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EXCLUSIVE: Why WisdomTree's CIO Is Bullish On Japan's 'New Corporate Culture,' Buffett-Style Investment

WisdomTree Chief Investment Officer Jeremy Schwartz spoke with Benzinga about the unparalleled potential nestled within Japan’s economic landscape.

What Happened: Benzinga asked Schwartz which country’s economy the ETF provider views as the most promising.

Japan, said Schwartz, which has investment appeal largely due to its transformative “new corporate culture.”

A seismic shift toward shareholder-friendly practices characterizes the nation, he added.

Schwartz also pointed to the growing cohort of Japanese companies embracing shareholder value maximization through increased dividends and buybacks — a testament to a newfound commitment to investor returns.

See the chart below.

Chart: Benzinga Pro

Buffett Is Bullish On Japan, Too

Central to Japan’s investment appeal is a resounding endorsement from Warren Buffett.

The so-called “Oracle of Omaha” has unreservedly declared Japan as the premier destination for deploying fresh capital outside of the U.S.

Buffett has directed investments into five distinct Japanese trading companies in a strategic move indicative of Japan’s attractiveness. The move underscores his unwavering confidence in the nation’s economic trajectory.

Moreover, Buffett’s endorsement serves as a compelling catalyst for foreign investors, reigniting interest and revitalizing confidence in Japan’s market potential.

As foreign capital flows back into the country, Japan emerges as a magnet for investors seeking to capitalize on its growing opportunities.

Related: Warren Buffett’s Berkshire Hathaway Raises Stake In 5 Japanese Trading Houses

WisdomTree ETF Has A Similar Approach To Buffett

Navigating Japan’s investment landscape presents unique challenges, notably the Japanese yen’s volatility.

According to Schwartz, “it is impossible to predict the direction of the yen.”

In response, Buffett has adopted a prudent approach. He neutralizes exchange rate risk by issuing yen-denominated bonds — an astute strategy to safeguard investments against currency fluctuations.

Enter the WisdomTree Japan Hedged Equity ETF (NYSE:DXJ). The ETF seeks to harness the power of currency hedging to mitigate exchange rate volatility and amplify returns.

The appeal of the ETF lies not only in its strategic hedging mechanisms but also in its compelling value proposition, Schwartz told Benzinga. By earning the carry in hedging instruments — a substantial margin bolstered by the disparity between U.S. and Japan interest rates — the ETF offers investors an avenue to capitalize on Japan’s economic resurgence while neutralizing FX risk.

The WisdomTree Japan Hedged Equity ETF has witnessed a remarkable growth trajectory — up 47% over the past year and 21% YTD. The fund’s investment strategy leverages Japan’s newfound corporate ethos.

Other Japan-focused ETFs such as the iShares MSCI Japan ETF (NYSE:EWJ) and the JPMorgan BetaBuilders Japan ETF (NYSE:BBJP) are also up 4.96% and 5.41%, respectively.

Japan stands at the precipice of a new era — a paradigm shift marked by a revitalized corporate culture and a resolute commitment to shareholder value maximization. For investors seeking to capitalize on this transformative journey, Japan could represent a golden opportunity.

Read Next: Invest For The Decades, Not The Years

Image: Shutterstock

EXCLUSIVE: India To Lead Emerging Markets, Driven By Modi's 'Pro-Business Environment,' Says WisdomTree CIO

In a landscape teeming with global investment opportunities, one nation shines with resolute promise: India. In an exclusive interview with Benzinga, Jeremy Schwartz, global chief investment officer at WisdomTree, revealed compelling insights that position India as an investment powerhouse.

What Sets India Apart

Among the developed and emerging markets, WisdomTree’s strategic vision spotlights India as one of its top picks alongside Japan. According to Schwartz, India “is positioned as the leader of emerging markets (EM).” What sets India apart is its undeniable dominance among the EMs which is propelled by robust population growth—a demographic dividend that fuels unparalleled GDP expansion, he notes.

Moreover, India’s economic prowess finds validation in its equity market performance, emerging as a frontrunner among its emerging market counterparts.

Chart: Benzinga Pro

Indian Equity Has Outperformed Other Emerging Markets

The Indian equity-tracking WisdomTree India Earnings Fund ETF (NYSE:EPI) has returned 9.43% so far this year. Chinese equity-tracking iShares China Large-Cap ETF (NYSE:FXI) and Brazilian equity-tracking iShares MSCI Brazil ETF (NYSE:EWZ) have returned +8.61% and -9.34% over the same period.

Schwartz also noted that “interest in China has become more contentious with geopolitical headwinds and sluggish economic growth” causing investor attention to pivot towards India, as investors seek stability and growth in an increasingly uncertain global landscape.

Schwartz draws attention to India’s investment appeal being validated by the sustained momentum of the WisdomTree EPI ETF. The fund has witnessed substantial inflows quarter after quarter since 2023. This surge in investor interest underscores the growing confidence in India’s economic trajectory and its burgeoning equity market potential.

For additional perspective, Indian-equity tracking ETFs have all delivered decent returns so far this year.

Chart: Benzinga Pro

While the EPI has clearly led, returning 9.43% to investors so far this year, other funds such as the iShares MSCI India ETF (NYSE:INDA), the Franklin FTSE India ETF (NYSE:FLIN), the iShares MSCI India Small-Cap ETF (NYSE:SMIN) and the iShares India 50 ETF (NYSE:INDY) have each returned 7.13%, 7.06%, 6.80% and 2.69%, respectively, YTD.

Also Read: Apple’s Pivot-From-China Gamble Pays Off: 1 In 7 iPhones Now Made In India

Schwartz Identifies A Pivotal Catalyst – Prime Minister Narendra Modi’s Success In The Spring Elections

A pivotal catalyst for India’s continued success lies in the upcoming spring elections in India.

“WisdomTree believes Prime Minister Narendra Modi‘s Bharatiya Janata Party looks like it will be successful in the upcoming spring election as well,” said Schwartz. This electoral victory would herald a stable environment conducive to further economic expansion and sustained equity market growth.

“We expect Prime Minister Modi to engage in further economic reforms that will continue his pro-business environment,” he added.

WisdomTree’s unwavering confidence in India’s economic resilience is underpinned by Modi’s pro-business agenda. According to Schwartz, his success should help usher a new era of economic reforms.

As India embarks on this transformative journey, investors stand to reap the rewards of a burgeoning economy poised for exponential growth.

Read Next: China Accounts For ‘Nearly Half Of Asia-Pacific GDP’ While India Is A ‘Bright Spot,’ Economist Says: Key ETFs To Watch

Photo: Shutterstock

Marijuana Consumers Are Dealing With Information Overload, Experts At Benzinga Cannabis Conference Discuss Improving Retail Experience

“That menu is certainly critical,” John Hartmann  CEO of Ascend Wellness Holdings (OTC:AAWH) said to those gathered at the Benzinga Cannabis Capital Conference in Florida on April 16-17 in a conversation about how to best attract retail consumers. 

“They’re looking for variety in the products,” he continued.”And so whether that’s the strength of the THC or the terpene component, or whether it’s a different form factor. I think having a really well-balanced menu that meets the needs of a variety of customers is something we’re focused on.” 

Hartmann joined three other industry experts – Kyle Sherman, founder & CEO of Flowhub, Jon Lowen, co-CEO of Surfside Solutions Inc. and Ankur Rungta, co-founder and CEO of C3 Industries. The panel, “Is your retail experience what consumers are really looking for?” was moderated by Rachel Wright managing partner at 420 CPA and host of Highly Capitalized Network News Highly Capitalized. 

Value Points, Tech & Consistency 

The head of a vertically integrated cannabis company with a national presence, Rungta, highlighted that nowadays “consumers are very, very value-focused,” and value points include not only the right high-quality products, but also “pricing, assortment, and promo strategy.” He added it is important to make the offering exciting for all different types of consumers.

For Sherman, a CEO of the cannabis retail and payments platform for dispensaries nationwide, the tech is crucial. “It’s funny tech is such a behind-the-scenes thing, right?” he asked. “It’s pretty easy to forget that.” 

Sherman stressed that tech is really important, all the way from the first moment that a consumer walks into a store and they get their ID scanned. He was touring around the country and found out that in some dispensaries it takes 10 minutes to check in, which could make some customers wonder why they would go back there. Next to the check-in process is the experience of interacting with the budtender, which is also a point where tech can help, as it can provide the budtender with a lot of information on the customer’s purchasing habits. 

Wright pointed out that consistency is also another important detail to keep the customers in addition to the efficiency of time. Customers like to have consistent experiences in the same stores at different locations. 

See Also: Banking-Fit Means Your Cannabis Business Is At The ‘Pinnacle Of Fitness,’ Experts Explain At Benzinga Conference

Focusing On The Lion’s Share Of Revenue

Lowen, who is at the helm of a marijuana-focused provider of marketing and data solutions, followed up by saying it is important to use technology for communication. If these customers love flower or pre-rolls, when they walk in they should see flower and pre-rolls.

“We want those product listings to show up first,” Lowen said. “We want those products that they’re the most interested in based on maybe previous exposure to different purchases or interests that they’ve shown up from a data perspective so that we can create this continuous flow of communication and content.” 

Rungta followed up by saying that “every store has its own unique sort of customer base and demographics and purchasing habits,” and that it is really hard to generalize even across a single state, let alone across a whole business. His business is seeing 80% of sales coming from 20% of its customers, and those customers are buying certain products like flower.

It is important to focus on the lion’s share of the revenue, Rungta said, adding “The more you try to generalize in this space, the more you’re going to struggle from a performance standpoint.”

Information Overload 

Hartmann explained that there are three types of customers – very experienced who know what they want, the ones who enjoy the community of the dispensary and the third group is the newest, comprised of people who want to learn. Those new ones, however, could end up representing 80% of your sales, “but they need some education sometimes hand-holding.” 

Rungta cautioned that a lot of customers are dealing with “information overload,” especially very competitive markets, and are getting bombarded with advertisements. The businesses should try to declutter that information to cut through the noise. 

Harmann added about another important factor – getting customer feedback, concluding “it’s all about the customer.”

Now read: The Court Case That Could Change The Cannabis Industry Forever And How It Affects Rescheduling

EXCLUSIVE: Why This Uranium Bull Market Is Different — 'We've Really Got To Start Developing Mines,' Says Madison Metals CEO

Uranium prices have more support now than they did when the nuclear fuel hit its all-time high in 2007, according to the chief executive of uranium explorer Madison Metals Inc. (OTC:MMTLF).

Back then, when uranium reached a record high above $130 per pound, physical supply was tight because of flooding at two major mines, falling recoveries from old nuclear warheads, expectations of a nuclear renaissance and the launch of uranium futures in New York.

But the high price proved to be a bubble, quickly falling as end users stopped buying and financial services companies sold the metal. Later, in 2011, a disaster at a Japanese nuclear reactor sent the uranium market into a deep slump for years as nations shut down nuclear reactors.

The underlying fundamentals are “dramatically different” now, CEO Duane Parnham told Benzinga.

Also Read: Uranium Execs Talk High Prices, Tout Projects As Long Downturn Comes To An End: ‘The US Government Will Be Buying’

The tables have indeed turned. Around 60 reactors are under construction around the world, and an additional 110 are planned, according to the World Nuclear Association. That’s in sharp contrast to the 65 reactors that, according to the International Atomic Energy Agency, were shut down or didn’t have their life spans extended between 2011 and 2020.

The threat of climate change has helped temper opposition from environmentalists concerned about safety and waste. At the United Nations climate conference last year, 22 nations pledged to triple nuclear generation by 2050 from a 2020 baseline.

The energy transition away from fossil fuels toward net zero emissions though electrification means there will be a much greater need for carbon-free power generation, and wind and solar currently aren’t able to meet base load power generation requirements.

“Nuclear really became the solution to that,” Parnham said. “It’s becoming more accepted.”

According to a base case scenario from the World Nuclear Association, global demand from reactors could hit almost 130,000 metric tons by 2040, up substantially from the estimated demand of about 65,650 metric tons this year. But by 2040 supply from existing, prospective or planned mines or those now under development may total less than 80,000 metric tons, the group said.

“We’ve really got to start developing mines now,” Parnham said.

Mine development and exploration has been underfunded because of the longtime slump in uranium prices, which dipped below $20 a pound in 2016. 

Meanwhile, uranium purchases from investors and trading firms have become “significant,” Parnham said. 

On top of utilities buying uranium for reactors and governments making purchases for strategic stockpiles, demand from financial services companies “dries up what little supply is out there,” he said.

One of the most prominent examples is the Sprott Physical Uranium Trust (OTC:SRUUF), which is an exchange traded fund that sells shares backed by physical uranium held in storage. Since its inception in 2021, the fund has amassed nearly 64 million pounds of uranium.

The buying from the financial market creates price volatility because the financial players will “flood the market” when prices start to come down, he said. 

There may come a time when so much financial services money is entering the uranium market that governments will have to step in with regulation, but “we’re a ways away from that,” he said.

In the meantime, the higher uranium price is spurring merger and acquisition activity among uranium miners, as acquisitions offer the quickest way to grow, he said. 

Indeed, recent merger and acquisition activity in the uranium space has included Premier American Uranium Inc. (OCT: PAUIF) and American Future Fuel Corp. (OTC:AFFCF); Boss Energy Ltd. (BQSSF) and enCore Energy Corp. (NASDAQ:EU); ATHA Energy Corp. (OTC:SASKF) and Latitude Uranium Inc. and 92 Energy; and IsoEnergy Ltd. (OTC:ISENF) and Consolidated Uranium Inc.

“Pricing does motivate M and A,” Parnham said.

Now Read: Ur-Energy To Develop Wyoming Uranium Mine As Prices Soar, Sales Contracts Grow

Photo: Shutterstock

EXCLUSIVE: Madden Gaming Veteran Leads Play-To-Earn Horse Racing Game Photo Finish Into New Growth Phase: 'More People Racing All Day, Every Day'

Leading play-to-earn virtual horse racing game Photo Finish LIVE offers sports fans and Web3 enthusiasts opportunities to play and earn through racing, breeding and staking.

Benzinga talked to the founder of Third Time Entertainment, parent company to Photo Finish LIVE to hear more about how the company started and what’s next.

Launching Photo Finish: After launching several successful horse racing mobile games, gaming veteran Ian Cummings had the idea to launch a Web3-based horse racing game.

Cummings said the success of NBA Top Shot and Axie Infinity were NFTs that helped push the thought process into making a horse racing game for the Web3 audience. Third Time Entertainment talked to several blockchains before settling on Solana (CRYPTO: SOL), the blockchain that launched the initial Photo Finish PFPs.

Third Time’s goal was to bring its current mobile user base over to Web3.

“We’ll teach them about blockchain,” Cummings told Benzinga.

Cummings said the shock was that none of them cared and many didn’t have the ability to trade NFTs on a PC.

Instead, it was a massive viral rush of fans from within crypto that helped Photo Finish gain interest.  

“It didn’t end up how I expected. We found a brand new audience.”

Cummings credited his past experience working at companies like Electronic Arts (NASDAQ:EA), Zynga and FanDuel for helping to give him the tools and knowledge to launch a successful game.

Cummings started as a tester at EA for the well-known Madden NFL game. Cummings spent the majority of his 20s working his way up to become the person in charge and run Madden. While working on Madden he worked on items like animation, gameplay, franchise mode, owner mode, playbooks and was the creator of the “Hit Stick,” a popular Madden game feature.

After being burned out as being in charge of Madden — a job that came with lots of meetings and presentations — Cummings shifted to Zynga where he learned firsthand the big shift for the gaming sector to digital and mobile games, including free-to-play.

“Zynga taught me a lot about monetization.”

Related Link: Here’s How Much $100 Bet On Mage To Win Kentucky Derby Paid Out — And How You Could Have Owned Shares In The Horse For $50

Horse Racing Market: While many in North America focus on following the main four sports of baseball, basketball, football and hockey, Cummings said horse racing is the forgotten sport by the media.

The success of the Kentucky Derby, which gets more popular every year, shows the interest in horse racing, Cumming added. The unfortunate item is that many smaller tracks are falling off and having to subsidize with casinos being built, Cummings added.

While it has a smaller in size in North America, Cummings said horse racing is hugely popular in Australia, Ireland, the U.K. and Japan. The sport has hundreds of millions of people globally who are passionate about it.

“We could go serve this niche,” Cumming said of building a horse racing game.

Playing Photo Finish: The Photo Finish game offers all things horse racing including racing, claiming, breeding and a marketplace that sees users buy and sell horses directly from each other, with Third Time taking a cut via fees.

The game also has the CROWN token, which Cummings said came as a thought from the early days and is something they approached differently than what others were doing.

Cummings said the magic of a cryptocurrency token, if integrated correctly into a game, is it can be used for user acquisition instead of paying Facebook to get users.

Players can buy CROWN and also earn CROWN for races. CROWN can also be staked to become a part owner of a horse track and earn a portion of the season’s earnings. For Photo Finish a season is four weeks long.

Cummings told Benzinga that most video games are successful if they sell a lot of copies or in-app purchases to the users. For Photo Finish, the platform is about users and the game makes money from fees to use the platform and complete items like breeding and selling horses.

The key measure of success for Cummings is seeing “more people racing all day, every day.”

Cummings said the game offered lots of ways to play and it’s important like poker to study and research the angle you want to take. This can include building large stables and racing every day for lovers of daily fantasy, breeding for long-term focused players, buying horses in claimers and flipping for profit for those with a keen eye.

Users can sign up and get a free training horse with just an email address.

What’s Next: Third Time Entertainment has a partnership with Churchill Downs, Inc. (NASDAQ:CHDN), the owner of the Kentucky Derby.

A season of the Photo Finish includes a Virtual Kentucky Derby, something Cummings said helps give players a goal of winning the key race.

For this year’s 150th running of the Kentucky Derby, Photo Finish will launch several key marketing items that will be announced in the future ahead of the race on May 4.

Photo Finish and Churchill have been feeling each other out as part of the multi-year partnership, Cummings added. This includes co-marketing efforts in the past and future initiatives.

Cummings also told Benzinga the goal is for the mobile app to launch this year, which could unlock new territories for players.

Another key for Cummings is getting an official gambling license in more countries. Operated as a skill-based game in the U.S., Photo Finish allows wagering on races in some markets.

Read Next: Churchill Downs Analyst Sized Up High Quality Kentucky Derby Asset, Project Pipeline 

Photo: PhotoFinish

EXCLUSIVE: Netflix Users Ready To Cancel Memberships If Prices Are Raised

Streaming giant Netflix Inc (NASDAQ:NFLX) added 9.33 million net new paid global subscribers in the first quarter.

But an imminent plan price hike could push people away or to cheaper plans, recent data reveals.

What Happened: Benzinga recently polled its readers to ask what they would do if Netflix raises its prices. Here are the results.

“If Netflix raises prices on its streaming plans, what would you do?” Benzinga asked.

  1. Cancel membership: 55%
  2. Move to ad-supported tier: 10%
  3. Keep subscription if $1 to $3 price increase: 24%
  4. Keep subscription no matter what: 11%

More than half of Benzinga readers polled are ready to cancel their membership if monthly costs rise.

However, a portion of Netflix subscribers will likely keep their plans if the price increase is minimal ($1 to $3) or opt for the ad-supported tier.

Benzinga asked a similar question on X in March. Here are the results.

“If Netflix increases their price by $5/month, what would you do?”

  • Cancel: 58.3%
  • Pay It: 20.1% Swear: 11.2%
  • Cry: 10.4%

The poll had similar results of around half of subscribers ready to cancel their Netflix plans if prices rise.

Related Link: Netflix Stock Sized Up By 7 Analysts Post Q1 Results: ‘Pivot From A High-Growth, Low-Profit Business To A Slow-Growth, High-Profit Business’

Why It’s Important: Consumers report spending more monthly on streaming plans and many are ready to get rid of platforms.

Netflix last raised prices on its Standard plan in the U.S. in January 2022. A potential price hike was one of the many items analysts and investors were watching for in quarterly results from the company.

The streaming company didn’t announce a price hike, but consumers still fear one is coming, which comes as

Netflix shared in its fourth-quarter shareholder letter that price hikes were likely coming to the U.S.

“As we invest in and improve Netflix, we’ll occasionally ask our members to pay a little extra to reflect those improvements, which in turn helps drive the positive flywheel of additional investment to further improve and grow our service,” the company said.

Netflix raised the prices of its Basic plan from $9.99 per month to $11.99 and Premium plan from $19.99 to $22.99 in October 2023 for U.S. subscribers.

The popular Standard plan, which is priced at $15.49, has not increased since January 2022 when the plan went from $14 to $15.49.

The streaming market remains competitive. Consumers often subscribe to plans with the largest content libraries and the platforms with the best content. Netflix has traditionally ranked well in both categories of content library and must-see content.

With Netflix having the ad-supported plan available for $6.99 per month, the company could see less people completely leave their streaming ecosystem.

NFLX Price Action: Netflix shares are trading at $549.51 at last check Monday versus a 52-week trading range of $315.62 to $639.00. Shares of the streaming company are up over 70% in the last year.

The study was conducted by Benzinga from April 18, 2024 to April 19, 2024, and included the responses of a diverse population of adults 18 or older. Opting into the survey was completely voluntary, with no incentives offered to potential respondents. The study reflects results from 217 adults.

Read Next: EXCLUSIVE: Streaming Platform Winner Picked By Benzinga Readers: Did Disney+, Netflix, Amazon Prime Video Or Max Take Top Honors?

EXCLUSIVE: Adial Pharmaceuticals Tells Benzinga 'This patent expands Adial's intellectual property protection and covers the combination of the Company's proprietary genetic diagnostic to identify patients with specific genotypes
EXCLUSIVE: Adial Pharmaceuticals Tells Benzinga Co. Granted Key Patent From The United States Patent And Trademark Office
EXCLUSIVE: Alcohol Disorder Focused Adial Pharmaceuticals Secures US Patent

On April 16, 2024, the United States Patent and Trademark Office issued patent number 11957664 to Adial Pharmaceuticals Inc (NASDAQ:ADIL). 

This patent expands Adial’s intellectual property protection and covers the combination of the company’s proprietary genetic diagnostic to identify patients with specific genotypes for genetically targeted treatment of alcohol use disorder (AUD) and other drug dependencies, such as opioid use disorder (OUD), with the company’s lead investigational new drug product AD04.

Related: EXCLUSIVE: Adial Pharmaceuticals Announces New US Patent Covering Its Molecular Genetic Diagnosing For Alcohol, Drug Dependence.

Cary Claiborne, CEO of Adial, commented, “We are proud to have secured this new patent, which covers important aspects of the combination of our proprietary genetic diagnostic and AD04 to treat AUD, OUD, and other drug dependencies.” 

“Importantly, we have identified specific genotypes that responded with clinically meaningful changes in drinking behavior compared to placebo in the AD04 post hoc analysis, representing an addressable market of approximately $40 billion in the U.S. alone,” Claiborne added.

In February, Adial Pharmaceuticals received a U.S. patent allowance covering AD04 and its ability to target the serotonin transporter gene for the potential treatment of opioid use disorder.

Earlier this month, Adial Pharmaceuticals exclusively told Benzinga regarding the publication of a peer-reviewed article highlighting the clinical results, strong safety profile, and high compliance among patients administered AD04 (low-dose ondansetron).

The publication also reported the results of a new study analyzing the liver safety profile of AD04 compared with placebo in subjects with AUD in the company’s prior Phase 3 trial. 

Price Action: ADIL shares closed at $1.93 on Friday.

Cannabis Investors Share 'Chips Make Chunks' Wisdom For Business Expansion At Benzinga Conference

How do you scale a cannabis business? What strategies should companies employ? These pivotal questions set the stage at the recent Benzinga Cannabis Capital Conference in Florida, where industry leaders gathered to share their insights amid the sector's dynamic challenges.

Moderated by Barbara Webb, a tax partner at MGO, the panel featured John Levine CEO of MariMed (OTC:MRMD), Seth Yakatan, co-founder of investment firm Katan Associates and Alex Gray, co-founder and CSO of Good Day Farm.

Strategic Expansion And Capital Challenges

John Levine discussed MariMed’s targeted growth strategy, emphasizing the importance of strategic expansion through vertical integration across several states, in addition to the active pursuit of mergers and acquisitions.

"Our focus is to continue our strategic plan of expanding in each of the states that we're in till we're fully vertical in each of those states, maxing out the number of licenses in each of them," Levine said.

This ambitious expansion strategy is critical in a competitive landscape where scale can significantly impact market presence and operational efficiencies.

The conversation turned toward the hurdles of raising capital in a sector that, despite its growth, remains financially intricate due to regulatory constraints.

Focusing On Core Strengths

Seth Yakatan offered a contrasting perspective, emphasizing the significance of concentrating on a few core areas that promise substantial cash flow rather than diluting efforts across too broad an array.

Yakatan’s advice to businesses is about mastering select areas of operation, "For me, scale is figuring out the 1 or 2 things as a company that you do well that generates cash flow for you…the mistake is people have tried to do 7 or 8 things at the same time and grow on a massive scale."

This strategy marks a shift from previous industry tendencies towards rapid, broad-scale expansion.

By focusing on core strengths, businesses can avoid the inefficiencies and diluted efforts that often accompany overextension. Yakatan's insights highlighted a more sustainable path to growth in the cannabis industry, where a focused approach can lead to better profitability and long-term success.

Efficiency And Cost Reduction

Alex Gray spoke on behalf of Good Day Farm, emphasizing scaling earnings through efficiency and cost-cutting measures across the business.

The approach of "chips make chunks" involves scrutinizing all aspects of operations to improve margins and operational efficiency, which is crucial for sustainable growth.

Supply Chain And Market Adaptation

The panelists agreed that scaling in the cannabis industry faces unique challenges, notably supply chain complexities and market-specific regulations.

The necessity of adapting product offerings and packaging to comply with diverse state regulations underscores the intricacies of scaling in this sector.

The discussion also highlighted the variance in scaling strategies between larger companies and small to medium enterprises (SMEs).

While larger entities might focus on strategic acquisitions and extensive capital investments, SMEs often prioritize operational efficiencies and niche market penetration to grow.

Investor Perspectives

Changing investor attitudes towards scaling in the cannabis industry were discussed, with a notable shift towards valuing sustainable growth and operational efficiency over rapid expansion.

The conversation underscored the importance of cash flow, strategic capital allocation, and the adaptability of business models to the unique demands of the cannabis market.

Photo: AI-Generated Image. 

Hemp Space Grew 3X The Rate Of Cannabis, Where Did Marijuana Get It Wrong?

Hemp is federally legal and cannabis is not. Is that the only difference between these related plants and the two markets they create? What should investors know about each market before jumping in? 

A serious conversation led by industry experts Bret Worley, CEO of MC Nutraceuticals; Norman Birenbaum, Senior Public Health Advisor at the Food and Drug Administration (FDA); Pamela Epstein, chief legal & regulatory officer at Terpene Belt Farms and Keith Bushfield president & CEO of Rexis Biotech. These professionals shared their expertise and advice at the recent Benzinga Cannabis Capital Conference in Florida on a panel moderated by Justin Swanson, partner at Bose McKinney and Evans. 

It’s been more than five years since Donald Trump signed the 2018 Farm Bill, which effectively legalized hemp and hemp-derived products. Under the bill, hemp is considered to have 0.3% delta 9 THC. This, however, left many questions unanswered and numerous products without proper regulation. One often-asked question has been whether products derived from hemp are food or supplements.

The new Farm Bill was up for renewal in 2023 but failed to meet the deadline. As a result, the House extended the 2018 Farm Bill through Sept. 30, 2024.

While the industry eagerly awaits the new Farm Bill, Birenabum said not to expect too much. ” Whether things fall in or outside of the definition of hemp, there’s a huge market that is there right now. It’s going to be very, very difficult to take a prohibitionist approach, to get all that toothpaste back in the tube.”

Birenbaum cautioned that changes to the Farm Bill “will not provide a comprehensive regulatory structure or the type of regulatory certainty that’s needed.” 

Epstein followed up. “It is more difficult to be a multi-state hemp cannabinoid producer than a multi-state cannabis operator because you have more certainty within the packaging, labeling and advertising restrictions,” she said referring to the lack of clear regulations across the hemp space. She added that investors and raw producers are interested in long-term sustainability, which is achieved through understanding the safety data and the toxicology behind new products. 

Integrity As The Basis 

Worley asked a pertinent question. “Where did marijuana get it wrong and where did hemp get it right?” Alluding to the fact that hemp space has grown three to four times the rate of marijuana. He asked the panelists what they thought was the correct regulatory framework.

Epstein explained that hemp registration is much easier than seeking a license that burdens applicants with thousands, if not millions of dollars worth of debt before ever earning a penny. Regarding an appropriate framework, hemp operators need to be responsible stewards to unlock the scheduling, she said. “Don’t be afraid of the word intoxicated. We are all selling intoxicants. Alcohol is an intoxicant. It’s not a scary word. It’s an honest integrity.” 

Bushfield added that there’s going to be “bad actors in every industry, doesn’t matter who it is,” which is why we need proper regulations.

“Our compliance department attitude is – let’s have every single warning we possibly can put on those cans, and we put it out there even if we don’t need it, even if we’re not required. So I think that has to happen across the board.

“So, if we all get together, put the right framework in place, the hemp is going to help the cannabis, the cannabis will help the hemp,” Bushfield concluded. 

The panelists agreed on the importance of education and the fact that prohibition is not helping consumer safety or consumer health.

Photo by Jean Laurenceau

How To Max Profits This 4/20, Smart Discounts Amid Sales Spike Of Premium Marijuana

In an exclusive interview with Benzinga Cannabis, Brendan Mitchel-Chesebro, of BDSA, the leading market firm specializing in global cannabis markets, shared insights into the trends, preferences and strategic moves retailers can make to capitalize on the 4/20 cannabis consumption spike.

Predicting The 4/20 Surge

Retailers looking to harness the annual 4/20 sales boom should closely observe historical sales data. Mitchel-Chesebro pointed out that in 2023, sales on April 20th soared to 137% above the monthly daily sales average.

With 4/20 falling on a Saturday in 2024, a day historically known for high sales volume, retailers are advised to prepare for a similarly significant uptick.

Consumer interest has notably shifted towards solventless extracts and culinary edibles. "Solventless products, in particular, have grown their share of total extract sales by 75% from Q1 2021 to Q1 2024, now making up 17% of total extract sales," Mitchel-Chesebro highlighted.

This growth is attributed to a combination of quality preference and the narrowing price gap, making these premium products more accessible.

“While there are likely several trends driving the growth of the solventless subcategory, one likely driver is pricing dynamics. Solventless products (particularly rosin) are often priced higher than the total extract category, with BDSA data showing that solventless products were priced 27% higher than the total extract category,” Mitchel-Chesebro said.

“With the significant price compression, we’ve seen over the past two years, solventless products are no longer as price prohibitive as they used to be, and now are accessible to both consumers who prefer quality, and consumers who prioritize low price when choosing their cannabis.”

Effective Discounting Strategies

Mitchel-Chesebro underscored the importance of strategic discounting in categories expected to see holiday boosts, like solventless products and culinary edibles.

Cross-promotion, particularly involving products commonly bought together such as sublingual, edible, and topical products, has proven to boost sales volumes significantly.

“Retailers can successfully boost sales through cross-promotion. For example, basket analytics show that sublingual buyers are more likely to purchase edible and topical products in the same transaction than buyers purchasing other form factors,” Mitchel-Chesebro said. “By offering a promotion on edible and topical products when consumers buy a sublingual, retailers can boost volume at retail and make the most of the holiday.”

Tailoring Discounts To Local Markets

When asked about aligning discount strategies with local trends, the analyst recommended leveraging cross-promotion based on basket analytics to increase basket sizes. "By promoting products typically purchased together, retailers can maximize the holiday traffic," Mitchel-Chesebro concluded, emphasizing the use of cross-promotion as a key tool for the holiday. Through careful analysis and strategic planning based on historical data and current trends, retailers can optimize their offerings for the 420 holidays, catering to consumer preferences while enhancing profitability.

Photo: AI-Generated Image. 

It's 4/20, Do You Know Where Your Parents Are?

As you may have heard, cannabis consumption among older folks is on the rise. More specifically, seniors are one of the fastest-growing groups of cannabis users in the U.S.

As it turns out, many older adults have been consuming weed for decades and new ones are joining in on the fun. Cannabis consumption among our parents and grandparents has quadrupled in the past eight years.

Study after study suggests that older adults are using cannabis to remedy an array of conditions such as sleep issues, pain, inflammation and to activate their appetites.

But most consume because they still enjoy getting high.

“Sure, I sleep better with cannabis and topical creams alleviate my knee pain, but that’s all new. I’ve been smoking pot for the past four decades and I see no reason to stop getting high,” said Cynthia P who recently retired as an ER nurse in Ohio where recreational marijuana became legal last November.

Scientists and researchers are wisely becoming interested in this Baby Boomer demographic of 77 million, many of whom are healthy, economically stable and have no plans of checking out anytime soon, so they say.

One particular study, that examined marijuana use in adults aged 60 to 88 found that whole-plant cannabis did not harm cognition but rather the opposite. Older cannabis users, relative to non-users, had significantly greater neuronal communication between the cerebellum and hippocampus.

Why? Age-related changes in the endocannabinoid system (ECS) include a decrease in the number of cannabinoid receptors throughout the brain. The ECS, a significant aspect of our human physiology that helps maintain homeostasis, is a complex cell-signaling system in the brain and body that interacts with just about all of our other body systems. 

Which means? During normal aging, the decline in cannabinoid receptors correlates with increased levels of inflammation in these brain regions causing a loss of neurons in the hippocampus, which is critical for learning and memory. This, in short, explains age-related memory impairment.  

“Oh, I believe that,” Cynthia told Benzinga. “While I never consumed for a full shift before going to work, I’m convinced that marijuana has helped keep me and my mind sharp as I aged. I’m not saying it’s for everyone, but for people of my generation there’s nothing better.”

Now Read: Hemp Space Grew 3X The Rate Of Cannabis, Where Did Marijuana Get It Wrong?

Photo: Shutterstock

Benzinga's 'Stock Whisper' Index: 5 Stocks Investors Secretly Monitor But Don't Talk About Yet

Each week, Benzinga’s Stock Whisper Index uses a combination of proprietary data and pattern recognition to showcase five stocks just under the surface and warrant attention.

Investors are constantly on the hunt for undervalued, under-followed and emerging stocks. With countless methods available to retail traders, the challenge often lies in sifting through the abundance to uncover new information.

This index layers editorial commentary to help make sense of why these stocks should be of interest and whether investors or casual readers should watch them.

Related Link: The ‘Mag 7 Bench’ – Josh Brown Picks The Next Magnificent 7 Stocks

Here is a look at the Benzinga Stock Whisper Index for the week of April 19:

Coinbase Global (NASDAQ:COIN): The cryptocurrency trading platform saw increased interest as the company’s shares pulled back during the trading week. The drop in share price could be related to a drop in the price of Bitcoin (CRYPTO: BTC) from all-time highs set earlier this year.

Bitcoin remains volatile ahead of the highly anticipated Bitcoin halving. High volatility for cryptocurrencies like Bitcoin can be positive for Coinbase as it increases its trading volume activity.

Oric Pharmaceuticals (NASDAQ:ORIC): The clinical stage biotechnology company saw increased interest in its shares during the week. The increased attention comes after the company announced that the first patients for its expansion cohorts of Phase 1b trial of ORIC-114 have been dosed. The expansion of ORIC-114 is targeting non-small cell lung cancer. Oric said it plans to update Phase 1b data in the first half of 2025.

SPDR Gold Trust (NYSE:GLD): It’s not every week that an ETF jumps in interest and trends on the Stock Whisper Index. The leading gold ETF saw increased interest, which comes as gold soars to new all-time highs in the month of April. A decision by the Federal Reserve to keep interest rates the same and increased geopolitical tension related to the Middle East have led to more attention to gold as a safe haven investment for traders.

G-III Apparel Group (NASDAQ:GIII): The apparel company saw shares trade lower after reporting quarterly results. Fourth-quarter sales were down 10.5% year-over-year to $764.8 million, which missed a Street consensus estimate of $817.5 million. The company owns and licenses brands that include Clavin Klein, Tommy Hilfiger, DKNY and Donna Karan. G-III guided for fiscal year 2025 sales to hit $3.2 billion, in-line with the Street estimate.

Transdigm Group (NYSE:TDG): The maker of components for aircraft and other vehicles saw increased interest over the trading week. The increased attention likely comes from new analyst notes. A Goldman Sachs analyst, who has a Buy rating, raised the price target on shares from $1,218 to $1,518.

Meanwhile, a Stifel analyst kept a Hold rating during the week, but raised the price target from $1,100 to $1,200. Shares of Transdigm trade at $1,213.50 at the time of writing. The company could also be seeing increased attention as it makes parts for military aircraft. Defense stocks have been in the spotlight with increased geopolitical tensions and calls to increase military aid for allies overseas.

Stay tuned for next week’s report, and follow Benzinga Pro for all the latest headlines and top market-moving stories here.

Read the latest Stock Whisper Index reports here:

March 22

March 29

April 12

Read Next: EXCLUSIVE: Top 10 Most Searched Tickers On Benzinga Pro In March: Where Do Tesla, Nvidia, SPY And Reddit IPO Rank?

EXCLUSIVE: Banking-Fit Means Your Cannabis Business Is At The 'Pinnacle Of Fitness,' Experts Explain At Benzinga Conference

Cannabis is a “competitive industry,” and those looking to build their business should “embrace it,” says Kevin Hart, founder and CEO of Green Check Verified, a leader in banking solutions for the cannabis industry.

To get the much-needed capital, all you need to do is not be afraid of the competitive environment, Hart told those gathered at the Benzinga Cannabis Capital Conference in Florida on Tuesday.

“There’s access to financial and business services at your fingertips,” Hart said, adding, “You just have to be prepared to share some information.”

For Adam Stettner, founder and CEO of FundCanna, “that information is how the money will be used.” Stetter joined Hart and two other industry experts, Ryan Himmel, VP and head of strategic partnerships at LeafLink and Sahar Ayinehsazian, a partner in Vicente LLP‘s Los Angeles office. The panel was moderated by Jeanne M. Sullivan, chief investment officer at Arcview Ventures.

The panelist discussed the complexities of banking for cannabis businesses, outlining best practices for financial fitness and strategies for achieving banking access.

As the head of the company that provides access to flexible capital for the cannabis industry, Stettner is most interested in how the “money will be applied and what the repayment terms look like,’ while thinking about”what the loopholes are,” in terms of the borrows financial fitness and strength.

What Does Being Fit Mean?

When assessing if someone is fit as a borrower, the main parameter is cash flow, he said.

See also: New Financing Solutions Change The Game For The Cannabis Industry

“It’s very hard to determine how you qualify for repayment and how that repayment will impact your business if you don’t have a baseline of revenue from which to calculate,” Stettner explained.

Vicente LLP’s Ayinehsazian said being fit for banking means your business is at the “pinnacle of fitness.”

Why? That’s due to banking being closely related to the many different aspects of a business, including being compliant with operations, running smoothly with corporate records being in order, she explained.

“You’re also fit for a surprise visit from a regulator, you’re also fit for a potential investor or a potential lender to come in and take a look at you,” Ayinehsazian noted.

Know What You Are Dealing With

She also emphasized cannabis operators need to understand the price paid for capital and the potential ‘ripple effects’ that come with it.

“There’s no such thing as a free lunch,” Ayinehsazian said. “So if you are able to access capital, but it seems a little bit too good to be true, it probably is a little bit too good to be true.”

LeafLink’s Himmel, representing the industry’s wholesale platform that focuses on cannabis businesses being more fit as it relates to banking, has a similar opinion.

One of the most important aspects of any company’s financial fitness is knowing how to rationalize tools at its disposal and making data-driven decisions, he said.

Cannabis businesses need to “have the ability to manage inventory,” to avoid “causing bad unhealthy behavior such as channel stuffing in the market.”

“We cannot be in a situation in a year from now, where we still have states where there’s three years worth of inventory at the wholesale level,” Himmel continued.

Instead, he is proposing more consolidation and providing cannabis operators with more value in a single unified experience to help them be “better fit to get banking services.”

After all, cannabis operators don’t want to be burdened with regulations on the financial side of their businesses, as Green Check’s Hart noted.

To address that, Green Check is working on providing availability and creating that “frictionless environment so you don’t injure yourself and you know have problems of having to go out and get new bank accounts and everything.”

Now read: Cannabis Banking Reform ‘Closer Than Ever,’ D.C. Insiders Tell Benzinga Conference: Cannabis ETF On The Move Tuesday

Photo by Jean Laurenceau