Weekly Review 07/15/22

Review

After a big down-day on Monday, the market popped on news Thursday that the Senate will be voting on the Cannabis Administration and Opportunity Act. Michigan grew 26% from a year ago and 0.5% from May in June to $187.4 million in cannabis sales. Illinois completed its reporting of June cannabis sales by disclosing the medical sales, which remained weaker Overall, sales grew 5% compared to a year ago to $155.3 million.

I distributed this written material to 420 Investor subscribers during the week:

Here are some of this week's highlights for Focus List names:

  • AYRWF launched adult-use sales at its second store in Massachusetts (Watertown).
  • CRLBF shareholders approved a move to repurchase all of the Super Voting Shares.
  • CURLF - launched Craft Farmers in California to encourage legacy growers and diversification.
  • CWBHF - is working with SBM, LLC, a benefits manager, to launch hemp CBD products.
  • FFLWF began delivery in BC
  • GTBIF - extended its debt maturity by a year to 4/30/25.
  • HBORF will change its name to StateHouse on the 25th of July. It cancelled a 6:1 reverse-split of its stock.
  • OGI - sales grew 20% sequentially to a record C$38.1 million, ahead of expectations, with adjusted EBITDA of C$586K.
  • PLNHF - will apply for a consumption lounge license in Las Vegas.
  • TCNNF - opened 2 new medical cannabis dispensaries in Florida.
  • TLLTF - suggested that the project with the Shinnecock Indian Nation in New York will open its doors in January.
  • TLRY - finalized its $155 million investment in HEXO Corp. convertible notes. It launched brand CANACA in Calgary.
  • VFF - announced that subsidiary Balanced Health Botanicals found in a research study that CBD and CBG can reduce temporary anxiety.
  • VLNS - revenue and adjusted EBITDA were a little behind expectations at C$24 million and -C$17.5 million.
  • VRNOF opened a Zen Leaf dispensary in WV, its third in the state and 105th overall. Then it opened another dispensary in Florida, its 52nd.

There were comments in over 110 discussions in the Forum. Don't miss out on this most informative part of 420 Investor! Not familiar with the the Forum? This video will help! This is a great way to track your favorite tickers, even those not on the Focus List, and to get your questions answered quickly.

Please check the Focus List, (which has technical, fundamental and valuation ratings as well as a market-cap table). To help track market caps, we maintain tables for the Canadian LPs and the American cannabis operators and ancillary companies.

Market Performance

The Global Cannabis Stock Index fell during the week, decreasing 3.2% to 15.06:

The index, which lost 26% in 2021 following a 5.2% gain in 2020, is down 54.2% in 2022. It currently includes 26 stocks and ended 2021 at 32.85: In July, it has rallied 2.0%.

For perspective, the index, which began 2013 at 100, bottomed in August 2013 at 70 after a prior peak of 220 in February 2013 and peaked in 2014 at 1010. The long post-2014 decline ended in February 2016, with the market soaring at the beginning of 2018 to levels not seen since 2014. We took out the 2016 lows by a wide margin in early 2020 and then soared into 2021 before reversing. We recently made a new all-time low:

Model Portfolios

Flying High ended the week valued at $207,462 up 18.4% in July and 6.3% during the week. . This model portfolio was launched on 9/23/13 with $10,000 (paper), and it ended 2013 at $18,225, 2014 at $15,702, 2015 at $9608, 2016 at $49,568, 2017 at $112,891, 2018 at $161,346, 2019 at $165,249, 2020 at $252,409 and 2021 at $294,249. The year-to-date gain was 16.6% in 2021, and the model portfolio is down 29.5% in 2022. The model portfolio has increased 1975% since inception. Flying High has 9 positions and 0.1% cash. During the week, I had several trades, including adding 3 new names and exiting 3.

420 Opportunity ended the week at $47,106, up 11.4% in July and 0.5% during the week. This model portfolio, which was funded with $50,000 (paper) on 4/8/14 and ended 2014 at $17,105, 2015 at $11,418, 2016 at $44,915, 2017 at $91,407, 2018 at $94,616, 2019 at $77,715, 2020 at $105,373 and 2021 at $90,823, has a goal of being fully invested and outperforming the market as measured by the 420 Investor Cannabis Stock Index, which lost 3.2% during the week. In 2021, the model lost 13.8%, while the index decreased 26.0%, and it is down 48.1% in 2022 compared to the index loss of 54.2%. The model portfolio has lost 6.1% since inception, while the overall market has declined by 98% during that time-frame. The model maintains 17holdings and 0.7% cash. The three largest holdings include CEAD/CEADW (12.9%), AAWH (10.3%) and AYRWF (10.1%). During the week, I swapped some CRLBF for CCHWF and later reduced the CCHWF. I also exchanged some AAWH for AYRWF. I did add some CGC as well.

420 Quality, which was funded with $50,000 (paper) on 3/1/17, ended the week at $66,106, up 1.0% this week and 11.2% in July compared to the index's 2.0% gain in July and 3.2% loss during the week. . In 2021, the model portfolio lost 21.8% compared to the 26.0% loss in the index. In 2022, it has returned -47.7% compared to the index return of -54.2%. It ended 2017 at $109,480, 2018 at $119,053, 2019 at $113,123, 2020 at $161,504 and 2021 at $126,323. To learn more about the model portfolio, which is longer-term focused, please read the description I posted before launch. Since inception, the model has gained 32.2%, while the index has lost about 81%. The model has 18 holdings and 1.2% cash. The largest positions include CEAD/CEADW (12.1%), AYRWF (10.4%) and AAWH (9.9%). During the week, I swapped some CRLBF for CCHWF and later reduced the CCHWF. I also exchanged some AAWH for AYRWF. I did add some CGC as well.

Calendar

As a reminder, 420i posts a calendar for your convenience, as does New Cannabis Ventures. NCV also posts a separate calendar for conference calls.

Companies with fiscal years ending in April (March for Canadian Venture stocks that don't file with the SEC) must report their annual financials in July.. This includes none from the Focus List. Companies with years ending in February, August and November must file their quarterly reports by mid-July (or by late July for Canadian-listed stocks that aren't on the TSX or NEO or filing with the SEC).

Posted to 420 Investor on Jul 15, 2022 — 4:07 PM
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