Pot Stocks, ETFs, Top News And Data From The Cannabis Industry This Week
We saw several big announcements related to cannabis this week. On the policy front, the European Parliament passed a resolution recommending nations in the European Union revise their laws around medical marijuana to better support research and patient access. Joaquin Rodriguez of GenX Biosciences and Arnaud Dumas de Rauly of The Blinc Group explained what this means.
In domestic news, Members of the House Financial Services Subcommittee on Financial Institutions and Consumer Protection heard testimony Wednesday from several representatives in support of legislation that would make it easier for banks to work with legal cannabis businesses without fear of federal prosecution. The committee discussed a draft of the Secure and Fair Enforcement (SAFE) Banking Act, which is expected to be introduced in the House of Representatives this month.
“This week's hearing by Congress on cannabis banking shows that newly elected politicians are willing to make some progress with regards to legislation,” Debra Borchardt, CEO of Green Market Report, told Benzinga. “The hearing mostly consisted of pro-legalization witnesses so that does bode well for some action this year. It also came on the heels of Colorado reporting that marijuana revenue in 2018 topped $266.5 million versus over $247 million in 2017. The state said that to date, marijuana tax, license and fee revenue totals over $927 million since adult-use marijuana sales began on January 1, 2014. So clearly something must be done.”
Read more about the banking hearings and what the National Cannabis Industry Association has to say about it here.
Marijuana Stocks & ETFs
Over the last five trading days, the Horizons Marijuana Life Sciences Index ETF (OTC:HMLSF) (TSE:HMMJ) gained 3.3 percent, while the ETFMG Alternative Harvest ETF (NYSE:MJ) rose roughly 3.5 percent. The SPDR S&P 500 ETF Trust (NYSE:SPY) closed the period up about 2.4 percent.
Here are some of the top marijuana stocks (market cap above $400 million) in U.S. exchanges and how the performed over the last five trading days:
• Acreage Holdings (OTC:ACRZF): down 7 percent
• Aphria Inc (NYSE:APHA): up 1.4 percent
• Aurora Cannabis Inc (NYSE:ACB): down 7 percent
• CannTrust Holdings Inc (OTC:CNTTF): up 8.9 percent
• Canopy Growth Corp (NYSE:CGC): up 4.6 percent
• Cronos Group Inc. (NASDAQ:CRON): up 9.2 percent
• Curaleaf Holdings Inc (OTC:CURLF): down 1.2 percent
• Green Growth Brands Inc (OTC:GGBXF): down 1.5 percent
• Green Organic Dutchman Holdings Ltd (OTC:TGODF): up 11.4 percent
• Green Thumb Industries Inc (OTC:GTBIF): up 11 percent
• GW Pharmaceuticals PLC- ADR (NASDAQ:GWPH): up 2.4 percent
• Hexo Corp (NYSE:HEXO): up 4.5 percent
• iAnthus Capital Holdings Inc (OTC:ITHUF): down 3.1 percent
• Marimed Inc (OTC:MRMD): down 2.5 percent
• MedMen Enterprises Inc. (OTC:MMNFF): down 6.3 percent
• OrganiGram Holdings Inc (OTC:OGRMF): up 14.4 percent
• Scotts Miracle-Gro Co (NYSE:SMG): up 4.6 percent
• Tilray Inc (NASDAQ:TLRY): down 3.4 percent
In Other News
On the markets front, California's best-selling cannabis flower brand, Flow Kana, raised $125 million, completing the largest private funding round of a U.S. cannabis company to date. The first-of-its-kind company doesn't cultivate cannabis but rather acts as a conduit for small, decentralized and sustainably-operated cannabis farms.
“The vision for a sungrown, sustainable and regenerative cannabis movement is not a niche market for politically correct consumers. It’s a systematic transformation of our global food and medicine production system that can cool the planet as we heal the world,” Flow Kana CEO Michael Steinmetz told Benzinga.
Aurora Cannabis reported results for the second quarter of fiscal 2019, posting gross revenue growth of 109 percent sequentially to $62 million. The gross revenue surged by over 430 percent compared to the same quarter of fiscal 2018 and was lower than the consensus analyst estimate of $67 million.
Meanwhile, Canopy Growth reported fiscal third-quarter results, with revenue up 283 percent year-over-year.
Wurk, a human capital management company for the cannabis industry, secured $11 million in a funding round. The company plans to use the capital on its expansion strategy. More about this story here.
Web-based data technology platform CannaRegs completed a $2 million raise to expand beyond cannabis.
Cannabis dispensary operator Medmen Enterprises is being pushed out a New York medical marijuana trade group amid allegations made by the company's former CFO in a lawsuit against the company.
Benzinga learned Cannabidiol (CBD) products are now included in the Prescribers' Digital Reference — formerly known as the Physicians' Desk Reference — for the first time ever. The companies are HempMeds and Kannaway, two subsidiaries of Medical Marijuana Inc (OTC:MJNA).
Barneys New York and luxury cannabis company Beboe, recently acquired by Green Thumb Industries, partnered up to sell cannabis lifestyle products at select Barney’s locations. Read all about the upcoming The High End stores here.
The cannabis industry reached another investment milestone when Standards & Poors announced Thursday it will add the cannabis REIT Innovative Industrial Properties (NYSE:IIPR) to its 600 SmallCap Index next week.
TILT Holdings (OTC:SVVTF) announced preliminary and unaudited pro forma January 2019 gross revenue of $18.3 million. Over 2018, the company reported pro forma annual gross revenue of $97.3 million. These recent financial results establish TILT as one of the top U.S. revenue producing publicly traded cannabis companies. Pro forma January revenue was driven by continued growth of all companies within TILT, including recent acquisitions. January numbers do not reflect the opening of any recreational stores, which are expected to come online throughout 2019.
“These early results reflect positively on the opportunity TILT has to benefit from the integration of several market leading, but formerly independent businesses,” said Alex Coleman, CEO of TILT Holdings. “The dynamic companies we have acquired position us to offer the broadest range and highest quality products and services to support cannabis businesses on a global scale. More specifically, we can offer customized cannabis products and devices through Jupiter, deliver them through the Blackbird route-to-market, and have our retail customers connect to consumers through Baker. TILT has a very unique and significant opportunity to drive growth and shareholder value by continuing to invest in improving our product offerings and geographic reach.”
Green Growth Brands announced a deal with Simon Property Group Inc (NYSE:SPG), the largest mall operator in the U.S., to launch a chain of CBD shops across malls operated by the latter. Peter Horvath, CEO of Green Growth Brands told Benzing the deal allows "us to offer high quality and affordably priced CBD-infused personal care and beauty products in some of the best malls. It’s a strategic partnership that gives us access to new consumers across the country while creating a more dynamic and diverse shopping experience at Simon Malls locations.”
FLRish, Inc., the parent company of California cannabis retail brand Harborside, announced it has entered into a definitive merger agreement with Lineage Grow Company. Once approved by the Canadian Securities Exchange (CSE), Lineage will change its name to Harborside Inc., and trade under the stock symbol HBOR.
“This is a major milestone on the road to transitioning the United States’ most iconic dispensary into a major player in the public markets. After carefully considering multiple strategic options, we concluded that a reverse take-over of Lineage would be the strongest capital markets vehicle, in part due to the cannabis assets that it brings to the table, including a California cultivation facility and dispensaries in California and Oregon,” Andrew Berman, CEO of FLRish and Harborside told Benzinga.
Nanette Heide is a partner and co-chair of the private equity group at Duane Morris LLP, which represented Harborside in the deal. Commenting on the deal, she said, “Investors are eager to put their capital to work in the legal cannabis market because they see a huge opportunity… In 2018, legal cannabis in the United States was a $10.4 billion industry … Marijuana is still regulated as a controlled substance at the federal level, which has caused some traditional investors and lenders to be wary of opening their spigots for this market. Lacking access to more traditional sources of capital is driving cannabis companies to find innovative ways to tap the capital markets, such as reverse mergers with public companies in Canada where cannabis is legal.”
Driven Deliveries Inc. (OTC:DRVD) expanded its California cannabis delivery platform. Driven Deliveries has established relationships with four cannabis retailers located throughout California's largest markets. This will ultimately allow Driven to support deliveries in the Bay Area, Central California, Sacramento, the OC, and Los Angeles areas.
MChris Boudreau, CEO of Driven Deliveries, told Benzinga, "This is an exciting time for our company as we continue to grow at an exponential rate. As we plan to advance through California and to surrounding states, Driven Deliveries will maintain the highest service to our customer while adding numerous partnerships along the way."
Biome Grow Inc (OTC:BIOIF) announced an agreement to access high quality hemp-derived CBD concentrate from CBD Acres. The initial term is for a period of five years, during which Biome may acquire up to 20,000kg of concentrate (equivalent to over 150,000 kg of dried flower) per year. Biome noted hemp-based CBD having no THC allows them to tap into new international markets more easily as they bring medical cannabis programs online. Additionally, they plan to bring the cost of CBD down to a significantly lower rate than the current market, due to proprietary technology and outdoor Hemp grow not being regulated by the cannabis act.
“We can generate over $200m in revenue with this supply agreement, which is substantially better margins than if we built our own production facilities. However, we avoid the CAPEX spend and complexity of running a highly regulated Cannabis Act facility. This is the very definition of a more efficient cannabis company,” said Khurram Malik, CEO of Biome Grow.
Acreage Holdings’ New York affiliate, NYCANNA, is opening first metro-New York City location, The Botanist, on Feb. 20. In keeping with the store’s mission to enable access to cannabis for every registered patient or caregiver who needs it, all veterans who purchase product or merchandise at The Botanist will receive a 10 percent discount through the end of March.
“When NYCANNA applied for a medical marijuana license in New York, we chose locations, including Queens, that we anticipated would be particularly under-served,” a spokesperson for NYCANNA told Benzinga.
MassRoots Inc. (OTC:MSRT) announced it has entered into a definitive agreement to acquire COWA Science Corporation, a supply-chain as a service company. The common-stock consideration has been valued at approximately $5.78 million, and is dependent on COWA Science achieving certain annual revenue milestones.
Isaac Dietrich, CEO of MassRoots, told Benzinga, “We've been laser-focused on growing MassRoots' revenues and we believe the acquisition of COWA, which generated north of $1.5 million in revenue last year, will be a significant driver of those efforts. This deal expands our product offerings at every step of the cannabis supply chain — from cultivators to dispensaries to consumers.”
Village Farms International Inc (OTC:VFFIF) announced the approval of its request to list on the Nasdaq under they symbol “VFF.” The vertically integrated greenhouse grower “is now leveraging its 30 years of experience as a vertically integrated grower for the rapidly emerging global cannabis opportunity through its 50% ownership of British Columbia-based Pure Sunfarms Corp., one of the single largest cannabis growing operations in the world. The Company also intends to pursue opportunities to become a vertically integrated leader in the U.S. hemp and CBD markets, subject to compliance with all applicable U.S. federal and state laws,” a press release said.
Weekend Unlimited (OTC:WKULF) announced the appointments of Karl Schmieder to the role of Director of Business Development, and Tom Wisniewski as Vice President of Sales Operations. Their dispensary brand, Northern Lights Supply in Nisku, Alberta received its initial shipment from AGLC, allowing it to set a grand opening date for Feb. 23, with approximately $200,000 worth of inventory. The firm closed the week by entering into a definitive agreement with R&D Pharma in Jamaica, which is anticipated to close next week.
“Upon signing this deal, we are excited to accelerate operations in Jamaica. There has been tremendous work accomplished on the property by the team on the ground and the cultivation results have been impressive in both quality and economically,” noted Mr. Paul Chu, Weekend Unlimited President and CEO.
Harvest Health & Recreation Inc. (OTC:HRVSF) announced it will acquire Falcon International Corp., a California cannabis company, for a “non-material undisclosed amount of stock.” Harvest will use Falcon as the backbone of its California operations and foundation for national brand distribution, the company explained.
“At Harvest we're focusing more on brands as we see them as a pivotal part of the future of cannabis. Falcon has done a great job of manufacturing in a very competitive market and we are thrilled to bring their products to more than a dozen states around the country,” Harvest’s Executive Chairman Jason Vedadi told Benzinga.
Pennsylvania cannabis cultivation and dispensary company Ilera Healthcare tapped Dr. Oludare Odumosu as Chief Scientific Officer and EVP of its Pharmaceutical Division. He will be in charge of driving research, development and implementation of Ilera’s proprietary “pharmaceutical-grade” medicines and therapeutic platforms to the global marketplace. Odumosu brings 10 years of experience in corporate pharmaceutical business development, operations and strategic alliance management to his new role.
In addition, Tom Borger will be joining the the company as the new Chief Operating Officer, with a focus on building a world class marketing and retail operation. Borger brings a blend of marketing, technology and general management experience and has worked extensively in both start-up and large companies, including Johnson & Johnson (NYSE:JNJ) and GlaxoSmithKline plc (NYSE:GSK).
Sen. Brian Schatz (D-HI) and Rep. Barbara Lee (D-CA) introduced a bicameral veterans-focused medical cannabis bill, that seeks to “expand and facilitate medical cannabis access to military veterans suffering from chronic pain, PTSD, and other serious medical conditions.”
A new seed-to-sale tracking system for legal cannabis and hemp is moving closer to commercialization as Applied DNA Sciences Inc (NASDAQ:APDN) and TheraCann International Benchmark signed a term sheet for a long-term exclusive licensing agreement. As per the agreement, TheraCann will be able to use Applied DNA’s proprietary CertainT supply chain integrity platform technology as part of its ETCH BioTrace seed-to-sale tracking system. Applied DNA will receive $5 million in non-contingent phased payments over a period of six months.
Dr. James Hayward, president and CEO of Applied DNA Sciences, said, “We believe this agreement with TheraCann will help create a market standard that will provide regulators, suppliers and customers an unprecedented level of security and certainty for legal cannabis, derivative products and hemp. With the growth of the global legal cannabis market, ETCH BioTrace has the potential to play an increasingly important role in ensuring the authenticity of legal cannabis and preventing counterfeits from entering the regulated supply chain.”
Stratos CBD launched what they claim is “the world’s first and only full spectrum hemp oil and CBD isolate from hemp oil tablets.” The tablets are created with pharmaceutical ingredients and Colorado-grown hemp oil, they explained.
“It is important that customers can buy a CBD or full spectrum hemp oil product and trust that the product is exactly as the label reads,” said Kate Heckman, VP of Branding and Marketing at Stratos CBD. “We are proud to introduce a trustworthy product and to offer anyone a Certificate of Analysis so they know exactly what they are getting. Our tablets offer a discrete, sugar-free, gluten-free and vegan choice for those looking to supplement their health regimen with CBD and hemp option.”
Entrée Capital, a venture capital firm that funds multi-stage startups and companies, announced it's actively seeking investments in companies from the cannabis sector. The firm has selected Israel-focused cannabis innovation hub Can Innovation Finder (CIF) to be its advisor on the industry.
CIF’s co-founder Yona Cymerman said, “There are incredible partnership opportunities for companies on both sides, and Cannabis-focused VCs can gain a huge market advantage by tapping into Israel’s tech ecosystem. Our role is to highlight opportunities that the market may not know about and provide the platform to enable new partnerships and business ventures. With contracts in place with LPs and VCs to introduce them to multiple Israeli companies, we save them time and ensure they have access to top Israeli CannaTech, AgriTech and BioTech innovation.”
CannAmerica Brands Corp (OTC:CNNXF) announced a new licensing agreement and brand partnership with Flower One, the largest cannabis cultivation greenhouse in Nevada. Flower One’s 400,000 sq foot greenhouse is capable of producing 140,000 pounds of flower is the best opportunity for CannAmerica to expand its operations in preparation for FDA regulations and federal legalization of cannabis in the U.S.
“In anticipation of the growing number of retail locations in the state of Nevada, coupled with increased consumer demand, it was vital to partner with a large-scale producer in the Silver State – and Flower One was the obvious choice,” said Dan Anglin, Founder and CEO of CannAmerica Brands. “The footprint of Flower One’s vast greenhouse facility is impressive, but perhaps even more noteworthy are the planned capabilities of their 55,000 square-foot production facility. We’re so excited about this new partnership with Flower One in Nevada; we see a long-term future with them as we continue to grow our iconic brand across America.”
Read about these and other news with out friends at Marijuana Money.
Interesting Data & Information
Online commercial real estate marketplace Ten-X Commercial released its latest “U.S. Industrial Market Outlook” report. The study shows the cannabis industry is “a key reason for increased commercial real estate growth in the West, particularly California.”
The report indicates today’s industrial market benefits from several “secular shifts that have led to an increase in demand for warehouse space including the rise of e-commerce, cloud computing and the legalization of marijuana in some states.”
Looking at factors such as employment growth, salaries in manufacturing and rent pricing for industry, the report identified the top five ‘buy’ markets for commercial real estate in the industrial sector across the U.S. – all of which are located in California, and include Los Angeles, Sacramento, San Francisco, Oakland and San Jose.
“While the industrial market is on the rise nationwide, the sector is particularly strong in California, which makes sense when considering demand drivers for warehouse space – most notably, the increase in tech developments such as cloud computing and the legalization of marijuana in certain states,” said Ten-X Chief Economist Peter Muoio. “California is home to a booming tech industry and one of the nation’s most prosperous legal marijuana markets, creating a consistent need for industrial real estate assets.”
Further analyzing the impact of marijuana legalization on the real estate market in California, Jay Morrison, former real estate broker and now CEO of Tulsa Real Estate Fund, believes the attractiveness of the California market is due to the positive momentum behind the marijuana industry, including state support and access to an existing infrastructure which allows for room to grow business and industry. Morrison thinks state laws will continue to change based on the popularity of the industry, growth trends, sustainability as a desired product and grassroots momentum.
“We will see everything from marijuana Bed and Breakfast initiatives, to land deals for standard marijuana farming opportunities, to properties or leases for companies that make or manufacture ancillary or subsidiary products, to manufacturing or storage of equipment for marijuana cultivation.”
For more interesting data, check out this story by Andrew Ward: “The Latest Trends In Cannabis Company Fundraising: Bigger Deals, New Markets Coming Online”
More From Benzinga’s Cannabis Newsdesk
Here are some other interesting cannabis-related stories from this week:
Jeff Siegel shared his first “Bulls And Bud Of The Week: Dixie Brands And James Henry.”
“How Alleged WHO Recommendations Would Affect International Cannabis Markets” and “GenCanna Exec Explains Two Advantages Of THC-Free Hemp,” by New Frontier Data’s staff.
“Why Analysts Are Excited About These Three Cannabis Stocks,” by Saul Bowden.
“4 Stats That Show How Big The Global Cannabis Market Is Becoming,” “The Home Depot Of Cannabis: How GrowGeneration Pitched Itself To A Room Of Investors,” and “KushCo, DionyMed And More Investor Presentations From The Cannabis Capital Conference,” by Spencer Israel.
“States Push To Expand Cannabis Access: Will The Market Follow?,” by Andew Ward.
“Canaccord's Takeaways From Aurora's First Full Quarterly Earnings Print,” by Jayson Derrick.
“Oregon Aims To Create An Export Market For Marijuana” and “Aurora Cannabis Ramping Up Production As Revenue Surges On Legal Pot Market,” by FreightWaves’ staff.
“Constellation Brands Made The Right Move With Early Cannabis Investment, Wells Fargo Says,” by Elizabeth Balboa.
“Survey: Despite Marijuana Legalization, Canada Sees No Change In Number Of Consumers” and “Valentine's Day Gift Ideas: Weed-Infused Products For The Marijuana Connoisseur And Canna-Curious,” by Alex Oleinic.
“The Marijuana ETF Continues To Impress; Could Institutional Interest Be Next?,” by Todd Shriber.
Check out these and other cannabis stories in our cannabis portal.
Feb. 16: Brotherly Love and Operation EVAC are having a lounge takeover at Moe Greens, in San Francisco. During the takeover, 10 percent of all proceeds will be donated to Operation EVAC.
Feb. 19: Trailblazers in the cannabis industry will come together at Accelerate Cannabis, New Jersey’s Expanding Market, an educational and networking symposium to be held at the New Jersey Performing Arts Center. Organized by the team at Longview Strategic, presentations include cannabis specialists including policy makers, strategists, entrepreneurs, scientists, attorneys and more. Organizer Ellie Siegel said that consultants, local government experts, and cannabis brand leaders will discuss how New Jersey is prepared for adult-use legislation and the expansion of the medical program.
Feb.19: Grit Capital and KCSA are hosting an Unforgettable Cannabis Tour in Florida. This tour is an opportunity for institutional portfolio managers, investment advisors and family offices to visit dispensaries of some of the top U.S. cannabis multi-state operators, participate in personal discussions with executive management, and gain insight on the rapidly growing U.S. cannabis landscape.
"We can't wait to show Florida an exclusive event done by Grit Capital & KCSA! All 3 highlighted companies have something unique to offer – our job is to create face-to-face engagement to spark a real relationship between interested investors and the companies. Our goal is to create the highest ROI for both sides, and what could be better than doing it in the Sunshine State,” said Nicole Marchand, Grit Capital’s CEO.
Feb. 23: Chanda Macias, founder of National Holistic Healing Center, and chairwoman and acting CEO of Women Grow, will be the keynote speaker at a free day-long conference aiming to help New Yorkers of color to join the ranks of those who own legal cannabis and hemp businesses. Elected officials including New York State Attorney General Tish James will join medical clinicians, grassroots community and health organizers, attorneys and cannabis/hemp entrepreneurs who are among the line-up of national, regional and local expert speakers and workshop facilitators for The Business of Cannabis, at Emmanuel Baptist Church in Brooklyn. Tickets are free.
Feb. 27 – March 1: The 5th Annual Emerald Conference will be held at Loews Coronado Bay Resort in San Diego, California. The conference brings together top scientists, extraction and cultivation professionals, and visionary business leaders in a collaborative environment that fosters groundbreaking advancements.
Feb. 27: CannaImpact and Nextage Innovation announced their first annual Cannabis Tech Pitch Night, to take place in Tel Aviv, Israel. The purpose of this Pitch Night is to ignite innovation in the medical cannabis and tech industry and to provide pioneering startups with exposure to technology leaders, investors, and potential partners, the organizers explained. The winning startup will receive a complimentary creative package to help push their venture forward, as well as mentoring from cannabis industry leaders.
March 29 – March 30: The NoCo Hemp Expo will gather hemp industry people at the Crowne Plaza DIA Convention Center in Denver. Morris Beegle, founder of NoCo Hemp Expo told Benzinga, “The sheer industry response and anticipation for this year's NoCo Hemp Expo has been off the charts. We have expanded our Business Conference and Farm Symposium programming by 50 percent, added a new Investor's Forum, and we sold out of exhibition space within 25 days of opening registration.”
April 8 – April 10: Cannabis Science Conference will host its first East Coast event at the Baltimore Convention Center in Baltimore, Maryland. The Cannabis Science Conference, organized by CSC Events, LLC, will feature television icons and cannabis advocates, Montel Williams and Ricki Lake, along with over 75 expert presenters.
April 17 – April 18: The Benzinga Cannabis Capital Conference, the premier gathering of cannabis entrepreneurs and investors in North America, returns to Toronto, Canada. Keynote speakers include Giadha Aguirre de Carcer, Cam Battley, Alan Brochstein, Jon Najarian, Danny Moses, Jeanne M. Sullivan, Tim Seymour, and many more. Find all the info you need at bzcannabis.com
May 28 – June 1: The Cons is a gathering of three trade and fan shows — the Cam Con, the Cannabis Con, and the Inked Con — all under one roof at the SLS South Beach Hotel in Miami Beach, Florida. The Cons 2019 will offer a variety of seminars with top industry panelist, networking parties and performance displays to benefit the industry’s content providers, models and affiliates. While these industries have differences, in many ways they overlap.
Photo by Javier Hasse.
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