Marijuana is still relatively new on the blockbecause of the indecision of those charged with legalizing it.
If you believe, like I do, that the stockmarket is just a harbinger of things to come, I am seeing more corrections as companies take action for what they see coming.
When high interest rates lead to lost homes compounded by layoffs of workers, that takes time to work its way through the system.
There is also inflation by lack of supply and greedflation for those that just think they can demand more because the herd is fearful. One of the biggest causes is energy players who are the silver lining in the cloud of despair right now. Higher energy costs lead to higher everything costs and the fact that employment is at all time lows and jobs available at all times high suggests that the covid top-ups were well received by everybody who liked the paid holiday and had enough money in their pocket that they don't want to go back to work.
Launching a whole new vice has lots of interest and investors who got overly enthusiastic, probably because of the phenomenal sp hikes achieved by lps like Canopy, Tilray, Trulieve and others who achieved phenomenal multi-baggers that are rare in the investment world.
The result is too many players, too much product and a lack of desire by politicians to shut down the black market.
In Canada we got a cheap, safe supply of weed for consumers. So cheap in fact, that none of the processors are making satisfactory money or at least enough to keep the investment community interested.
The US is in worse shape, i believe, because their black market is thriving to the detriment of those players who are trying to bring value added, safe products that can actually generate tax revenue while the black market stuff is too competitive and doesn't like to pay tax.
I beleive that the potential is too high for those that will be the winners of this market and they won't quit until everything plays out and the riff-raff is gone.
Canopy thought big initially and their coup was when they garnered $5 billion C from Constellation for a piece of the action.
This was done at peak times where everybody was getting irrational sharevalue for their stock certificates. Constellation did this purchase to be a part of where they figured this industry was headed which was their marketshare for soft alcohol beverages with Canopy formulating a new vice, similar to alcohol for a buzz factor that also offered a lot less calories and a lot less sugar because of the thc.
A lot of work went into tweaking those thc infused beverages for fast on and off effect to be similar to the way alcohol works, timewise.
Along the way Constellation did their homework and picked up several other deals with like minded companies on US soil to be able to market and profit from their brands that were showing good returns.
The big picture now is Canopy bringing the best of their wares and IP to all of the several companies that Constellation found of interest for a spoke and hub company that encompasses all of them, together to be the leader of the US pot industry when the legal persecution and prosecution is dimi nished to support a whole new legal vice as well as medical value that consumers are finding on their own, mostly veterans, I think but also others.
Beverages and pharma skus have been high margin, high turnover skus forever and Constellation has had huge success with beverages and are bringing that success and expertise to cannabis and hemp.
They have laid the groundwork for a market where they sense they can be successful but also are active Internationally in about a dozen countries in the event that the US focks this up like Canada has done, which resulted in them picking up stakes and moving to the US.
The US is going to get roughed up a lot as investors feel the pain of government policy to curb inflation and get everybody back to work and this new vice that is being ram-rodded by Constellation is coming into its time.
This could be the silver lining in the cloud of despair that helps to lead the US out of the recession that is darkening the sunshine to restore confidence in their markets.
This could be the golden opportunity for those that have the time to wait this out until the policymakers fix it to level the playing field with beverage alcohol and all of the investment tools that they are privy to like banking, borrowing, brokering and a safe supply of marijuana skus that most consumers are familiar with and will consume when legal and safe.
glta and dyodd