Short-sell strategy hard to apply to Canada's marijuana stock – Toronto Star

By Jen SkerrittBloomberg

Fri., Dec. 15, 2017

Marijuana’s meteoric rise in Canada has spurred speculation of a bubble, but betting against the boom isn’t so easy.

Short-selling Canadian marijuana stocks is expensive, as the values of companies continue to climb and few shares are available to borrow, a key step in betting against a security. The brokerages of top Canadian banks don’t trade those stocks and smaller firms charge prohibitive interest rates to lend them.

“It’s harder to find that borrow, and that borrow is very expensive,” said Matt Bottomley, an analyst at Canaccord Genuity Group Inc. “It’s a hard industry to short.”

In short-selling, investors sell stocks that they borrowed when prices are high, with a view to buying them cheap later when they have to return the shares to the lender. They profit from the price difference minus the cost of borrowing.

Canadian marijuana stocks have ballooned as the nation marches toward legalization by July. The country’s top four producers are now worth more than $10 billion (U.S) after Canopy Growth Corp., the first marijuana unicorn, more than doubled this year, Aurora Cannabis Inc. more than tripled, Aphria Inc. gained more than 180 per cent and MedReleaf Corp. has climbed more than 60 per cent since its June debut.

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While investor optimism is being fuelled by estimates that there could be $6 billion in recreational sales by 2021, Canada and its provinces are still working out the details of how they will regulate, tax and distribute the products, and some publicly traded companies have yet to make a sale. Some analysts are skeptical about their demand projections.

But an investor willing to bet those risks

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Canada's marijuana stocks so hot it's difficult to bet against them – The Cannabist

Published: Dec 14, 2017, 11:18 am • Updated: Dec 14, 2017, 11:18 am

Pot’s meteoric rise in Canada has spurred speculation of a bubble but betting against the boom isn’t so easy.

Short-selling Canadian marijuana stocks is expensive as the values of companies continue to climb and few shares are available to borrow, a key step in betting against a security. The brokerages of top Canadian banks don’t trade those stocks, and smaller firms charge prohibitive interest rates to lend them.

“It’s harder to find that borrow, and that borrow is very expensive,” said Matt Bottomley, an analyst at Canaccord Genuity Group. “It’s a hard industry to short.”

Canadian marijuana stocks have ballooned as the nation marches toward legalization by July. The country’s top four producers are now worth more than C$10 billion ($7.8 billion) after Canopy Growth Corp., the first marijuana unicorn, more than doubled this year, Aurora Cannabis Inc. more than tripled, Aphria gained more than 180 percent and MedReleaf Corp. has climbed more than 60 percent since its June debut. While investor optimism is being fueled by estimates that there could be C$6 billion in recreational sales by 2021, Canada and its provinces are still working out the details of how they will regulate, tax and distribute the products, and some publicly traded companies have yet to make a sale. Some analysts are skeptical about their demand projections.

But an investor willing to bet those risks will eventually bring down the value of the stocks would have to pay a high price. The annual interest rate to short Aurora, Aphria or MedReleaf is upward of 20 percent, said Chris Damas, editor of the BCMI Cannabis Report.

The problem is most of the Canadian marijuana stocks are small to microcap companies held

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Marijuana Stocks Continue to Grow Ahead of California's Planned Legalization – Hacked

Marijuana stocks powered to new highs on Tuesday, as investors rallied behind the planned legalization of recreational cannabis in California next month.

Marijuana Index Rises Again

The closely watched North American Marijuana Index rose 5.5% on Tuesday to close at 189.58, which was enough for a new all-time high. The index has been on an absolute tear the past six weeks, having gained nearly 70% since Oct. 26. For the year, the index has returned roughly 32%.

Despite all the optimism surrounding the U.S. industry, it was Canadian stocks that did much of the heavy lifting in the early part of the week. Currently, the North American index is comprised of 35 companies. This includes well capitalized companies such as CannTrust Holdings Inc. (TRST) and  Cronos Group Inc.  (MJN).

The more segmented Canadian Marijuana Index added 8.3% on Tuesday to finish at 504.97. By comparison, the U.S. Marijuana Index added just 1.5% to 65.53.

In California, Full Legalization Nears

Beginning Jan. 1, Californians will be able to buy cannabis recreationally, a move that analysts say will kick start a multi-billion-dollar industry in the state. It’s a date that marijuana consumers and businesses have been waiting for since Proposition 64 was officially passed on election day 2016. After more than a year of speculation and anticipation, full-scale legalization is merely weeks away.

The green plant will be regulated by the state’s Bureau of Cannabis Control which, among other things, is responsible for licensing dispensaries and other cannabis-based businesses. In just a few weeks, any Californian aged 21 and over will be able to walk into a dispensary and purchase week, provided that the business has a temporary license from the state.

That being said, state-wide roll out is expected to be slow. Currently, only Oakland and a few Desert Hot Springs’

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Pot Stocks Gearing Up for Strong 2018 as Cannabis CBD Frenzy … – PR Newswire (press release)

PALM BEACH, Florida, December 12, 2017 /PRNewswire/ —

The hemp, cannabis and marijuana industry is booming while more and more retail investors are really taking notice. According to Cowen & Co., legal marijuana sales in the U.S. have the opportunity to reach $50 billion annually by 2026, with cannabis research firm ArcView projecting compound annual growth of 26% in North America through 2021. The cannabidiol (CBD) market alone is estimated to grow by 700% by 2020, according to Forbes. A new report by market intelligence firm Hemp Business Journal projects that the CBD market will grow to $2.1 billion by 2020, an astronomical jump in value compared to last year’s CBD market of $202 million. Plenty of market professionals firmly believe not many other industries and sectors are growing as quickly as legal marijuana heading into the new year. Active in the cannabis industry include: PotNetwork Holding Inc. (OTC: POTN), Global Payout Inc. (OTC: GOHE), GB Sciences Inc. (OTC: GBLX), Kaya Holdings Inc. (OTC: KAYS), Medical Marijuana Inc. (OTC: MJNA).

PotNetwork Holding Inc.  (OTC: POTN) today announces that the first segment of its auditing requirement has been completed, with 2017’s audit well underway. East West Accounting Services, LLC. has satisfied compliance parameters, and expects to have the full audit completed by the second week in January. The Company has taken this action as an initial step in its strategy to advance to the OTCQB, and long-term goal of achieving a NASDAQ Capital Market listing. Read this and more news for POTN at:  http://www.marketnewsupdates.com/news/potn.html

“We are very pleased that this segment of the process is completed.” states PotNetwork Holding CEO Rick Goulding. Registered by the Public Company Accounting Oversight Board (PCAOB), East West Accounting Services provides audit, review and consulting services to smaller capitalized public companies that need to provide financial

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Three stocks benefiting from the cannabis boom, even though they … – Financial Post

As the legalization of recreational marijuana in Canada next summer draws closer, investors have been piling into cannabis-cultivating companies, driving the shares of producers such as Canopy Growth Corp. and Aphria Inc. up more than 100 per cent over the past 12 months.

There is, however, more to the burgeoning industry than simply growing plants.

A Deloitte study on Canada’s coming recreational market predicted that sales could reach as much as $8.7 billion per year, but noted that the money from ancillary activities could boost the economic impact to more than $22.6 billion.

As a result, companies designed to support, service and supplement the sector are also seeing their shares bid up to unprecedented levels.
With that in mind, here are three fast-moving marijuana stocks that don’t necessarily grow marijuana:

Neptune Technologies & Bioressources Inc.

Medical marijuana is already legal in Canada, and Quebec-based Neptune, a manufacturer of nutritional supplements, is jumping into the market.

Neptune said in late November that it was now extending a licensing agreement for the use of its “patented omega-3 fatty acid delivery technology” in connection with products derived from cannabis.

“We will now begin investigating the impact of this innovative technology on the absorption and benefits of cannabis and cannabinoid ingredients,” said Jim Hamilton, chief executive of Neptune, in a release. The company says it has also applied for a licence to produce cannabis oil.

Echelon Wealth Partners said in a note that Neptune “is already exploring creative ways to marry cannabis oil with existing expertise in nutritional supplement co-formulation and distribution.”

“We also see no reason why oil-based cannabinoid formulations sold into nutritional/medical markets cannot grow as rapidly as recreational markets, if not faster,” wrote analyst Douglas Loe.

Shares of Neptune are up more than 65 per cent this year on the TSX,

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