Global Cannabis Stocks Extend Torrid Rally in January with 28% Gain

After soaring 62% in Q4, the Global Cannabis Stock Index began the new year with a 27.8% gain to 56.71.

The index, which had 38 qualifying members during the month following the quarterly rebalancing at the end of December, increased 5.2% in 2020 to 44.39:

After posting an all-time closing low of 16.95 set on March 18th, the index has rallied sharply to end the month 234.6% higher but still down over 68% from its early 2018 closing high at 180.02:

The strongest 4 names in January all gained at least 76%:

The driver of the best performing stocks seems to have been the change of control of the Senate. Tilray, which led the way, was part of a very strong performance by the largest Canadian LPs. The company, which is being acquired through reverse-merger by Aphria, has traded above the price implied by the deal. Acreage Holdings tracked Canopy Growth but also saw the very steep discount to the price implied by the renegotiated “plan of arrangement” narrow as traders bet that the consummation could occur more quickly than previously expected. Each share of Acreage would be converted into .3048 shares of Canopy Growth at the time of acquisition. Akerna, which like Tilray and Acreage declined substantially in 2020, had no substantive news during the month. Aphria reported its fiscal Q2 during January, which helped extend its strong gains since the elections in November.

The 4 weakest names in January ranged from unchanged to down 17%:

Taat Lifestyle and Wellness, which is focused on tobacco-free alternatives to cigarettes that contain CBD, expanded distribution in Ohio, its first market, during January. PharmaCielo, which just joined the index at the end of December, retraced some of its strong Q4 gains. Planet 13, which priced its fourth equity offering since the summer during the month, also consolidated some of its recent gains. Clever Leaves, which recently went public through by merging with a SPAC, bounced early in the month but ended near its lowest price since closing.

We have also published separate reviews of the performance of the Canadian LP Index and the American Cannabis Operators Index:

We will summarize the index performance again in a month. You can learn more about the index members and the qualifications for inclusion by visiting the Global Cannabis Stock Index. A more complete analysis of the index is available at 420Investor.com. Be sure to bookmark the page to stay current on cannabis stock price movements within the day or from day-to-day.

New Cannabis Ventures maintains six 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.

Get ahead of the crowd by signing up for 420 Investor, the largest & most comprehensive premium subscription service for cannabis traders and investors since 2013.

Exclusive article by Alan Brochstein, CFA
Alan Brochstein, CFA
Based in Houston, Alan leverages his experience as founder of online communities 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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