Cannabis Operators Outperform Ancillary Companies in August

As we described in an earlier article, the Global Cannabis Stock Index fell very slightly in August after a larger gain in July. The index pulled back 1.3% after rallying 4.3% in June. It is still down 53.7% in 2022.

In this exclusive article we will summarize the performance of the other managed indices that New Cannabis Ventures offers to its readers. We will discuss the performance of the American Cannabis Operator Index, Ancillary Cannabis Index and Canadian Cannabis LP Index as well as Canadian Cannabis LP index Tier 1, 2 and 3.

American Cannabis Stocks Index

The American Cannabis Operator Index rose dramatically again in August, gaining 6.7% to 26.43 after rallying an even bigger 18.8% in July that has left the index up 26.8% in Q3 thus far:

For 2022, the index is now down 36.6%, which is much better than the Global Cannabis Stock Index return of -53.7%:

This index, which launched at the end of October in 2018, still hasn’t taken out the March 2020 lows:

During August, Green Thumb Industries (OTC: GTBIF) (CSE: GTII) led the group, gaining 46.0%. It is still down almost 40% in 2022. Three other companies returned more than 20%: Glass House Brands (OTC: GLASF) (NEO: GLAS.A.U), Cresco Labs (OTC: CRLBF) (CSE: CL), and Columbia Care (OTC: CCHWF) (CSE: CCHW) (NEO: CCHW). Planet 13 Holdings (OTC: PLNHF) (CSE: PLTH) and TerrAscend (OTC: TRSSF) (CSE: TER) both fell over 18%.

For September, the index membership has declined from 15 to 13 with the removals of 4Front (OTC: FFNTF) (CSE: FFNT), Goodness Growth (OTC: GDNSF) (CSE: GDNSF) and MariMed (OTC: MRMD) (CSE: MRMD) and the addition of Upexi (NASDAQ: UPXI), formerly Grove, Inc., the exclusive non-THC company.


Ancillary Cannabis Index

The Ancillary Cannabis Index has been a terrible sector in 2022, and in August it decreased 10.4% to 24.43:

In contrast to the rally in the Global Cannabis Stock Index of 3.0%, the Ancillary Cannabis Index has declined 5.6% since June 30th. The year-to-date performance has been very weak, with the index down more than the overall market, falling 62.0%:

The index is down almost 76% since launching 17 months ago:

The best performing stocks during August increased by over 5% and included Chicago Atlantic Real Estate (NASDAQ: REFI), AFC Gamma (NASDAQ: AFCG) and Hydrofarm (NASDAQ: HYFM).  The worst performing stock was, by far, Leafly (NASDAQ: LFLY), which fell 71.4% and is down 84.2% in 2022. During the month, there were just 10 names that qualified for inclusion, but it has increased to 11 for the next month.  Joining for September are Agrify (NASDAQ: AGFY) and Greenlane (NASDAQ: GNLN), while AgriFORCE (NASDAQ: AGRI) exited.


Canadian Cannabis LP Index

The final part of the market for which we have a series of indices is the Canadian LP space. The Canadian Cannabis LP Index broke a fourteen-month losing streak, rising 6.2% to 100.55 in August:

The index has declined 48.4% in 2022 from its year-end 2021 close of 194.95:

The index remains above its early-day lows, but it is down a lot from the peak:

Many LPs don’t qualify to be in the index. At the end of the month, we added Adastra Holdings  (CSE: XTRX) and Avant Brands (TSX: AVNT) (OTC: AVNTF) due to their rising revenue. Both are in Tier 3. We also moved Rubicon Organics (TSXV: ROMJ) (OTC: ROMJF) from Tier 3 to Tier 2 due to the escalation in its revenue.

Canadian Cannabis LP Tier 1 Index

Tier 1 index increased 4.3% in July to 122.07 and soared 16.9% in August to 142.67 . Tier 1, which is now down 54.6% in 2022, dropped 17.7% in 2021 when it ended at 314.28. Among Tier 1 companies, Canopy Growth (TSX: WEED) (NASDAQ: CGC) soared 43.4% , while Organigram (TSX: OGI) (NASDAQ:OGI) was up just 2.9%.

Canadian Cannabis LP Tier 2 Index

Tier 2 index rose 1.7% to 145.85 in August. In 2021, it lost 17.1%, closing at 267.36, and it is now down 45.5% in 2022. Among Tier 2 companies, Cannara Biotech (TSXV: LOVE) (OTC: LOVFF) scored a 28.6% gain. The worst performing stock was Auxly (TSX: XLY) (OTC: CWBTF), which fell 33.3%.

Canadian Cannabis LP Tier 3 Index

Tier 3 index rose 4.5% to 24.40 in August. It ended at 47.42 in 2021, declining 19.9%, and is now down 48.5% in 2022.


New Cannabis Ventures maintains seven 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 and its three sub-indices. The sixth 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.

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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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