|Bid||19.31 x 1000|
|Ask||19.37 x 800|
|Day's Range||19.22 - 20.59|
|52 Week Range||5.12 - 25.10|
|Beta (3Y Monthly)||4.28|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
A new study says marijuana is the fastest growing labor market in the U.S. Yahoo Finance's Zack Guzman & Jeanie Ahn, along with 'Afford Anything' Podcast Host Paula Pant discuss with Acreage Holdings CEO Kevin Murphy.
Cannabidiol (CBD) is emerging as a red-hot category of the marijuana industry. CBD includes compounds in the cannabis sativa plant that do not produce a high. In fact, over the years, CBDs have been shown to have powerful therapeutic effects.Now it looks like the U.S. market could open up in a big way for this type of cannabis and several CBD stocks are gaining traction. The reason: In December, Congress passed the 2018 Farm Bill, which declared that CBD would no longer be treated as an illegal substance.So how big could this opportunity be? Well, according to research from the Brightfield Group, the market in the U.S. could hit $22 billion by 2022.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * The 10 Best ETFs to Buy in the Second Quarter No doubt, this could move the needle for marijuana stocks -- and here's a look at seven that stand out: Cronos Group (CRON)Cronos Group (NYSE:CRON) operates a vertically integrated cannabis platform, with a presence across five continents. In terms of the CBD opportunity, the company recently struck a strategic partnership with Gingko Bioworks, which has raised $430 million. The company's founder, Tom Knight, is known as the "father of synthetic biology" and his innovations -- such as with software to print DNA -- should allow for the creation of cannabinoids at a massive scale. This is critical because it can be difficult to produce pure forms that are cost-effective and precise.CRON also has the advantage of substantial financial resources to commercialize its cannabinoids. Last December, Altria (NYSE:MO) invested $1.8 billion into the company for a 45% stake. The deal is certainly a validation of CRON but it will also allow for much broader distribution and improved product development.Of course, a company like MO does engage in substantial due diligence before making an investment. In the latest earnings call, CEO Howard Willard said: "We believe the growth opportunities are significant and will extend across the globe as cannabis markets open. Selecting the right partner in this category was critical and we've done just that. Cronos strong management team has built unique capabilities to compete globally across the medicinal, recreational and nutraceutical categories." Aurora Cannabis (ACB)Aurora Cannabis (NYSE:ACB), a Canadian based cannabis producer, has been building up its CBD business. Part of this has been with its investments in industrial hemp production, such as with the Radient facility in Edmonton. It is expected to get as much as 10,000 kilos per day.Next, ACB has been focused on revving up its product offerings. According to the latest earnings call, Chief Corporate Officer Cam Battley, the company is poised "to launch a broad line of CBD based wellness product in the near future."What's more, ACB has been aggressive with its dealmaking. For example, it has increased its equity position in Hempco and purchased Agropro, which is Europe's largest hemp producer. * 10 Stocks on the Rise Heading Into the Second Quarter Something else to keep in mind: Legendary billionaire investor Nelson Peltz has joined the company as an advisor. This is certainly a major vote of confidence. He not only has deep access to investment capital but a strong network of potential partners, especially in the consumer goods industry. Some of his investments include stakes in PepsiCo (NASDAQ:PEP), Procter & Gamble (NYSE:PG) and Mondelez (NASDAQ:MDLZ). Charlotte's Web (CWBHF)The inspiration for the founding of Charlotte's Web (OTCMKTS:CWBHF) was a CNN documentary -- in 2013 -- about Charlotte Figi, whose health was significantly improved because of a hemp extract.Fast forward to today: The company is the No. 1 brand for the hemp-derived CBD market in the U.S. It definitely helps that it has distribution across more than 3,000 retail locations.And yes, growth has been strong. In the latest quarter, revenues jumped by 57% to $17.7 million and adjusted EBITDA came to $5.4 million, up 31%.To better capitalize on the CBD opportunity, CWBHF recently issued $71.5 million in stock. This will be for cultivation and production to meet surging demand. Here's what the company's CEO, Hess Moallem, had to say: "In general, broader consumer awareness of the benefits of cannabinoids, namely cannabidiol (CBD), and whole plant hemp extract is driving increased uptake in both our retail channels and within our e-commerce platform."In other words, it seems like a pretty good bet that the growth will continue for some time. Zynerba Pharmaceuticals (ZYNE)Zynerba Pharmaceuticals (NASDAQ:ZYNE) is a clinical-stage biotech company that develops cannabinoid therapies for a variety of rare diseases. They include: * Fragile X Syndrome (FXS): This is a developmental disability that has been known to cause autism spectrum disorder. FXS impacts 71,000 people in the U.S. and there are no drug indications for it. * Developmental and Epileptic Encephalopathies (DEE): This is an epilepsy syndrome that involves severe cognitive impairment. About 45,000 children and adolescents have this in the U.S. * Autism Spectrum Disorder (ASD): This includes autism and Asperger's syndrome. ASD affects less than 1 million pediatric and adolescent patients. * 7 Retail Stocks That Will Continue to Rebound in 2019 ZYNE's main candidate is Zygel, which is a CBD formulation gel for transdermal delivery. As for the FXS treatment, there is expected to be a pivotal data release in the second half of this year. And if the trial is positive, then the company will file a New Drug Application (NDA) for Zygel in the first half of 2020. Canopy Growth (CGC)Since 2016, Canopy Growth (NYSE:CGC) has been building its CBD business, with a focus on consumer packaged goods. The company has since created a vertically integrated platform for that includes a set of technologies that have pending patents. What's more, the hemp division is expected to yield 7,000 kilos of hemp-derived CBD on an annual basis. Granted, this cannot be used in the U.S. market. Yet CGC is likely to be a solid partner. For example, the company recently struck a deal with Martha Stewart's Sequential Brands Group, so as to develop CBD remedies for pets.It helps that CGC has substantial resources, which came from a mega $4 billion investment from Constellation Brands (NYSE:STZ). STZ has a strong global footprint -- with operations in the U.S., Mexico, New Zealand, Italy and Canada -- as well as a set of well-known consumer brands, such as Corona Extra, Corona Light, Modelo Especial, Modelo Negra and Pacifico. All in all, there is quite a bit of synergy for CGC.In the meantime, the company is growing at a staggering pace. In the latest quarter, revenues soared by 282% to $83 million. GW Pharmaceuticals (GWPH)The origins of GW Pharmaceuticals (NASDAQ:GWPH) go back to 1998. It was then that Dr. Geoffrey Guy and Dr. Brian Whittle co-founded the company to focus on developing therapies using cannabinoid formulations to target areas like epilepsy, glioma and schizophrenia.As of today, the lead product is a liquid formulation of a CBD, called Epidiolex, which received FDA approval in 2018 (the expectation is that there will be an approval in Europe in the second quarter). The drug targets the rare conditions of Lennox-Gastaut syndrome (LGS) or Dravet syndrome, which are variations of epilepsy. Furthermore, there are other indications for Epidiolex, such as Tuberous Sclerosis Complex and Rett Syndrome. * 7 ETFs for a Millennial Portfolio But of course, the company has other treatments. Note that GWPH is looking to get approval in the U.S. for Sativex, which is an oromucosal spray for multiple sclerosis. It is currently available in 25 countries. Horizons Marijuana Life Sciences ETF (HMLSF)If you do not want to buy individual CBD stocks, then you can consider an exchange-traded fund, such as the Horizons Marijuana Life Sciences ETF (OTCMKTS:HMLSF). With this, you'll get exposure to companies like Canopy Growth, Aurora, GW Pharamceuticals, HEXO and Tilray (NASDAQ:TLRY).In all, there are 59 stocks in the portfolio and the net assets are about $1 billion (in Canadian currency). The expense ratio is also 0.75%.Tom Taulli is the author of High-Profit IPO Strategies, All About Commodities and All About Short Selling. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Retail Stocks That Will Continue to Rebound in 2019 * 5 Stocks To Buy for the Happiest Employees * 7 ETFs for a Millennial Portfolio Compare Brokers The post 7 Marijuana Stocks to Play the CBD Trend appeared first on InvestorPlace.
The ongoing wave of cannabis legalization is good for pot companies, but the trend could be a downer for alcohol stocks, warns DataTrek.
Editor's note: InvestorPlace's Earnings Reports to Watch is updated weekly. Please check back next week for our latest earnings picks.The worry cited in this space over the past few weeks has been consistent. The earnings calendar has been tapering off since mid-February -- removing a catalyst that had moved stocks higher. Fourth-quarter earnings reports -- with some help from the final quarter of U.S. tax reform benefits -- were generally strong. Without that boost, however, the fear was that investors would focus on other factors, and with slowing global growth and worldwide political unrest, they might not like what they would see.For the most part, that fear has been unfounded. The S&P 500 is up double-digits year-to-date, and touched a five-month high on Thursday. All-time highs are just a few percentage points away. But Friday's selloff -- the index is off more than 1% in early trading -- shows that concerns still lurk. International growth remains weak. That puts an enormous amount of pressure on the U.S. consumer to keep the domestic economy -- and stock market -- humming.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAgain, one session doesn't make a trend. But with valuations creeping back up, investors might start again focusing on the risks in the market. The earnings calendar next week should give some signs as to whether that will be the case going forward. One of the hottest -- and highest-risk -- sectors gets a report from one of its key constituents. A high-priced consumer darling will try and keep its momentum going. And a housing leader will provide another gauge of sentiment in that critical industry. * 7 Beaten-Up Stocks to Buy as They Reverse Course The results from these three companies may not move the market. But the reaction to the results, for a number of reasons, could give some color as to how investors are feeling as they wait for the earnings calendar to ramp up next month. Cronos Group (CRON)Source: Shutterstock Earnings Report Date: Tuesday, March 26, before market open Marijuana stocks like Cronos Group (NASDAQ:CRON) have been among the biggest beneficiaries of the market rally this year. At the highs earlier this month, CRON stock had tripled since late November. A $1.8 billion investment in CRON stock by tobacco giant Altria (NYSE:MO) drove some of the enthusiasm. But the return of the 'risk-on' trade has boosted the entire sector, providing another tailwind.Of late, however, investors are viewing the space, and Cronos stock, with more caution. CRON stock has pulled back about 17%. Analysts are becoming more skeptical as well.Cronos earnings on Tuesday morning aren't likely to change the fundamental case here all that much. Like other marijuana players, Cronos remains an early-stage company. A 'beat' to earnings estimates doesn't in turn mean the valuation goes higher; results for a single quarter simple aren't that material, yet.But commentary will be closely watched. Most notably, what exactly does Cronos plan to do with the $1.8 billion in cash received from Altria? And even for investors with little or no exposure to cannabis, trading in CRON stock is worth monitoring. Are investors looking for any good news as an excuse to buy more? Or is the converse true: does CRON stock sell off simply because investors again need a reason to buy high-flying pot stocks? If marijuana sector investors again are focusing on risk, that would be a strong sign that the rest of the market might start doing the same. Lennar (LEN)Source: Shutterstock Earnings Report Date: Wednesday, March 27, before market open Housing plays like homebuilder Lennar (NYSE:LEN) started moving lower before the broad market last year. It wouldn't be shocking if history repeated itself in 2019. With input and labor costs moving higher, and demand for new housing appearing to slow, homebuilders and their suppliers remain at risk of getting squeezed.LEN stock has bounced 28% since hitting a multi-year low in late December. But with the stock trading at less than 8x forward EPS estimates, there's still room for upside -- if the company can continue restoring investor confidence. * 7 Retail Stocks That Will Continue to Rebound in 2019 The fiscal Q1 earnings report on Wednesday morning could help on that front -- to an extent. The first quarter is Lennar's slowest quarter, limiting its importance somewhat. Still, the full-year outlook -- particularly with interest rates coming down -- will be watched closely not only by LEN shareholders, but investors across the housing universe. Many stocks in the sector remain cheap; Lennar earnings could help show whether they should be. Lululemon Athletica (LULU)Source: Shutterstock Earnings Report Date: Wednesday, March 27, after market close It was only a few years ago that earnings reports from retailers were seen as proxies for the health of the U.S. consumer. If Macy's (NYSE:M) or JCPenney (NYSE:JCP) -- or looking back a bit further, Sears Holdings (NASDAQ:SHLDQ) -- were struggling, the most likely culprit was consumer confidence.Obviously, in the age of Amazon.com (NASDAQ:AMZN) and shrinking mall traffic, that's no longer the case. But earnings from Lululemon Athletica (NASDAQ:LULU) can been seen as a similar, albeit much less broad, indicator. Lululemon certainly has a much more narrow base in terms of both geography and its customer base. But if consumers still are willing to pay up for Lululemon merchandise, that suggests some level of confidence.The report also should give some color to the 'athleisure' fashion trend. Nike (NYSE:NKE) stock fell this week after slowing North American sales. A similar miss from Lululemon might suggest that athletic wear strength is fading. And that could echo across the sector, with investors in stocks like adidas AG (OTCMKTS:ADDYY) and Under Armour (NYSE:UA,UAA) watching closely.Here, too, the reaction to the report will be telling. Are investors willing to push higher a stock that already trades at 34x forward earnings? Particularly when that stock is in retail -- one of the most challenged sectors in the market?Again, none of these earnings reports can move the market. But there's a theme to watch here. If CRON sells off, if LEN numbers don't convince investors and if LULU can't rise higher, then the question ahead of earnings season becomes clear. What will it take for stocks to reclaim all-time highs? It's going to take strong corporate earnings -- but if next week's batch isn't enough, next month's might not be, either.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Retail Stocks That Will Continue to Rebound in 2019 * 5 Stocks To Buy for the Happiest Employees * 7 ETFs for a Millennial Portfolio Compare Brokers The post 3 Earnings Reports to Watch Next Week appeared first on InvestorPlace.
Cannabis stocks are climbing this year and Aurora Cannabis (NYSE:ACB) is among the leaders of that pack. Shares of ACB stock have nearly doubled year-to-date and are in the midst of a breathtaking March rally of more than 33%.Source: Shutterstock Returns like those, particularly in the short time frames, might give investors reasonable pause about Aurora Cannabis stock, or any other stock for that matter. Indeed, the risk/reward proposition on ACB stock looks a lot different today than it did at the start or 2019. In terms of upside potential, Aurora Cannabis stock would need to rally another 28% to reclaim its 52-week high.That is not an impossible climb for ACB stock, but the near- to medium-term issue is finding upside catalysts because plenty of good news is already baked into this marijuana stock. For example, ACB surged earlier this month on news activist investor Nelson Peltz is joining the company as an advisor. That sent ACB stock to a double-digit intraday gain and the shares are up more than 11% since then.InvestorPlace - Stock Market News, Stock Advice & Trading Tips What Analysts Say About ACB StockSell-side analysts are not correct about any stock 100% of the time. Investors that acknowledge that can help mitigate disappointments. That said, some analysts are bullish on ACB stock. * 10 Stocks on the Rise Heading Into the Second Quarter Earlier this month, Cowen's Vivien Azer -- one of the most respected analysts tracking marijuana equities -- initiated coverage of Aurora Cannabis with an Outperform rating and a price target that works out to the equivalent of about $10.50 in U.S. dollars."While establishing 20% market share has been an early success story in Canadian adult use cannabis, the company is uniquely positioned to drive leadership in both share and profitability," Azer wrote in a note, according to Barron's.The analyst "believes that Aurora will deliver positive earnings before interest, taxes, depreciation and amortization by its fiscal fourth quarter in June, making it one of the first of its peers to reach this milestone," reports Barron's.Some analysts also view valuations on ACB stock as favorable relative to other marijuana names. Consider this about the valuations assigned to some weed equities: Aurora Cannabis stock trades at a forward P/E ratio of 101 and a price-to-book ratio of 3, according to Morningstar data, and that's considered a value relative to its peer group. Peltz PowerAs was noted above, news of the activist investor Peltz getting involved with Aurora Cannabis is priced into the shares, but that does not diminish the importance of this news going forward. One of the biggest drags on Aurora Cannabis stock has been the company's inability to form partnerships with more mainstream companies as some of its rivals have.Think Constellation Brands (NYSE:STZ) taking a multi-billion stake in Canopy Growth (NYSE:CGC) or Altria (NYSE:MO) forming a partnership with Cronos Group (NASDAQ:CRON). Last year, it was rumored that Coca-Cola Co. (NYSE:KO), the world's largest soft drink company, held talks with Aurora to develop cannabidiol-infused beverages, but a deal did not materialize.Peltz has long tradition of working with management teams -- particularly at large consumer staples companies -- to streamline operations and bolster efficiencies to enhance profitability.Aurora Chairman Michael Singer mentioned the beverage, cosmetics, health and wellness and pharmaceutical industries as potential growth areas for his companies and Peltz could help the upstart cannabis company make inroads into those arenas. * 5 Stocks To Buy for the Happiest Employees The Bottom Line on ACB StockAurora Cannabis definitely shows promise in the marijuana space, and Nelson Peltz only adds to the pot stocks' legitimacy. For now, however, all of the good news looks priced into ACB stock -- even if a valuation of 100x forward earnings is a steal in the cannabis area.Todd Shriber does not own any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Specialty Retail ETFs to Buy the Industry's Disruption * 5 Stocks To Buy for the Happiest Employees * 3 Out-of-Favor Consumer Stocks to Buy Compare Brokers The post There's Smoke, But Is There Still Fire for ACB Stock? appeared first on InvestorPlace.
[Editor's note: This story was previously published in February 2018. It has since been updated and republished.]Often, when analysts or bloggers talk up the potential of marijuana stocks, the focus is on the consumer side of the industry. But some of the best stocks in the pot sector may be medical marijuana stocks.Indeed, it's on the medical side where growth likely is to be largest in the near term. Canada did legalize recreational marijuana in October, but investors promptly sold the news in response. U.S. legalization is likely to be a long slog. Attitudes are mixed in Europe -- but even in legalized markets anywhere, black market (and untaxed) operators will be able to take share.InvestorPlace - Stock Market News, Stock Advice & Trading TipsMeanwhile, approval of medical marijuana (in the U.S. and elsewhere) seems to be moving at a faster pace. In such a highly regulated market, black market and even smaller producers likely will be shut out. Quality and consistency will be key. Here, scale will matter. And those companies that win early have the best chance of becoming market leaders -- and providing big gains for investors. * 10 Stocks on the Rise Heading Into the Second Quarter As always -- and particularly in this space -- investors need to mind the risks and size positions accordingly. But for investors who see medical marijuana stocks as the next big thing, these three are the best stocks for investors enamored with weed.Source: Shutterstock Charlotte's Web (CWBHF)Charlotte's Web (OTCMKTS:CWBHF) has become one of the leading players in CBD oil (cannabidiol). And though Charlotte's Web products are made from hemp -- at least for now -- instead of marijuana, the stock still looks like one of the best plays in the sector.InvestorPlace's Matt McCall named CWBHF (the stock also trades on the Canadian Securities Exchange, ticker CWEB) as his pick of the best stocks for 2019. And the case makes some sense. CBD oil sales are soaring and Charlotte's Web is a market leader. As McCall pointed out, the federal farm bill in the U.S. provided a catalyst by legalizing hemp.With so many customers yet to try CBD oil -- and so many existing users attached -- market growth should be huge. And while CWBHF isn't cheap from a valuation standpoint, its position as a market leader should allow it to grow into its valuation.Source: Shutterstock Cronos (CRON)Of late, marijuana producer Cronos Group (NASDAQ:CRON) has made the headlines for its consumer business. Most recently, tobacco giant Altria (NYSE:MO) invested some $1.8 billion in the company. The combination of Altria's advertising and distribution reach and Cronos' production capabilities would seem best fit for the consumer side of the business.But investors can't ignore that Cronos is a medical marijuana stock as well. In fact, it's that business that drives the majority of revenue at the moment. And it also has given the company a beachhead in multiple markets around the world, from its home market of Canada to Germany, Israel and Poland. * 5 Cloud Stocks to Help Your Portfolio Fly I wrote after the Altria deal that investors should stay patient with CRON stock. And in this market, that might still be wise advice. But with the stock seemingly having stabilized at around $20 it looks as if this stock is for real.Source: Shutterstock CannTrust (CTST)CannTrust (NYSE:CTST) has been one of the biggest victims of the post-legalization selloff. The stock lost more than half its value and touched a 52-week low in the process last year. Since it's December fall, it has more than doubles and remains on the uptrend.Unlike many peers, the company is profitable. And its established leadership in the Canadian medical marijuana industry should drive consistent growth and allow CannTrust to stay profitable. There is some retail exposure here as well, but unlike peers, CannTrust seems to have room to drive upside on the medical side alone.CannTrust also was able to get a listing on the New York Stock Exchange this year. Admittedly, uplisting hasn't helped pot stocks in and of itself (most notably Aurora Cannabis (NYSE:ACB) took a lot longer to take off than was expected), but it certainly didn't hurt.From a profitability standpoint, at least, CNNTF seems like one of the best stocks in the pot sector. And with valuation near the lows, at least some of the risks here likely are priced in.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 of the Best Stocks to Buy for a Dovish Federal Reserve * 5 Best Fidelity ETFs for Retirement Savers * 7 Blue-Chip Stocks That Could Lead the Market Higher Compare Brokers The post 3 Medical Marijuana Stocks to Buy appeared first on InvestorPlace.
Shares of Aurora Cannabis (NYSE:ACB) have been soaring lately, up 25% in just a few trading sessions. Because of this giant move, investors are wondering if now's the time to get in on ACB stock or if a 25% rally means they missed their chance.Source: Shutterstock What's the verdict?I wouldn't say there's no upside left, but the risk-reward profile has certainly muddied. Unfortunately, investors who are suffering a case of FOMO -- a "fear of missing out" -- have no reason to be. There was ample time to buy this name, even after the big rally.InvestorPlace - Stock Market News, Stock Advice & Trading TipsLet's look at the charts to see why. Trading ACB Stock Click to Enlarge There are so many choices in the investing world that I do not like to be a "told you so" person. Meaning that even studious followers of the stock market can't act on everything they see and read. In the case of ACB stock, though, perhaps investors can extract a lesson. * 7 Video Game Stocks on Steep Discount Notice how the stock gapped higher by about $1 per share last week, closing near $9 after previously closing near $8. Many would argue that this ~12.5% gain was simply too much of a rally and they'd have to move on to something else. I needed to see how ACB stock would trade over the next few days, too, as I don't want to chase a double-digit move.The next day ACB stock put in an "inside day." That's where a stock's daily range trades within the range of the prior day. Notice on the chart above how the second candle following the big gap-up candle is within its range? After a big rally like this, that's a great consolidation pattern that bulls want to see. It shows that longs aren't winning to sell and shorts don't have enough "oomph" to drive it down.The next day, ACB stock began what looked like another inside day, before rocketing higher. In other words, this price action allowed investors to hop on before an 11% move higher.So what now?Shares of Aurora Cannabis stock are stretching into overbought territory. However, that does not mean it cannot continue higher. I wouldn't mind seeing how ACB stock does over the next few sessions and if we get a slight pullback before moving higher again.Keep in mind, ACB stock has breached $12 more than once in the past 12 months. Perhaps it's on its way of doing it a third time. Valuing Aurora Cannabis StockSo what got Aurora Cannabis stock rallying so strongly anyway? The company brought activist investor Nelson Peltz on board to advise on partnerships and global expansion.They didn't pick a bad advisor, either. Peltz has a long list of contacts and the hedge fund manager is a master in the consumer packaged goods space. Whether this leads to a partnership with a well-known blue-chip company or not remains to be seen. But adding him in this role certainly doesn't hurt Aurora's chances.That said, we're still very much in the "land grab" phase of the cannabis market. While growth is impressive -- as ACB stock grew sales 339% year-over-year last quarter -- the valuations do not support these names. For instance, while revenues more than quadrupled last quarter, sales came up just short of $39 million. With a $10 billion valuation, that growth better continue for some time in order for it to be justified.But if there wasn't an opportunity here, we wouldn't have Constellation Brands (NYSE:STZ) taking a multi-billion stake in Canopy Growth (NYSE:CGC) or Altria (NYSE:MO) doing the same thing with Cronos Group (NASDAQ:CRON). There's money to be made and an opportunity to be had with states and countries legalizing marijuana, both for medical and recreational use.That said, it's not a short-term or risk-free endeavor for investors.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long CGC. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Invincible Stocks Leading The Bull Market Higher * 5 Dow Jones Stocks Coming to Life * 7 of the Best High-Yield Funds for 2019 and Beyond Compare Brokers The post Did You Miss Your Chance to Buy Aurora Cannabis Stock? appeared first on InvestorPlace.
Cronos Group (CRON) was the first Canadian marijuana stock to gain listing on the Nasdaq (others have followed in its footsteps), notes Tyler Laundon, editor of Cabot Small Cap Confidential.
So far, 2019 has been good to Cronos Group (NASDAQ:CRON). Its share price has more than doubled this year. And the CRON stock gains make some sense.Indeed, as I wrote in December, the $1.8 billion investment in CRON stock by Altria (NYSE:MO) seems to be a game-changer. Among cannabis stocks, only Canopy Growth (NYSE:CGC), with $4 billion in hand from its deal with Constellation Brands (NYSE:STZ), looked to be in a stronger financial position. And yet, amid a market sell-off, investors largely shrugged at Cronos Group stock.That's changed in 2019, obviously, and perhaps it's changed a little too much. I still believe CRON stock needs to settle down. And I'm not alone. Wall Street has turned notably bearish on the shares in recent weeks. Ahead of Cronos Group earnings next week, those analysts might have a point.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Cautious Turn on CRON StockAs MarketWatch pointed out last week, the Street on the whole actually sees downside ahead for CRON shares. Some 11 analysts on average have a target price of $20.30, or 6.6% below current levels.And recent coverage hasn't been all that positive. Per MarketWatch, BMO Capital Markets downgraded CRON to underperform. Analyst Tamy Chen pointed out that CRON trades at 80x EBITDA estimates -- two times the multiple sported by Aurora Cannabis (NYSE:ACB) and higher than Canopy Growth.Chen isn't alone. GMP Securities cut Cronos to hold earlier this month. Cowen (NASDAQ:COWN) initiated at neutral. Jefferies Financial Group (NYSE:JEF) began its coverage of Cronos Group stock with an underperform in late February (though CRON stock rose anyway). * Top 7 Service Sector Stocks That Will Pay You to Own Them To be sure, the Street isn't as always right. And even bearish analysts -- including the team at Jefferies -- have pointed to a massive opportunity in both recreational and medicinal cannabis.But for investors looking for the best cannabis play, it's worth noting that the analysts aren't just focused on valuation. BMO has pointed out that Cronos is trailing other Canadian producers in building out capacity. According to Yahoo! Finance, Jefferies cited concerns about when, exactly, Cronos would spend the funds from Altria -- and how much support the tobacco giant would give the pot producer in the early going.While it's easy to dismiss analyst concerns -- and, again, it's far from guaranteed that the Street is correct -- the factors driving the downgrades should be given some consideration. This isn't a case of analysts simply hollering about near-term valuation metrics, or arguing that cannabis stocks represent some sort of bubble.The common thread in recent coverage isn't that Cronos Group is failing or that it has no opportunity. Rather, the worry is that the company isn't moving fast enough in an industry where being a first mover increasingly looks like a key advantage. Earnings and Cronos Group StockIt's not just analysts who are making that point. InvestorPlace contributor Luke Lango made the case last month that Canopy Growth, not Cronos, was the best play in cannabis. One reason: CGC stock is actually cheaper on a per-kilogram basis.That can change if Cronos ramps production and puts its Altria funds to work. So far, however, that hasn't quite been the case. In fact, the company earlier this month swapped its shares of privately held Whistler Medical Marijuana for shares in Aurora Cannabis. That deal highlights the difference between the two companies. * 15 Stocks That May Be Hurt by This Year's Big IPOs Aurora's strategy clearly is to take as many shots at as many opportunities as possible in the shortest amount of time. With that strategy, it's possible that Aurora is taking on too many projects. But in a fluid market (from both a competitive and regulatory perspective), and one with multiple products (recreational, medical, CBD, edibles, etc.), Aurora is trying to gain exposure to as many markets as possible.Cronos doesn't have to take the same path as Aurora. But with the stock near the highs -- and triple late November levels -- it's going to need to show something with earnings next week. That may be discussion of what exactly it plans to do with its $1.8 billion in newly received cash. It may be clarity on Altria's role. (Note that Altria's senior director of corporate strategy is joining Cronos as chief financial officer, perhaps a step in the right direction.) It may be talk of additional M&A, after a huge win on the Whistler deal. (Cronos appears to have invested CAD$4 million [$3 million] in the company - and received C$175 million in Aurora stock.)Whatever it is, with the highest valuation in the cannabis stock, the status quo isn't enough. Cronos needs to post an impressive earnings report next week -- and not just in the numbers. Rather, the company needs to convince investors that it can take advantage of its cash, and put that cash to work to drive growth. It won't be easy - and at these prices, expectations are going to be high.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Financial Stocks to Invest In Today * 7 Single-Digit P/E Stocks With Massive Upside * 5 Chip Stocks on the Rise Compare Brokers The post Who's Made The Right Call On Cronos Group Stock? Altria or Analysts? appeared first on InvestorPlace.
We often hear jokes about the lofty valuations of cannabis stocks. They have huge market capitalizations with only a tiny fraction of them in actual revenues. Tilray (NASDAQ:TLRY) is perhaps the poster child for that joke since its short squeeze that occurred last September. Then Tilray stock skyrocketed to $300 per share in a day, but only to perhaps mark the absolute top forever.Source: Shutterstock First, let me assure you that I am not a perma-bull on pot stocks. Yes, I only trade them from the long side, but I use the technicals to guide my decisions. A few weeks ago, I shared a long entry opportunity in Tilray stock and it paid quickly.This morning, the stock is spiking and there could be another setup looming.InvestorPlace - Stock Market News, Stock Advice & Trading TipsLast night, TLRY reported earnings and investors are happy with what they saw because TLRY stock is spiking on the headline. But in classic TLRY fashion, the knee jerk reaction last night was violent as the stock fell $5, then rallied at $4. This morning, it is still holding in the green up 3%.The results were mixed as management beat the sales expectations but also reported some extra expenses. For now, this is something Wall Street should ignore for as long as TLRY is a growth stock.If this were a mature company, then investors can demand tighter profit controls, but this is a situation where the cannabis companies are plowing into completely new territory so they deserve a lot of leeway, more so than usual in fact. * The 10 Best Stocks to Buy for the Bull Market's Anniversary The cannabis industry is still in its infancy on Wall Street. Even the so-called experts rely more on hunches and guessing to forecast the fundamentals. So perhaps until there is enough history to establish tangible expectations, I greatly rely on the technicals to guide me. Charts don't lie and they outline the trends and important levels.However, relying on charts doesn't mean I completely dismiss the importance of the company metrics. Perhaps the most important one that TLRY reported last night was that it sold 2,053 kilos, which is three times that of last year. This combined with a 110% increase in revenues for the same period, which tells me that the company is executing well on its growth plans.TLRY's Chief Executive Officer Brendan Kennedy explained away the margin pressures by highlighting the expansion of its facilities. The company added seven new facilities, so the ramp-up time will keep profitability at odds until the revenues catch up to the expenses. Overspending is the necessary evil that growth companies have to endure.Meanwhile, they maintain a relatively healthy balance sheet with $500 million in cash. This will ensure that they are able to pursue their next focus areas in the U.S. and Europe. This is not only by targeting the recreational legalization trends, but this also includes making the CBD and medical applications. Bottom Line on Tilray StockIn short, the company is succeeding in its mission, so Tilray stock should have more upside potential in the long run. Those who want to bet on its success for years to come need not worry about the minutia of action here. Moreover, they are not going at it alone. Management struck a partnership with Anheuser-Busch InBev (NYSE:BUD), which validates TLRY's efforts in my opinion. If it's good enough for a massive company like BUD, then it's good enough for the general investor.Meanwhile, for those who prefer to trade the stock short term instead, the technicals can definitely provide a road map.Year-to-date, TLRY stock came into the earnings event only up 2.4% compared to the S&P 500's 12% for the same period. Clearly, the stock is stuck below $80 per share since December. Even worse is how TLRY compares to Canopy Growth (NYSE:CGC), Cronos (NASDAQ:CRON) and Aurora Cannabis (NYSE:ACB), which are up 70%, 108% and 100%, respectively, for the same period. * 7 Financial Stocks to Invest In Today The overnight bounce in Tilray stock brought it into potential resistance. The area around $76 to $78 per share has been pivotal for months. This usually creates resistance as both bulls and bears want to win the battle there. In January, the TLRY bulls were able to over come it, but only for a few days. Unlike the stock market in general, TLRY has failed to recover the ledges from which they crashed into the Christmas correction.Specifically, $77.50 is my area of interest. If they close TLRY above it and successfully retest it for footing, I'd consider it an opportunity to trade the upside potential to recover the January highs. But even then, there are areas of resistance here and at $82 per share. So I would need to see a clear breach of the first line of resistance before I chase it long.As for support, the bears could get more of an upper hand if they can break through $70 per share. Oddly enough, Tilray stock retested its December lows just a few days ago. This is happening while the S&P 500 is still on a tear. The wound is still fresh. Below it, there is a trap door to the mid-fifties. This is not a forecast, but merely one of the available scenarios at hand.It is best to wait for the break out from the zones noted before chasing either the upside or the downside potentials.Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. You can follow him as @racernic on Twitter and Stocktwits. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Financial Stocks to Invest In Today * 7 Single-Digit P/E Stocks With Massive Upside * 5 Chip Stocks on the Rise Compare Brokers The post Why Tilray Stock Is Still Worth a Look Despite Earnings Flop appeared first on InvestorPlace.
HENDERSON, NV / ACCESSWIRE / March 19, 2019 / From a dirty little secret to one of the fastest growing industries in the world, cannabis has come a long way. As more states are legalizing medical marijuana ...
The ongoing cannabis stock craze will likely see another move after Monday's closing bell. That's when Canadian pot conglomerate Tilray (NASDAQ:TLRY) is slated to report its fourth-quarter numbers, perhaps pushing Tilray stock out of the sideways rut it's been in since December.Source: Shutterstock Which direction TLRY ends up moving (if it moves at all) remains in question. While investors will certainly be interested in seeing how much marijuana Tilray sold during the quarter -- recreational marijuana in particular, the real scrutiny will be on company has continued to evolve. For Tilray, Q4 was a period to form partnerships and make acquisitions. The rhetoric about that dealmaking will be the key to overcoming any valuation problems or worries about sustained losses for Tilray stock. Tilray Earnings PreviewFor the quarter ending on December 31st, analysts expect TLRY to report revenue of $15.9 million, although some outside estimates put the figure closer to $18.3 million.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 3 Earnings Reports to Watch Next Week That still won't be enough to pull the young, budding company out of the red though. Those same pros are also calling for a loss of 15 cents per share of Tilray stock -- a modest improvement on the loss of 20 cents per share booked during Q3 of last year.It is a work in progress, as is the case with all cannabis stocks at this time. Actual net profits may still be a distant goal.The industry is making progress to that end, however, with some help from much bigger friends. Pot-Laced PartnershipsConstellation Brands (NYSE:STZ) got the pot-partnership ball rolling in August of last year, via a $4 billion investment in Tilray rival Canopy Growth (NYSE:CGC). Altria Group (NYSE:MO) followed suit in December, making a $1.8 billion investment in Cronos Group (NASDAQ:CRON).Both deals were largely intended to secure a stake in the marijuana market, even without knowing exactly what the future may hold. Though marijuana is now legal in Canada and several U.S. states, it remains illegal at the Federal level in the U.S.The newly-formed partnerships are aiming to innovate new products. Tilray Is Moving SlowerTilray has thus far lagged the innovation and team-up movement. And although the Canadian government legalized cannabis in mid-October, Tilray didn't actually sell any recreational cannabis during the first two weeks it was allowed to do so.Tilray has been busy building its team though. Near the end of last year it acquired licensed producer Natura Naturals at a cost of $26.3 million. And, around that same time it inked distribution deals with the pharmaceutical industry, and has agreed to work with Anheuser Busch Inbev (NYSE:BUD) to create and market cannabis-based drinks. In December of last year, the company rounded out its network with a $317 million purchase of Manitoba Harvest.The Q4 report will be the first to include recreational sales, though it still won't reflect the full revenue potential of Tilray.In that light, investors may want to worry less about Q4 numbers and focus more on how it's piecing together its organization in an increasingly competitive environment. Looking Ahead for Tilray StockThe TLRY story is certainly an exciting one, and undoubtedly cannabis has a bright future. But, it remains to be seen if Tilray has a future that's bright enough to merit its $7.0 billion valuation.More than a few investors don't think it does. As of the most recent look, nearly 25% of the stock's float is held as a short position, meaning nearly four million shares of TLRY are held by traders betting Tilray stock will move lower before it moves higher. * 7 Small-Cap Stocks That Make the Grade Those bets could backfire in a big way though. Should the response to Monday's post-close earnings report be a bullish one, a sharp rise in the price of Tilray shares could cause those short-sellers to panic and buy shares to exit their trade, fanning the bullish flames.As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 5 of the Best Stocks to Buy Under $10 * 7 Single-Digit P/E Stocks With Massive Upside * 7 Best Quantum Computing Stocks Trading Today Compare Brokers The post Why Tilray Stock's Q4 Report Shouldn't Be About Q4 Numbers appeared first on InvestorPlace.
Credibility. Without it, a growing company in a competitive arena is lost. With it, it can be a steamroller.Not that Aurora Cannabis (NYSE:ACB) was lacking credibility, but now that it has activist investor Nelson Peltz on board as an advisor, the budding company has much more than it did. ACB stock jumped 14% on Wednesday, ultimately because the hedge fund manager will help Aurora speak with all the right people that can help take the organization to the proverbial next level.Other reasons were cited for the big jump in Aurora Cannabis stock, and those weren't necessarily wrong. But, it's the sudden jolt of Peltz-related credibility that fueled the move.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAnd yes, for some investors who still weren't quite convinced, this could be enough of a reason take a shot on Aurora Cannabis stock. Missing PiecesACB been something of an outlier among its pot peers, actually. Canopy Growth (NYSE:CGC) last year attracted Constellation Brands (NYSE:STZ) as a major stakeholder. Cronos Group (NYSE:CRON) is in bed with Altria Group (NYSE:MO) which now owns 45%. Aurora doesn't have a major partner yet. * 7 Winning High-Yield Dividend Stocks With Payouts Over 5% The reasons why aren't exactly clear. The Canadian company has as much to offer an aspiring cannabis player as Cronos or Canopy Growth.Those reasons, however, are also now irrelevant. Peltz has already dropped hints that he intends -- as Aurora is tacitly hoping -- to set up deals."I look forward to working with Terry (CEO Terry Booth) and the extended Aurora team to evaluate its many operational and strategic opportunities," Peltz commented in the official statement, adding "including potential engagement with mature players in consumer and other market segments."Cowen analyst Vivien Azer agrees, writing of the news: "Peltz brings a network of relationships with large potential strategic companies that ACB could partner with across medical and consumer applications. In addition, we think ACB will be more patient in partnership selection than its peers, particularly regarding equity investment."Some investors are particularly celebrating the fact that Peltz brings a wealth of experience within the food and consumer goods segment.Trian [Peltz's hedge fund] has been involved with a number of consumer packaged goods companies such as PepsiCo (NASDAQ:PEP), Keurig Dr Pepper (NYSE:KDP), Procter & Gamble (NYSE:PG), Kraft Heinz (NYSE:KHC), Mondelez (NASDAQ:MDLZ), among others, noted GMP Securities consumer goods analyst Martin Landry, who upgraded ACB stock following the announcement. Landry goes on to explain: "We believe he could be instrumental in facilitating discussions with large consumer packaged goods companies."The two upsides are just the tangible manifestations of a much-bigger benefit Peltz brings to the table, however. Credibility (and Motivation)While Altria and Constellation are recognizable brand names, neither are established as dealmakers. They're interest in cannabis is largely self-serving, and their plans for their partnership are limited to the development of cannabis-based products.Not so for Nelson Peltz and Aurora Cannabis. He's a known dealmaker that some companies and many investors like to see get involved, especially when potential value has been locked up for too long.Peltz is also not limited to creating synergy between just two organizations. He's willing and able to establish as many partnership with as many entities as possible, without stirring up concerns that he may be building up his partners' competitors as well. He will be doing that, but at least all partners know where they stand, and that Aurora is looking to become a supplier to multiple customers. There's room for all of them, and Peltz will be able to make introductions ACB couldn't on its own. * 7 Top Stocks to Buy From Goldman Sachs' Secret Portfolio Perhaps more than anything else, however, Peltz wants the same thing existing Aurora Cannabis stock holders want -- for the share price to rise. He's being granted options for up to nearly 20 million shares of ACB stock at $7.74 a share, vested gradually over the next four years.So, Peltz doesn't make any real money unless the stock performs well. Bottom Line for ACB StockDon't misread the message. While this is certainly a big win for Aurora, the company remains a risky proposition for multiple reasons.One of them is that cannabis remains illegal at the federal level in the United States despite widespread state-level legalization. Pot's future, and the future of all its derivatives, is still a bit dazed and confused.There's also the not-so-small reality that cannabis and now cannabis-based products are quickly becoming a commodity, which could crimp margins for the debt-laden Aurora.Nevertheless, if Peltz can pull the right strings -- and he's certainly got strings to pull -- the bullish case for Aurora Cannabis stock is bolstered. It's not a reason in and of itself to buy the shares. But, for investors on the fence about stepping into a position, the hedge-fund player's news may be even bigger than the market realizes.As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 15 Stocks Sitting on Huge Piles of Cash * The 10 Best Stocks to Buy for the Bull Market's Anniversary * 7 Dividend Stocks With Big Yields Compare Brokers The post Aurora Cannabis, Nelson Peltz Tie-Up is Ultimately About One Thing appeared first on InvestorPlace.