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Follow this list to discover and track the stock of publicly traded companies with exposure to cannabis
Anheuser-Busch InBev SA/NV
Altria Group, Inc.
Molson Coors Brewing Company
Canopy Growth Corporation
Canopy Growth Corporation
The Scotts Miracle-Gro Company
Aurora Cannabis Inc.
GW Pharmaceuticals plc
Cronos Group Inc.
The Green Organic Dutchman Holdings Ltd.
The Green Organic Dutchman Holdings Ltd.
Corbus Pharmaceuticals Holdings, Inc.
CannTrust Holdings Inc.
New Age Beverages Corporation
CannTrust Holdings Inc.
Terra Tech Corp.
General Cannabis Corp
ETFMG Alternative Harvest ETF
Marlboro maker Altria's investment in vaping leader Juul Labs is looking increasingly like a multi-billion dollar mistake. Juul, as well as others in the e-cigarette industry, is facing increased scrutiny from state and federal regulators.
MKM Partners initiated coverage of five Canadian cannabis companies and two U.S. multi-state operators on Friday with a cautious outlook, arguing that the current business model of cultivation will become commoditized and make it difficult for companies to build strong brands.
Bad news on the trade war front appears to have led to a fall in the broader US equity markets today. Cannabis ETFs were also trading in the red.
Chicago mayor Lori Lightfoot has introduced an ordinance regulating cannabis stores, keeping them away from the city's central business district.
MKM Partners sees reasons to be bullish on both. From booze-free bars to legalized cannabis, alcohol companies face plenty of competition for consumers’ recreational spending. Constellation Brands shares (ticker: STZ) are up 29% year to date, helped by enthusiasm among analysts, strong earnings, and hopes for its marijuana investments.
Investors’ expectations for cannabis companies like Canopy, Aurora, Tilray, Cronos and Curaleaf are just too high, says one MKM Partners analyst.
Aurora Cannabis (NYSE:ACB) stock price has been on a deep slide lately. ACB stock is down 14% since it reported earnings on September 11 for the quarter ending June.Source: Shutterstock The market was deeply disappointed. ACB had guided analysts to expect revenues from $100 million CAD to $107 million CAD for the quarter. But revenue came in at $99 million CAD.But more importantly, cash is now dangerously low. In fact, two days before the announcement, ACB closed on a $360 million credit facility which was sorely needed.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Cash Flow Losses ContinuingACB is still generating huge cash flow operating and investing losses. During Aurora Cannabis's Q4 ending June, its operating losses and investing activities drained out $180.4 million CAD. The amount includes required capital expenditures (capex) and asset sales. * 8 Dividend Stocks to Buy for a Recession By the end of June ACB's cash and securities balances had dwindled to $218.8 million CAD. So you can see why Aurora needed to raise the $360 million CAD credit facility in early September.If ACB's September quarter was using up another $180 to $200 million CAD, that credit facility just plugged a hole in a dam with a lot of cracks.The September quarter needs to start showing the company is profitable on a free cash flow basis. Otherwise, ACB will have to continue raising more debt or possibly even equity. Market Fears about ACB's LiquidityACB stock is reacting to its apparent need for more liquidity. For example, Aurora's capex spending in Q4 ending June was $167 million CAD alone. ACB sold assets worth $117 million CAD. If it had not done so, losses and investing activities would have drained out $297 million CAD during Q4.Moreover, ACB's $218.8 million CAD cash balance included $46 million of restricted cash not available to pay operating bills. That left only $173 million CAD in usable cash at June end.Here is my estimate of Aurora's cash balance as of now (mid-September): $236 million CAD ($173 million CAD June cash balance less $297 million CAD cash outflow in the September quarter, plus $360 million CAD in new credit loans on Sept. 9.)So without that September 9 credit facility Aurora Cannabis might have run out of money in the bank Aurora Cannabis Stock's $7 Billion CAD Valuation Is At RiskThe revenue miss and the recent credit facility spooked the market. These imply Aurora will not be cash-flow positive anytime soon.It seems amazing that the ACB stock price still has a $7 billion CAD market value given this liquidity balance.Canopy Growth (NYSE: CGC) has a $12 billion CAD market value. But CGC has $3.2 billion CAD in cash and securities as of June. ACB has only $236 million CAD based on the calculations above.Investors are spooked. They fear ACB will not be profitable in the next quarter either, and ACB might need to raise equity or take on more debt. An equity issue would dilute shareholders. It would likely be issued at a huge discount to the present price. Further debt raises would only add to ACB's estimated $500 million CAD debt.In summary, ACB stock is not going to rise anytime soon -- at least not until Aurora can stop the cash flow hemorrhaging. In fact, Aurora Cannabis stock could crater, especially if more equity needs to be raised. * 7 Triple-'F' Rated Stocks to Leave on the Shelf I would wait for Aurora to become cash-flow positive or until ACB stock stops its present slide. Don't try to catch a falling knife here.As of this writing, Mark Hake, CFA does not hold a position in any of the aforementioned securities. Mark Hake runs the Total Yield Value Guide which you can review here. The Guide focuses on high total yield value stocks. The Guide launched on August 30. Subscribers during September receive a 20% discount, plus a two-week free trial. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Triple-'F' Rated Stocks to Leave on the Shelf * 10 Excellent Stocks to Watch for 2020 and Beyond * 7 Consumer Stocks to Buy in an Uncertain Market The post Aurora Cannabis Stock Will Slide Until the Cash Hemorrhage Stops appeared first on InvestorPlace.
iShares on Thursday launched a new corporate bond ETF on NYSE Arca: the iShares iBonds Dec 2029 Team Corporate ETF (IBDU n/a). IBDU seeks to track the investment results of an index composed of US dollar-denominated, investment-grade corporate bonds maturing in 2029.
With a $5.25 billion market capitalization, Aurora Cannabis (ACB) is the second most highly-valued cannabis stock on the market (after Canopy Growth). It's also the most polarizing name among cannabis analysts, garnering 4 'buy,' 5 'hold,' and two 'sell' ratings in the past 3 months.(See Aurora's price targets and analyst ratings on TipRanks) On Thursday, MKM Partners analyst Bill Kirk initiated coverage on Aurora stock and told investors to sell it.What provoked the analyst to make this move? "We believe profitability for cultivators [such as Aurora Cannabis] will generally get worse before getting better. Pricing is already decreasing and supply availability will continue to grow/improve." And as any Econ 101 student can tell you, given constant demand, any increase in supply tends to push prices (and profits) down.Supporting the theory, Kirk observes that already, "most new markets have shown decreasing profitability for cultivation." (In Colorado for instance, one of the first states to "legalize" in the U.S., wholesale marijuana flower prices are said to have dropped by half in their first few years of legalization -- from $2,000 per pound in 2016 to $1,000 more recently). Despite this fact, most analysts following Aurora stock, notes Kirk, are projecting unprecedented levels of growth for Aurora Cannabis -- and in this case, "unprecedented" can be best defined as "historically unlikely."Whereas Kirk notes that consensus expectations call for Aurora to swing from negative C$157 million in profit in 2019 to positive C$241 million in 2021, the analyst predicts profitability will be much longer in coming. He projected negative earnings before interest and taxes of C$314 million this year, for example, followed by negative C$265 million in 2020, negative C$199 million -- indeed, no operating profit whatsoever before 2024 at the earliest. (And no free cash flow before 2025).And the story gets worse.As investors have soured on the marijuana story, resulting in "industry equity declines," Aurora's stock price has suffered greatly -- falling by nearly 45% over the past 12 months. This lower stock price could "cause more difficulty [for Aurora] refinancing some convertible notes coming due (March 2020)." Investors who might have happily offered Aurora money in exchange for the chance to later trade in their loan demands for shares of an increasingly higher-priced Aurora stock, will be less enthusiastic about the prospect of getting to buy into a stock that's steadily losing value.Without the ability to fund itself by issuing convertible debt, Aurora "will have to go back to the capital markets [seeking more traditional loans] at a time when profitability still hasn't been reached." Such loans could be harder to come by with Aurora looking like more of a credit risk. And even if the company can convince banks to loan it money, they will probably demand higher interest rates, further weighing on the company's ability to turn a profit.Taking a cue from these hypothetical lenders, Kirk is going ahead and rating Aurora Cannabis stock a "sell" itself, and predicting the shares will hit C$5 within a year. (See Aurora's price targets and analyst ratings on TipRanks)
The beverage giant’s stock has outperformed this year, despite the uncertain nature of its Asian business’s initial public offering. Guggenheim thinks that the second time is a charm, as AB InBev—owner of brands including Budweiser and Bud Light—is among other high-profile companies trying to overcome a rocky IPO process.
The cannabis group received more attention from Wall Street when a top firm initiated coverage on eight cannabis stocks. However, the analyst coverage is mixed, suggesting stock selection is critical for ...
The U.S. Food and Drug Administration on Friday issued a proposed rule for e-cigarette makers, requiring them to maintain records related to the legal marketing status of their products. When finalized, the rule would also help to ensure that e-cigarette applications by manufacturers contain information on the product's potential public health benefits and harms, the FDA said. A U.S. District Court judge in Maryland in July issued an order that would require makers of tobacco products, including e-cigarette makers, to file the applications by May 12, 2020.
Hall of Flowers has become one of the leading events in the cannabis industry, especially for B2B networking – needless to say, the Benzinga Cannabis Capital Conference remains our favorite investor-focused ...
Cannabis investing enthusiasts now have a sixth exchange traded fund to consider following the Thursday debut of the Global X Cannabis ETF (NASDAQ: POTX ). POTX tracks the Cannabis Index, making it the ...
When MKM analyst Bill Kirk initiated coverage of Aurora Cannabis (ACB) with a "sell" rating yesterday, the company's low cash reserves ($238 million) relative to debt levels ($486 million) were high on the analyst's list of concerns.Fortunately, this is not a problem that HEXO Corp (HEXO) has. Blessed with a balance sheet replete with cash ($129 million) and little debt ($23 million) to offset it, HEXO is one Canadian cannabis company where a lack of cash is not an immediate concern. Perhaps even more importantly, though, Kirk likes HEXO's business model and the prospect for the company to quickly make the tradition to a sustainable business of providing cannabis for the THC edibles market.As a result, Kirk initiates coverage on HEXO with a "buy" rating and C$12.00 price target, predicting about 130% gain for the Canadian marijuana stock in the next 12 months.HEXO, as Kirk explains, "has the best chance of creating a defensible brand" of marijuana ingredients that its consumer products partners such as Molson Coors (with which HEXO operates a joint venture) can incorporate into their products. In addition to just beer, Kirk sees HEXO providing a key ingredient in other beverages, cosmetics, and food. In furtherance of this strategy, HEXO has trademarked the phrase "Powered by HEXO" to advertise its importance in its partners' products.By making its cooperation in the creation of a product both clear and desirable to consumers (think how important seeing "Intel Inside" used to be to your choice of buying a laptop), Kirk argues that HEXO will avoid becoming just another "commoditized" marijuana producer. It could even be invited by future partners to team up, and thereby gain "early access to some exciting [marijuana product] categories."This could soon become important if, as expected, Canada legalizes the sale of "cannabis edibles" in December -- an event that Kirk describes as "Day One" of a new era for the marijuana industry. As he explains, HEXO is one half of a "two-horse field" angling to dominate the market for marijuana edibles. Giant Canopy Growth, partnered with Constellation Brands, is obviously the "horse" getting most of the attention today. But HEXO, partnered with Molson Coors, is the other half of the equation. The first company to get to market once edibles are permissible in Canada, argues Kirk, will have the best chance of building a "defensible moat" in the business.This will become even more important as marijuana production capacity ramps up over time. "Compared to Canopy, Aurora, and Tilray," you see, "HEXO has less growing" capacity -- but that's okay because simply cranking out "grams for the sake of grams" will become a losing proposition as supplies surge and marijuana prices fall. What's most important is figuring out a way to get the most money out of the marijuana you sell -- and in Kirk's estimation, HEXO's emphasis on building a brand, and making its product attractive to consumer goods partners, is the best way to do that.Visit TipRanks’ Trending Stocks page, and find out what companies Wall Street’s top analysts are looking at now.
Democratic presidential candidate Beto O’Rourke is known for voicing his opinion on federal marijuana legalization. He supports marijuana legalization.
Laura Schumacher made her first open-market purchase of stock, paying $1.8 million for shares of the biopharmaceutical firm.