Post by
mrmomo on May 27, 2022 12:19pm
Final thoughts
No one should be surprised of what happened here this week & on how things would eventually end up. Every premonition, fortune teller, crystal ball, Oracle, prophecy, foresight, mathematical statistical probability, including Nostradamus himself & and every gut feeling you ever had, all had precited this very same thing since the peak of 2019. Like i did so acurately as well. So let this NOT be a surprise to no one.
So where do things go from here? Since this is May 2022, and i had expected (by my predictions in 2019) the third and final wave of consolidation & culling of the herd to be more or less done by this time. Unfortunately though, it seems we arent not even close to that end. By my estimations, we're still at the mid point of wave 2 and still more pain to come for all involved. Why are we still in this difficult but natural process and why is the industry is so slow to adapting, having trouble to properly organize?
Aside from the obvious fact of the lack of critical legislation being implemented & moving forward, the stubborness or ignorance of many weaker players in the industry to go t'OOts up, disappear completely or merge/sellout into their stonger peers is the main culprit. Just too many useless people around in a tight, limited space and not enough breathable oxygen or resources available for everyone. So ALL suffer, even the best & most resilient. So until that changes, EVERYTHING, ASSOCIATED or INVOLVED with the cannabis industry will be in constant pain to all.
I follow about 30 major players with a MC of ~$100M, that's apart from the additional 100 or so smaller outfits, most of who are complete limbo or near BK. UNTIL those numbers are greatly reduced, which means maybe a handfull of major players, about a dozen not more, AND ALL the smaller (under $100 mc) worthless players who are just taking up space, using up valuable oxygen and basically doing nothing go completely under, nothing will change. In fact, the longer these phonies or pretenders stick around, the more damage they will do the industry and the more irrecovable harm they will inflict on the best of them.
As for Canopy itself, they could possibly, theoretically still make it out of WAVE 2 in one piece, BUT they must really make some massive changes in their operations. Beginning with restructuring/eliminating their huge debt load, massively reducing costs, downsizing ops with layoffs and streamlining all operations from top to bottom. With only $550us in cash and maybe another $200m in liquid investments, that combined with current burn rates, their time & options are running out. At one point if nothing is done or sufficient, it will be a point of NO return.
In the end, whether it is Canopy or anyone else in the industry, for investors looking to invest in this space thinking its a bargain (again!), i highly recommend that you do NOT......just yet. This is still WAVE 2, with no clear course for the industry or adequate legislation to pave the way and still lots of pain to come. Probably the worst of it for shareholders will show itself in the early part of WAVE 3 around sometime in 2023 or mid 2024. For now, my advice is stay out of it completely until things sort themsleves out and we can at least see who the likely winers will be. For those asking or wondering if Canopy could be one, well, anything is possible, as god works in mysterious ways and miracles do happen. But right now, Canopy is a badly wounded horse who's taken a big blow to its front leg, is falling behind in this crazy dangerous horse race and about to stumble before the finish line. And there are those who are already calling for Canopy to be carted off the glue factory even before its time.
GLTA