Thursday , 9 July 2020


Cannabis Central: The Mysterious Makeup Of the Pot Stock Sector Unmasked

Automatically receive the internet’s most informative articles bi-weekly via our free bi-weekly Market Intelligence Report newsletter (sample here). Register in the top right hand corner of this page.

When analyzing the cannabis stock sector it is important to know which companies are doing business within each of the industry’s 11 categories so one can make a meaningful comparison of percentage changes in price performances with their peers. This article demystifies the makeup of the fledgling pot stock market.

By Lorimer Wilson, editor of munKNEE.com – Your KEY To Making Money!

298 cannabis companies have securities that actively trade on the various stock exchanges in Canada and the United States within 11 categories (see below) based on their primary area of focus in the cannabis industry.

Only 39 (13%) of the above mentioned 298 stocks trade for US$1/share or more and they have been identified, by category, as follows:

  1. Cultivation & Retail Category: A total of 96 companies (representing 32% of the total):
    • The category consists of companies that grow and sell cannabis flower and related products.
    • The key companies are:
      1. Acreage Holdings Inc. (ACRGF)
      2. Alcanna Inc. (LQSIF)
      3. Aphria Inc. (APHA)
      4. Aurora Cannabis Inc. (ACB)
      5. Canopy Growth Corporation (CGC)
      6. Columbia Care Inc. (CCHWF)
      7. Cronos Group Inc. (CRON)
      8. Curaleaf Holdings Inc. (CURLF)
      9. FSD Pharma Inc. (HUGE)
      10. Green Thumb Industries Inc. (GTBIF)
      11. Harvest Health & Recreation Inc. (HRVSF)
      12. MediPharm Labs Corp. (MEDIF)
      13. Organigram Holdings Inc. (OGI)
      14. Planet 13 Holdings Inc. (PLNHF)
      15. Rubicon Organics Inc. (ROMJF)
      16. TerrAscend Corp. (TRSSF)
      17. Tilray Inc. (TLRY)
      18. Trulieve Cannabis Corp. (TCNNF)
      19. Valens GroWorks Corp. (VLNCF)
  2. Biotechnology Category: 32 companies in total (11%)
    • The category consists of pharmaceutical companies focused on R&D of new drugs and products utilizing cannabinoids.
    • The key companies are:
      1. GW Pharmaceuticals Plc (GWPH)
      2. Cara Therapeutics Inc. (CARA)
      3. Corbus Pharmaceuticals Holdings Inc. (CRBP)
      4. Zynerba Pharmaceuticals Inc. (ZYNE)
      5. Abacus Health Products Inc. (ABAHF)
      6. Avicanna Inc. (AVCNF)
      7. XPhyto Therapeutics Corp. (XPHYF)
  3. Marijuana-Infused Products Category: 26 companies in total (9%)
    • The category consists of companies focused on developing and selling marijuana-infused products and companies focused on the extraction of cannabis compounds and their infusion into consumer products.
    • The key companies are:
      1. Cresco Labs Inc. (CRLBF)
      2. Neptune Wellness Solutions Inc. (NEPT)
      3. New Age Beverages Corporation (NBEV)
  4. Consumption Devices Category: 10 companies in total (3%)
    • The category consists of companies focused on developing and selling personal consumption devices for cannabis consumers such as vape pens and inhalers.
    • The key companies are:
      1. AYR Strategies Inc. (AYRSF)
      2. Greenlane Holdings Inc. (GNLN)
      3. Pyxus International Inc. (PYX)
  5. Agricultural Technology Category: 16 companies in total (5%)
    • The category consists of companies focused on providing automated growing systems, greenhouses, farming products, nutrients, hydroponics, fertilization systems, horticultural expertise, LED/lighting technologies, air filtration systems, and climate control and energy efficiency systems.
    • The key companies are:
      1. Village Farms International Inc. (VFF)
      2. GrowGeneration Corp. (GRWG)
  6. Real Estate Category: 9 companies in total (3%)
    • The category consists of investment companies and REITs that develop, own, and/or lease commercial real estate properties to licensed cannabis operators.
    • The only stock that trades at least US$1/share is:
      1. Innovative Industrial Properties Inc. (IIPR)
  7. Business Services/Consulting Category: 30 companies in total (10%)
    • The category consists of companies that provide professional services such as branding, packaging, bottling, compliance, physical security, transportation, lab testing, distribution, and insurance. consulting and other business services directly to marijuana cultivators and retailers.
    • The only stock that trades at least US$1/share is:
      1. Medicine Man Technologies Inc. (SHWZ)
  8. Tech & Media Category: 18 companies in total (6%)
    • The category covers companies that provide delivery services, enterprise software, e-commerce platforms, communication and mapping services, and trading platforms and companies that provide marijuana-related media including news, content, social networks, games, and entertainment.
    • The only stock that trades at least US$1/share is:
      1. Akerna Corp. (KERN)
  9. Hemp Products Category: 30 companies in total (10%)
    • The category consists of companies that produce and sell hemp products.
    • The key companies are:
      1. cbdMD Inc. (YCBD)
      2. Charlotte’s Web Holdings Inc. (CWBHF)
  10. Investing & Media Category: 23 companies in total (8%)
    • The category consists primarily of companies which own and/or manage a portfolio of cannabis assets and financial service providers that offer capital and financing solutions for companies in the cannabis industry.
    • no stocks in this category trade at US$1/share or more
  11. Other Ancillary Sector: 8 companies in total (3%)
    • The sector consists of companies that provide products and services related to the broader cannabis economy that do not fit within the other sectors such as companies focused on developing breathalyzers and testing kits for marijuana consumers and organizations, cannabis vending machine manufacturers and cannabis medical clinics, hospitality and tourism companies.
    • no stocks in this category trade at US$1/share or more

The 39 highlighted stocks above trade for US$1/share or more and, as such, are included in a new Non-penny Pot Stock Index (NPSI) that tracks their daily performance. Further details regarding the new Index are as follows:

  • 2 trade above US$20/share,
  • 5 trade between US$10 and US$20/share,
  • 7 trade between US$5 and US$10/share and
  • 25 trade between US$1 and US$5/share. The official definition of a “penny” stock is one that trades below US$5/share but, when it comes to pot stocks, that is where 88% of the total universe trade, so the more literal definition of stocks that trade for less than US$1/share is used.

In addition, the market capitalization makeup of the NPSI, calculated by multiplying the number of a company’s shares outstanding by its stock price per share, is as follows:

  • Large-Cap (+US$10B): 0
  • Mid-Cap (US$2B to US$10B): 3
  • Small-Cap (US$300M to US$2B): 13
  • Micro-Cap (US$50M to US$300M): 19
  • Nano-Cap (Less than US$50M): 4

To see how the new Non-penny Pot Stock Index (NPSI) has done on a daily basis over the last few months, visit my daily updates here.

Scroll to very bottom of page & add your comments on this article. We want to share what you have to say!

 munKNEE.com has joined eResearch.com to provide you with individual company research articles and specific stock recommendations in addition to munKNEE’s more general informative articles on the economy, the markets, and gold, silver and cannabis investing.
Check out eResearch. If you like what you see then…

Leave a Reply

Your email address will not be published. Required fields are marked *