Last week in our article "
Sell WEED, for The Tax Man Cometh", we laid out our reason for going short on Canopy Growth Corporation (TWMJF) (WEED.TO) around $33 in Canada after having a very successful run going long on it in February (see our article "
Buy WEED When There Is Blood On The Streets") along with other weed stocks over the last several months. We are up to 543 followers despite not giving out a lot of alerts, a fact that we think is indicative of a diligent and prudent stock picking history. If you like our picks you can follow our blog by clicking the follow button on the top of the left hand panel.
This WEED short got to our target faster than expected and we have closed this trade in the mid-$20's. Having made money both on the long and short side on Canopy, we are looking for another
long opportunity again. We think that Canopy and weed stocks in general will not do too well for the rest of April, so we are looking for a long position in two to four weeks or if Canopy hits $22 in Canada, whichever happens first. We think that there will still be selling pressure until the end of April when tax season ends. Anyone who sold weed stocks profitably in 2017 in non-registered accounts will have a large tax bill that needs to be paid over the next couple of weeks and those people may be forced to sell stocks to fund that tax bill if they don't readily have the cash available.
We are also looking closely at reloading on Isodiol International (ISOLF) (ISOL.CN) which we picked last July in our articles
Isodiol: 10x Undervalued Cannabis Stock Inks Deals With Canopy and
Isodiol: A Profitable Cannabis Company and Newstrike Resources Ltd. Warrants (HIP.WT.CN) which we first picked in our article "
Cannabis is on the Rise Again" a couple of weeks ago. We recommend that anyone looking for weed stocks to have a look at those two positions as well as Canopy, but be patient. Put in low-ball bids but there is no sense in chasing them right now.
While weed stocks might be dead money for the next couple of weeks, there is one weed-related stock that has been undergoing significant improvements to its business but has gotten lost in the shuffle as the weed industry and the markets at large have been very shaky. That is Snipp Interactive Inc. (SNIPF) (SPN.CN). We first talked about the stock in our article "
Snipp: The Next Weed-Related Stock To Skyrocket" with four reasons why we were so bullish on it:
- A brilliant business plan to market cannabis that we believe has been overlooked by the investment community and the advertising industry. Snipp has the expertise in related regulated industries and has already attracted several companies after just releasing its platform.
- A strategic investment made by WeedMD, which has already signed up as a paying client.
- Vastly improved financial performance of its existing operations.
- A very reasonable valuation and market cap of around $30 million.
- We will add a fifth reason onto this list. In a conference call yesterday, Snipp's CEO Atul Sabharwal disclosed that the company is in talks with another LP for a revenue-generating contract. Depending on what company that is, a news release disclosing an official deal should drive a significant increase in the stock price, regardless of how hot or cold the weed industry is at that time.
We believe that all of these factors will be conducive to a huge run once the market becomes familiar with the story. Snipp has been up upon announcing the
Launch of the Cannabis Marketing Resource Center with the likes of Aphria and WeedMD already having become members:
"TORONTO, March 20, 2018 (GLOBE NEWSWIRE) -- Snipp Interactive Inc. ("Snipp" or the “Company”) (OTCQB:SNIPF) (TSX-V:SPN), a global provider of digital marketing promotions, rebates and loyalty solutions, today announced that it has received broad interest from a variety of Cannabis companies from across the spectrum of the industry including industry leaders like Aphria Inc., WeedMD Inc. and others. Over ten companies have signed up for the center since the launch just last week. The Company recently launched the Cannabis Resource Marketing Centre (“CMRC”), which brings together all of the accumulated knowledge that Snipp has acquired in designing and launching marketing programs in regulated industries, namely: Alcohol – Beer, Wine, Spirits Pharmaceuticals – Over the Counter (OTC) and Prescription Drugs Tobacco – Cigars, Cigarettes, Tobacco Arms & Ammunition – Small Arms, Guns, Bullets 3-Tier Tax Systems – Manufacturer to Distributor to Retailer The goal of the CMRC is to help Cannabis marketers hit the ground running and take advantage of the deep expertise and flexible technology platforms engineered by Snipp for these regulated industries, thereby enabling cannabis-related companies to easily launch sophisticated solutions that are legally-compliant. To sign up and qualify, the company has made available a simple application process that can be accessed at www.snipp.com/CMRC. “We are extremely excited to see so many quality companies like Aphria Inc. sign up to our CMRC and learn from the tactics that their counterparts in the Alcohol, Tobacco and Pharma companies have used for decades to drive awareness, trial, market share and retention. To succeed in what is going to be a highly competitive future, it is vital for companies in the Cannabis space to adopt and build on these best practices and not re-invent the wheel”, said Atul Sabharwal, CEO of Snipp. “Given our rich history in and knowledge acquired supporting multiple leading companies in historically regulated industries like Alcohol and Pharma, I am sure companies signing up for the CMRC will see immediate value in their membership and begin exploring deeper relationships with Snipp to enable their marketing objectives. Today we service multiple leaders including many Fortune 500 brands in Alcohol, Tobacco and Pharma because of our secure, flexible and scalable technology platform that enables a multitude of program types, to solve a diverse set of problems for these clients. We welcome qualified companies to join and explore our resource center and engage with us in a deeper conversation to help drive their business objectives.” We think that this is a brilliant business plan set up by Snipp and that it has the expertise needed in regulated industries like alcohol and tobacco as well as pharmaceuticals to help set up marketing programs for the growers and distributors of medical or recreational cannabis. Whatever Snipp is offering, it is enticing enough to have had over ten companies sign up in a week. We expect that to grow and for Snipp to take every opportunity to announce a big company signing up for the program like it already has with Aphria. If you are a bull in the cannabis industry, there is no question that you should take a look into Snipp as well. There are many LPs out there, but only a handful of agencies that can set up appropriate marketing campaigns for them. The industry will need both. We expect this process to be relatively turnkey as well. A template that will work for one grower or distributor will work quite well for all of them.
WeedMD announced a strategic investment in Snipp in late March:
Read more:
https://nasdaqnewsreports.blogspot.ca/2018/04/closed-off-weed-short.html