Marijuana Money Archives - Green Market Report

Video StaffVideo StaffDecember 7, 2018

2min4020

The trading week was shortened as markets were closed on Wednesday to honor the funeral of the 41st president George HW Bush. Probably best since stocks took a beating on Tuesday.

On Monday, Cresco Labs became the latest multi-state operator to begin publicly trading on the Canadian Securities Exchange. Using the ticker CL, the stock opened at $8.50 and was lately trading at $C6.57.

Cronos Group stock skyrocketed after the company confirmed that it was speaking with tobacco giant Altria. While there is no additional news of a deal, it is anticipated to be a big one. Tobacco companies have shied away from cannabis until now presumably waiting until it was federally legal. It seems these companies have decided that to snooze is to lose.

Conversely, Aphria, which had been rumored in October to be speaking with Altria came under short seller attack. The stock plunged after Gabriel Grego called the company worthless. Eight Capital also cut its price target from C$22 to C$7 and the securities lawyers are lining up for business.

TILT Holdings began trading this week on the CSE using the symbol TILT. It also acquired cannabis distributor Blackbird for $50 million. Blackbird works with 250 wholesale and retail cannabis companies in Nevada and California. The company plans to expand into Massachusetts and Arizona and further in California.

High Times came to an agreement with THC Holdings to convert $28.6 million worth of debt to Class A common stock. The debt has been hanging over High Times and this removes the pressure of making those payments.

Origin House acquired craft cannabis company Cub CityCity for roughly $7 million.

Money continues to flow into the sector.

Ascend Wellness raised $40 million and believes this is one of the largest raises in Massachusetts. The company will use the money for expansion into other states.

OG DNA genetics raised $35 million.


Video StaffVideo StaffNovember 30, 2018

4min4510

The week kicked off with New Jersey making a bold move towards adult use legalization. The state approved proposals in the Senate and Assembly with the next step to send to the full chambers for a vote. The market is estimated to bring in $300 million in additional tax revenues for the state.

We got some new stocks to trade this week. Dixie began trading on the Canadian Securities Exchange this week using the symbol DIXI. Grown Rogue also began trading on the CSE with the symbol GRIN.

It was a busy week for earnings.

(Editors Note – Following the taping of Marijuana Money on Thursday, the market saw major earnings releases from MedMen and Acreage Holdings. In order to produce this video for Friday, it must be written and taped in advance. In some cases this means major news can occur afterward.)

KushCo Holdings (KSHB) said its revenue jumped 177% to $52 million. The net loss, including $1.0 million in depreciation expense, was $23.9 million in SG&A, and $1.6 million in provisions for income tax, was approximately $10.2 million compared to net income of $69,000 in fiscal 2017.

MedMen Enterprises (MMEN) (MMNFF) reported that its fiscal year 2019 first-quarter revenue grew 1,094% to $21.5 million over last year’s $1.8 million for the same time period. Still, the company reported a net loss of $66.5 million, or a loss of $1.42 per share, a dramatic increase over last year’s loss of $5.7 million for the same time period. This was a slight improvement over the net loss of $78.7 million for the fourth quarter last year.

Acreage Holdings Inc. (CSE: ACRG.U) announced its unaudited financial results for the third quarter, which ended on September 30, 2018. Acreage reported quarterly revenue of $5.5 million, representing a 160% increase when compared to the same period in the previous year. The company’s year-to-date revenue increased by 92% to $10.6 million. The company’s net loss increased from $0.7 million in the third quarter of 2017 to $4 million.

Charlottes Web (CWEB) which delivered revenue of $17.7 million. Net income fell slightly to $1.8 million, but gross profits increased 54% to $13.8 million.

Green Thumb Industries (GTII) reported that its revenue jumped 344% to $17.2 million, but the company delivered a net loss of $3.3 million.

GW Pharmaceuticals (GWPH) reported that its revenue declined to $2.4 million missing analysts estimates for $2.9 million. The company also reported a net loss of $79 million.  It wasn’t all bad because at the beginning of the week GW Pharm also said it had positive study results on a phase 3 trial for Epidiolex.

Canopy Rivers (CNOPF) recorded a net income in the quarter of $10.9 million.

MJardin’s (MJAR) revenue increased 65% to $7 million with a net loss of $400k.

Sunniva reported revenue of $3.8 million, but a net loss of $6.7 million.

In financial moves, Cura Cannabis Solutions raised $75 million in a private placement.

Altitude Investment Management closed its fund after raising $30 million with plans for a second fund to raise $100 million.

Green Gotham invested $15 million in LA’s The High Note.


Debra BorchardtDebra BorchardtNovember 23, 2018

3min6201

Happy Thanksgiving everyone. The stocks markets were closed yesterday, however, there was still had quite a bit of news to cover.

Massachusetts began selling adult use cannabis this week. Industry experts believe that the total Massachusetts cannabis market will exceed $1 billion annually generating hundreds of millions in taxes for the Commonwealth. Massachusetts has a population of 6.8 million people and over 47 million people live within a 4-hour drive of Boston, MA.

Two dispensaries were set to open to service customers. Cultivate Holdings, which has a retail shop in Leicester and New England Treatment Access (NETA) LLC in Northampton were given approval by The Massachusetts Cannabis Control Commission.

MedMen Enterprises (MMEN.CN) (MMNFF) stock was halted for trading following the company’s amended capital raise terms on November 9, 2018, MedMen made a deal for  C$120 million of subordinated voting share units priced at C$6.80.  Then the bottom fell out and the stock plunged to as low as C$5.39. Last Friday, MedMen decided to amend the terms of the deal and almost halved it to $75 million.  The IIROC required a revised prospectus and once that was approved, the stock went back to trading but was lately trading at roughly C$4.62.

TILT Holdings is one step closer to going public. The company raised $119 million closed its merger of Baker Technologies Inc., Briteside Holdings LLC, Sea Hunter Therapeutics, LLC and Santé Veritas Holdings Inc. (CSE: SV)

Florida’s Trulieve (CSE: TRUL) (TCNNF) reported that its third-quarter revenue came in at $28.3 million and a 42% increase over last year’s revenue of $19.8 million. The net income increased by 386% to $17.5 million. Trulieve announced that it was moving beyond the Florida market by making acquisitions of Life Essence, Inc. and Leef Industries, LLC., based in Massachusetts and California

Cannabis lab testing company EVIO Inc.  (OTCQB: EVIO) announced unaudited revenue for its fiscal 2018 fourth quarter It looks like for the year EVIO made approximately $3.3 million in revenues, an increase of 9.9% year over year

Aurora Cannabis (ACB) and ICC Labs Inc. completed the previously announced deal in which Aurora acquired all of the shares of ICC for $1.95 per share in a deal valued at approximately $290 million.


Video StaffVideo StaffNovember 16, 2018

4min6460

The MJ Biz conference happened this week. It’s the biggest marijuana conference in the country.. There are 25,000 people attending the conference here in Las Vegas.

But the biggest news this week is that Acreage Holdings began trading on the Canadian Securities Exchange using the symbol ACRG.U. The shares were priced at $25. The multistate operator is in 17 states and is valued at over $2 billion. Acreage hasn’t released any revenue projections and instead would like investors to focus on its extensive footprint.

However, Acreage wasn’t the only company to begin trading this week. MJardin acquired GrowForce in a deal valued at $275 million and the company began trading on the CSE. The symbol is MJAR. MJardin projects that it will bring in $162 million in revenue in 2019 according to an investor presentation. The 2020 estimates are for $325 million in revenue.

Think that’s it for new cannabis stocks today? You are wrong! Harvest also began trading on the CSE today with the symbol HARV. This multistate operator is operational in four states and has licenses for 11. The RTO has brought the company’s capital raise to $218m. The stock was priced at C$8.67, but opened lower at C$5.50 and then closed at $7, opened at C$5.50.

We had some big earnings this week too.

Canopy Growth (CGC) stock fell after the company missed analysts estimates. Canopy Growth reported that its second-quarter fiscal 2019 revenues jumped 33% to C$23.3 million, but analysts had estimated the company should have had revenues of C$60 million. Sales and marketing expenses were $7.6 million or 43% of revenue.

Tilray (TLRY) stock fell after the company reported third-quarter revenue of $10 million, an increase of 85% versus the same time period for last year. The company said that the average net selling price was $6.21 versus last year’s $7.53. The net loss for the quarter was $18.7 million or $0.20 per share compared to last year’s $1.8 million or C$0.02 per share.

Cronos Group (CRON) reported a 186% increase in third quarter revenuesto $3.8 million versus last years $1.3 million for the same time period. Gross profits were essentially flat with C$2.09 million for this past quarter versus C$2.0 million for the previous year.

The net loss increased to C$7.2 million for the quarter over last year’s net income of C$1.0 million. The net loss per diluted share was four cents versus last year’s net income per diluted share of one cent.

 

 


Video StaffVideo StaffNovember 9, 2018

3min5820

Cannabis arch enemy Attorney General Jeff Sessions resigned this week at the request of President Trump. If you’ll recall Sessions rescinded the Cole Memorandum and initiated lifetime bans at the northern border of people that work in the cannabis industry. It’s hard to say at this point whether the acting AG Matthew Whitaker will be for or against cannabis legalization, presumably he will be focused on the Russian investigation and not legalization issues.

We also got the results from the midterm elections this week and Michigan became the 10th state to legalize adult use cannabis. Missouri and Utah both legalized medical cannabis. North Dakota just said no to approving adult-use cannabis.

In New York, the state gained a democratic majority and many believe that this will result in legalizing adult use cannabis.

Golden Leaf is merging with Terra Tech (TRTC) after the company reported a net loss of $5.5 million in the third quarter. Revenues did climb to $5.1 million, but the value of its biological assets fell.

High Times has extended its stock offering to the end of November. The company said it wanted to accommodate additional investors that have resulted from the ad campaign as a result of the iHeart Radio deal. The iconic magazine also updated the market on declines in its revenue, but it seems the company’s expenses have fallen.

Green Growth closed on another C$30 million raise bringing the company’s total capital raise so far to $140 million.

Third quarter earnings have begun to roll in. Innovative Industrial Properties (IIPR) reported that its revenues climbed 150% to $3.9 million for the third quarter versus $1.6 million for the same time period last year. The company also delivered a net income of $1.5 million or $0.21 per diluted share. and IIPR said it would pay its sixth consecutive dividend.

Insys Therapeutics (INSY)  delivered a quarterly loss of $0.37 per share missing the Zacks Consensus Estimate for a loss of $0.20. The company also delivered revenues of $18.35 million, which also fell short of Zack’s estimate by 18%. Insys said that it was reviewing its portfolio of opioid assets including Subsys meaning it could be on the selling block.

Aphria (APHA) acquired German-based CC Pharma. Germany is key to the company’s international expansion.

Aurora Cannabis made a $20 million investment in the upscale chain called Choom.


Video StaffVideo StaffNovember 2, 2018

3min7052

Curaleaf began trading on the Canadian Securities Exchange on October 29 with the symbol CURA. The stock fell almost 20% on the first day of trading but quickly began to rebound. The company had an initial valuation of $4 billion.

The New York Stock Exchange listed Aphria Inc. and then delisted India Globalization Corp. Aphria stock will begin trading on the NYSE on November 2, while IGC shares have been suspended immediately. Diego Pellicer did a 20 to 1 reverse split and received a temporary stock symbol from the OTC Markets of DPWWD until November 30, when it will revert to DPPW.

Arizona is hot this week and not just temperature wise.

MedMen acquired Arizona-based Level Up in a cash and stock deal valued at $33 million. It includes licenses for 2 vertically integrated operations with retail stores in Scottsdale and Tempe. In addition, MedMen gets a 40% stake in K.I.N.D. concentrates and will get to put its locally made MedMen products in the Arizona stores.

Cresco Labs has acquired Arizona Facilities Supply for an undisclosed amount. It includes 2 cultivation facilities, a processing facility, and a dispensary.

Separately Sugarmade acquired the hydroponic supply company Sky Unlimited in a $40 million deal.

Lots of capital raises to go over.

Hydrofarm raised $55 million and said it is planning a 2019 IPO.

Tiger Global and Casa Verde combined to invest $50 million into seed-to-sale software company Metrc.

Wayland Group Raised $50 million, Indus Holding company raised $46 million. and Jane Technologies raised $6 million.

And finally, the Nevada Dispensary Association issued a report on the effect of legal cannabis sales to the economy. Currently, adult use cannabis sales account for 63% of all cannabis sales in the states, while medical sales make up the remaining 37%. Between 2018 and 2024, the state’s adult use cannabis industry is expected to generate an estimated $8 billion of economic activity.

Additionally, the industry is expected to support approximately 67,000 jobs in the same period. Cannabis regulations are also forecasted generate roughly $3.6 billion in direct, indirect, and induced labor income.

Direct spending in the cannabis industry is also projected during this period to have a multiplier effect of 1.63; which means that for every $1 spent on retail cannabis, another $0.63 will be generated throughout the state economy.


Video StaffVideo StaffOctober 26, 2018

3min7600

The broader stock market took a tumble this week and brought the cannabis stocks down as well. However, considering how high they had gotten, a little reversal seems healthy.

MedMen (MMNFF) reported fourth-quarter sales of $20.6 million and annual revenue of $39.8 million. Both increases over 1000%. Unfortunately, that came at a cost. The net loss was $66 million. But no worries, MedMen is sitting on almost $80 million in cash and will have numerous stores coming online in the near future through the many acquisitions the company has made. MedMen also uplisted to the OTCQX Best Market from the Venture market.

Scythian Biosciences had a big week. The company flipped its Florida property 3 Boys Farms to Verano and in exchange will get the multi-state properties from Verano’s portfolio. The exchange is valued at $100 million.

Namaste Technologies (NXTTF) closed on its previously announced bought deal including the over-allotment option for gross proceeds of $51 million.

Lots of housekeeping notes on stocks this week.

Aurora Cannabis began trading at the New York Stock Exchange this week using the symbol ACB. The company moved over from the OTC markets.

CannaRoyalty changed its name to Origin House and it will begin using the symbol OH in trading.

Marapharm  Ventures changed its name to Liht Cannabis and will use a new symbol LIHT.

Canaccord initiated coverage on The Green Organic Dutchman (TGOD)  with a Speculative Buy rating and a C$7 target price. The Canadian stock was lately trading at C$3.83. “While TGOD’s current focus is on increasing production capacity in Ontario and Quebec, we expect the company to be free cash flow positive in 2020 as it plans to build a portfolio of organic cannabis brands that will serve legal recreational and medical markets around the world.”

Bloomberg reported that Pax Labs was valued at $5 billion.

And 4Front holdings raised $31 million and putting itself solidly on the road to going public. 4Front will use the proceeds of the offering to fund its ongoing investment in top-tier talent, the build out in multiple states of its Mission-branded dispensaries and cultivation facilities, as well as for M&A opportunities


Video StaffVideo StaffOctober 19, 2018

5min7450

The big news this week, of course, was Canada. The country began its legal adult use cannabis sales on the 17th. While there weren’t necessarily a huge amount of dispensaries open, there were definitely some that began sales at midnight. Delta 9 (VRNDF) cannabis store reported that within the first minute of online sales, there were 100 orders and that sales for the day totaled $50,000. Products sold out within the first few hours.

In other Canada news, Acreage Holdings invited former Prime Minister Brian Mulroney to its board of directors.

iAnthus Capital (ITHUF) is acquiring MPX Bioceutical Corporation (MPXEF) in an all-stock transaction valued at $835 million. At a price of approximately $1.28 per MPX common share, its a premium of 30% based on the closing price of iAnthus and MPX common shares on October 17

Canopy Growth Corporation (NYSE: CGC) entered into an agreement to acquire the assets of hemp research company ebbu, Inc.  It is a cash and stock deal that is expected to close in November. Canopy Growth will pay C$25 million in cash and issue 6,221,210 company common shares to ebbu in exchange for the assets being acquired.

MedMen is selling three of its property assets to Treehouse Real Estate Investment Trust. This initial investment in the three properties will represent approximately $12.5 million in proceeds, after debt repayment. The properties sold will be leased back to MedMen so the medical cannabis giant and its subsidiaries can continue to operate in its original properties.

Lots of housekeeping news on stocks

Aurora Cannabis Inc. said that its shares have been approved for listing on the New York Stock Exchange and will begin trading at the open of markets, October 23, 2018.

CannAmerica Brands began trading on the Canadian Securities Exchange under the symbol “CANA”.

Elev8 Brands, Inc. (OTCQB: VATE), was approved for trading on the OTCQB Venture Market.

In earnings:

India Globalization Capital Inc. (IGC) is – a cannabis company that doesn’t sell cannabis and is listed on the New York Stock Exchange. The company only books revenue from its legacy business of trading commodities and heavy equipment rental. For the three months ending September 30, this was $811,000. The net loss for the quarter was $858,000. There is no revenue from cannabis products at this time.


Video StaffVideo StaffOctober 12, 2018
marijuanamoneyminute-1280x743.jpg

5min8360

MedMen (MMNFF) continues its spending spree. This week the company is buying Pharmacann in a deal valued at $682 million. Pharmacann is a medical marijuana operator with 10 retail stores and three cultivation and production facilities across multiple states. MedMen’s network nearly doubles with this deal and will now have a portfolio of cannabis licenses in 12 states to operate 79 cannabis facilities.

Seed-to-sale technology provider MJ Freeway has agreed to a merger with MTech Acquisition Corp., which is the first US-listed Special Purpose Acquisition Company focused on acquiring a business ancillary to the cannabis industry. MTech and MJ Freeway will become subsidiaries of a newly-formed holding company to be listed on the NASDAQ (NDAQ) Stock Market.

A report from Canada suggested that tobacco giant Altria is considering a minority investment in Aphria. Both companies were evasive when asked if they were considering a deal, but it seems Altria folks were spotted at the Aphria headquarters.

Aurora Cannabis Inc. (ACB) announced that it has filed an application to list its shares on the New York Stock Exchange (ICE). The company said that it expects to begin trading on the NYSE by the end of October under the symbol “ACB.”

Green Acre Capital has announced that it has received more than $75 million for the initial closing of Fund II. With funding in hand, the company said that it will begin making investments and plans to stop taking capital within the next 30 days; focusing on ancillary cannabis companies

Vivien Azer of Cowen & Co reiterated her Outperform rating on both Canopy Growth and Tilray. Azer lifted the price target for Tilray from $62 to $172 and raised the price target for Canopy’s Toronto-traded shares from the U.S. dollar $57.17 to $63.35.

Next week on October 17th Canada will begin selling legal adult use cannabis, so get ready for an avalanche of cannabis news from the great white north.

Following the taping of the Marijuana Money video Aphria (APHQF) first fiscal quarter of 2019 ending August 31 revenue rose 117% to C$13,392 from $6,120 for the previous year for the same time period.  The company said that adjusted gross profit for the first quarter was $8,458, with an adjusted gross margin of 63.6%, compared to $9,468 with an adjusted gross margin of 78.7% in the prior quarter. The decrease in the adjusted gross margin and adjusted gross profit from the prior quarter largely relates to an internal decision to dispose of 13,642 plants prior to harvest.

Net income was $21,176 or $0.09 per share, as opposed to $15,041 or $0.11 per share in the prior year. The increase in net income for the quarter relates to gains on our long-term investment portfolio, primarily our investments in Liberty Health Sciences and Hiku Brands Company Ltd. and the increase in fair value of biological assets caused by the production increase associated with our Part III Expansion project.

 


Video StaffVideo StaffOctober 5, 2018

3min6290

MedMen had a busy week. The company acquired a Scottsdale Arizona cannabis company Monarch including the dispensary and cultivation operation. It comes with all the licenses and some exclusive brand agreements. MedMen also acquired Chicago-based dispensary Seven Point this week and announced that it closed on a $73 million loan facility, which immediately got bumped up another five million.  

Dixie Brands is the latest to declare a reverse take over to go public in Canada. The cannabis beverage company will take over Academy Explorations. The company also completed $25 million fundraising round.

Innovative Industrial Properties (IIPR) began a public offering of 2.6 million shares. It is priced at $40.00 per share for gross proceeds of $104 million.  intends to use the net proceeds from this offering to invest in specialized industrial real estate assets that support the regulated cannabis cultivation and processing industry.

GW Pharmaceuticals (GWPH) said it planned on selling $300 million of ADS’s with a possible overallotment of $45 million. GW will issue 1,900,000 American Depositary Shares, representing 22,800,000 ordinary shares of GW, at a price to the public of $158.00 per ADS on the Nasdaq Global Market, raising gross proceeds of approximately $300 million (before deducting underwriting discounts, commissions and offering expenses).  GW has granted the underwriters a 30-day option to purchase up to an additional 285,000 ADSs at the public offering price less underwriting discounts and commissions.  It is expected to close on or about October 5, 2018.

Cannex Capital Holdings (CNXXF) reported that its revenues increased 223% to $3.4 million in its fiscal first quarter. Net income was $2.4 million versus a loss last year of $403 thousand for the ame time period. Revenue was generated primarily by way of packaging sales and rental income. Income for the period was $2,428,507 for Q1 2019, $.01 per share, as compared to a loss of $403,027 for the comparative period.

Aleafia Health (ALEAF) applied to list on the NASDAQ. The company currently trades in Canada on the OTC markets.

Hollyweed North Cannabis acquired Women Grow for an undisclosed amount.

 

 



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