3, it rallied 50.2% and is up now 27.7% in 2023, which is better than the Global Cannabis Stock Index. Over the past year, the index has declined 1.6%:

The index, which launched in October 2018, made all-time lows in July and then in August. It is still down a lot from when it launched:

Leading the way higher in September was Verano Holdings (OTC: CCHWF) (NEO: CCHWF), which rallied 29.4%, one of four stocks that increased more than 20%. TerrAscend (OTC: TSNDF) (TSX: TSND), which was unchanged, was the weakest stock.

In September, the index will increase to 13 members with the returns of Ascend Wellness (OTC: AAWH) (CSE: AAWH), Charlotte’s Web (OTC: CWBHF) (TSX: CWEB) and Jushi Holdings (OTC: JUSHF) (CSE: JUSH).

Ancillary Cannabis Index

The Ancillary Cannabis Index was weaker during the month, falling 8.7% to 13.26:

The index, with a massive loss of 76.6% in 2022 to 15.02, has declined 25.5% over the past year. It is down 11.7% in 2023, which is worse than the Global Cannabis Stock Index:

The index is down almost 87% since launching at the end of March in 2021:

The best performing stock in the index in September was Chicago Atlantic (NASDAQ: REFI), while the worst stock, on of three double-digit decliners, was Innovative Industrial Properties (NYSE: IIPR), down 13.3%.

In October, the index will have nine members. Joining are Hydrofarm (NASDAQ: HYFM), NewLake Capital (OTC: NLCP) and WM Technology (NASDAQ: MAPS)

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 June,it fell 13.0% to a new all-time closing low of 60.20. The index lifted 8.1% in July and  rallied again in August, increasing 4.4%. In September, it dropped 1.2% to 67.15:

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. After the 11.5% gain during Q3, it is down 7.5% so far in 2023. Over the last year, it has dropped by 18.1%:

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 four stocks having a higher price at the end of September. 12 of the 21 stocks in the index closed below C$0.25. During September, Organigram (TSX: OGI) (NASDAQ: OGI) fell by 20.0%, while Tilray Brands (TSX: TLRY) (NASDAQ: TLRY) moved 18.8% lower. Cronos Group (TSX: CRON) (NASDAQ: CRON) dropped 1.1%. Canopy Growth (TSX: WEED) (NASDAQ: CGC) rose by 36.4%.

In October, the index will decrease to 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

Get Our Sunday Newsletter