Soaring MSOs Lead Cannabis Stocks Higher in January

As we described in a previous article, the Global Cannabis Stock Index extended the bounce from November after the huge October loss, rallying 8.1% in December. That index was down 20.1% in 2023, which followed a record decline of 70.4% for 2022. In January, it rallied again, rising 12.2% to 9.10.

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 and in September but led the way lower in October and reversed in November, was the weakest in December. It led the way higher to begin the year and was the only index to rally.

American Cannabis Stocks Index

The American Cannabis Operator Index was quite strong after declining in December. In January, it soared 40.0% to 21.48 :

In 2023, the index rallied 7.6% despite the overall weakness in cannabis stocks, and a late January close was the highest close in over a year:

The index, which launched in October 2018, made all-time low in August before soaring. It is still down a lot from when it launched:

The best performing MSO in January was AYR Wellness (OTC: AYRWF) (CSE: AYR.A), which soared 95.1%. Cannabist Company (OTC: CBSTF) (NEO: CBST) was the weakest stock, rising 5.4%. It was the strongest member in December.

In January, the index will still have 13 members, with Flora Gold (OTC: GRAM) (NEO: GRAM) joining.

Ancillary Cannabis Index

The Ancillary Cannabis Index was weak again, falling 5.1% to 12.70:

In Q4, the index lifted 0.9%. After a massive loss of 76.6% in 2022, it declined 10.9% in 2023 to 13.38, which was better than the Global Cannabis Stock Index:

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

The best performing stock in the index in December was Chicago Atlantic (NASDAQ: REFI), rising 5.2%, the only gainer of the index. The worst stock was Scotts Miracle-Gro (NYSE: SMG), declining 11.7%.

In January, the index will have seven members again.

Canadian Cannabis LP Index

The Canadian Cannabis LP Index was weak to begin the year falling 0.7% to 60.41:

The index, which fell 62.8% in 2022, was down 16.2% in 2023 to 60.85:

The LP index, which had made a new all-time low several times last year, is down a lot from its peak:

The Canadian LPs trade mainly below C$1, with just just four of the stocks having a higher price at the end of January. 13 of the 20 stocks in the index closed below C$0.25. During January, Organigram (TSX: OGI) (NASDAQ: OGI) soared 30.2%. The other large LPs all fell, including Tilray Brands (TSX: TLRY) (NASDAQ: TLRY), which led the way lower with a 19.9% decline. Canopy Growth (TSX: WEED) (NASDAQ: CGC) fell by 6.5%, while Cronos Group (TSX: CRON) (NASDAQ: CRON) dipped 1.8%.

In February, the index will have 19 members, as Aleafia has been removed.

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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