Overview: Sentiment and Stocks
A lot has happened since we last reported on US multi-state cannabis operator Ayr Strategies (AYR) on October 8th. Along with Biden's election win, 5 states, including New Jersey, have legalized marijuana. The good news has helped both the cannabis group generally and Ayr in particular. Ayr set a 52-week high of $29.50 on Tuesday and is up 46.7% since we last reported on it, ahead of the AdvisorShares Pure US Cannabis ETF (MSOS), up 38.8%.
When it reported Q3 results, revenue came in at US$45.5 million, up 42% from US$32.1 million in Q3 2019. At Q3 end, Ayr had 12.3 million warrants exercisable at $11.50. On November 23rd, in an effort to manage the overhang, Ayr announced a $0.50 incentive for the cash-only exercise of up to 3 million of those warrants.
Ayr is relying on acquisitions for its growth strategy with recently announced acquisitions in Arizona, Pennsylvania, and Ohio. Its most recent inroads have been in Pennsylvania where it announced an agreement to acquire CannTech PA, LLC. This follows the closing of the acquisition of licensed grower-processor DocHouse LLC on November 19th.
Ayr appears technically overbought as of Tuesday with an RSI of 87.30 and a close of $27.50 which is above its upper Bollinger band ($27.16). However, the stock's strong run has not discouraged one director who has spent US$111,416 picking up shares in the public market in the past month.