It’s been a little over a year since the formation of the great Canadian wave of marijuana investment opportunities, and in that time we’ve seen several waves come and go.
There was the ‘OMG every company in the world is up 3000% because they’re looking at weed’ phase, shortly followed by the ‘screw marijuana, Health Canada is going to mess everyone up’ phase, and then the ‘why aren’t the growers so rich they’re plunging their faces in giant piles of cocaine’ phase.
Today? This is the ‘what are you going to do with all that cheap weed’ phase.
And so, with every marginally employed (or less) person in North America currently sitting in a park celebrating 4/20 by getting shittered, I’m joining the fray by releasing my annual MMJ investment power rankings.
These rankings are not in order of how big a company is, nor in order of how heavily their share price is jumping, nor even how big they might get somewhere down the line. They’re based on one single metric; how heavily I feel like I’m missing out if I don’t own some, right at this moment in time.
For the sake of simplicity, we’re focused on Canadian listings. Also because the OTC weedco space is a big pumpy dumpy mess.
Before we get into it, for the first time, I’m going to include your own (educated) opinions in the rankings. That’s right, I’m going to allow you, the reader, to argue that your favourites should move up the ladder, for 24 hours after I post my piece, in the comments.
Call me biased, call me stupid, call me Sandra – it’s open season. Defend your picks, attack others, be as Bullboardy as you wanna be, and the best arguments (that is: smartest and most insightful) will be rewarded with my making a late adjustment to the table accordingly.
Alternately, if you’re all fools and douchenozzles, I’ll leave things as they stand. Sadly, the over/under on that is alarmingly high.
So let’s get on with it. Here, from the bottom up, is my top 20 MMJ power rankings.
20. Cannigistics Agri-Solutions (CSE:V.CYX, Stock Forum): Formerly, Calyx Bio-Ventures, now
divested of their own-time carinata-to-jet-fuel project, Cannigizz is hunkered down and focused on its weedco services arm, which is building out what it says is a one-size-fits-all MMJ software integrator. No more will dot.bong companies have a dozen different systems for security, document management, compliance etc, working in silos, not talking to one another. Cannigistics brings them all into one dashboard, which is necessary work, even if not a lot of their potential clients know it yet. A recent MOU to incorporate a
clinical trials platform into their suite of services is a big plus. A low price, entry level stock with a strong blue sky element, designed for recurring revs, but you’ve got a little time before this price point disappears.
19. Matica* (CSE:C.MMJ, Stock Forum): The entire ‘we’re gonna get a license soon’ sector in the Canadian markets is pretty beaten down, and C.MMJ is no exception. Thay’ve just taken delivery of their
HVAC system and finished their security fence after some snow delays, so this little Nova Scotia grower is hitting the ‘wait for final inspection’ period with the stock low and long holders aching for the $0.14 February high. Got a great deal on their grow facility and just announced a research deal that won’t hurt long term potential at all, and US trading is coming. Like Supreme, if you daytrade this one you’re doing it wrong. Uber cheap buy and hold and a dominator in its niche.
18. Canadian Bioceuticals (TSX:V.BCC, Stock Forum): Not a company that has really put runs on the board yet, but with new management has found itself
suddenly right in the middle of a hot sector that it is ideally suited to front run. A&M target, in my opinion. Low volume means big upward potential on news and there is most assuredly news ahead.
17. Aurora* (CSE:C.ACB, Stock Forum): Formerly Prescient Mining, Aurora surprised everyone (itself included) when they were suddenly given their MMPR. Full speed ahead into production now, with what I’m told by several non-insiders is Canada’s most impressive facility. Borrowing money to get there instead of diluting, which is good because there are a lot of shares out.. Stock price has drifted but showing signs of life. Might be a quarter before this is ready to pound again.
16. True Leaf Medicine (CSE:C.MJ, Stock Forum): When the CEO of True Leaf announced the company would be weed-bound, a lot of people said ‘why would a pet food CEO start a weed business?’ Fair question, and it’s just been answered. While waiting for their MMPR project to move forward, True Leaf is making moves in the
hemp pet food supplements space that, frankly, are way more advanced than you might think. If 30% of people in North America have a dog in the house, then 30% of all MMJ patients fully understand how CBDs could help their pets. Massive market, but True Leaf needs to show the market they’re serious. Expect that soon.
15. T-Bird Pharma (TSX:V.TPI, Stock Forum): For a lot of months I told readers that there was something brewing at TPI, and for a lot of months they didn’t listen. Fair call, for a while anyway, but this company put the afterburners on in late February, jumping from $0.385 to $0.66 on news they were bringing in significant heavy hitters to develop the business. Has since fallen back to the $0.50 range where it appears to have firmed. Wouldn’t be shocked to see that license be the first one to be acquired by another LP.
14. Aphria* (TSX:V.APH, Stock Forum): The quiet achiever in the grow space, Aphria has announced two
patient referral deals and their
first two wholesale shipments, and their stock price is moving in absolutely the right direction. In fact, compared to other growers, Aphria is showing good returns for shareholders.
13. Bedrocan* (TSX:V.BED, Stock Forum): A company that sometimes almost feels ashamed to be on the public markets, Bedrocan management likes to quietly churn away at their big picture outlook of becoming the next big Canada-to-NASDAQ graduate. Whenever a national government looks like it’ll liberalise marijuana regulations, Bedrocan will be there with its food in the door, advising regulators and avoiding any activity that may associate them with the usual medical marijuana clown car. That’s a positive over the long haul, but investors would sure love it if the company dropped some news now and then. The flattest share chart in the business does nothing for daytraders or long holders.
12. Worldwide Marijuana (CSE:C.WWM, Stock Forum): Came out of the gates without news after a long halt and, though holders gave it a week or so, management has watched a prolonged sell-off take place in the time since, leading to a $0.10 floor. Hang tight, long holders: You can’t get Commander Bob on the phone right now because he’s traveling all over hell’s half acre,
working on deals both sides of the border. Once he comes back ashore, I’d except to see some news activity that will make today’s $0.09 price a really nice average down point. Tight share structure, increasing volume; the ball’s in Bob’s court.
11. Grenadier Resources* (CSE:C.GAD, Stock Forum): Never heard of them? I hadn’t either, until last Friday when I walked into their offices and said, “
What’s all this about you guys doing a deal with Naturally Splendid for hemp protein?” What followed was a half hour that impressed the hell out of me. Big MLM names developing a brand of drinks and coffees that will give you your morning protein shot while you’re getting your morning caffeine shot. If I’d read a press release about it, I might have shrugged and moved on because hemp drinks are generally pretty blurgh, but after tasting the early version prototypes, I’m buying the stuff for my kitchen as soon as it hits the market. Halted at $0.30 – watch for news. No bullshit with this one, and a nice backdoor NSP play.
10. Tweed* (TSX:V.TWD, Stock Forum): They’ve taken body blows from everyone in the business, been subject to a lot of rumour and a lot of that rumour has been absolutely correct. They’re first movers, big fish, pioneers and screw-ups (and
April Fools Day practitioners) but, bottom line; The stock has found itself a nice $2 p/share, $100m market cap base, and successfully bought itself out of a lot of trouble. Now, with a bunch of dough recently raised, the rumour mill is rolling again, this time suggesting Tweed is in line to buy out a competitor. If that happens, this stock roars and the market lifts overnight. Forget revenues; I’m hearing a lot of talk that Tweed is an aggregation play moving forward.
9. Organigram (TSX:V.OGI, Stock Forum): Formerly my number one pick in the space, but there’s nothing particularly wrong with Organigram, it’s just that it went quiet for a spell and that hurt early investors. Share chart is a total ski jump, but the recent uptick is fueling takeover speculation. Worth a buy at this price even without the takeover talk due to
increased patient numbers and
license capacity.
PTSD referral deal has real legs. Doing what they said they’d do.
8. Wildflower (CSE:C.SUN, Stock Forum): Yeah yeah, I know I’m going to take heat for putting Wildflower above the big growers but, just to repeat, this list is based on what I feel like I should own most, right now, and Wildflower has (love it or hate it) generated a
400% increase over the past two months, which dominates the value-add space. Recent licensing deals with US-based
edibles and
e-Juice product developers have lined up real revenues going forward. MMPR license applications are in, but the market almost doesn’t care about those anymore. The value-add diversification move has been a great one. Is there are more juice left in the Wildflower deaflow? If so, the current $0.26 base will be a nice launchpad.
7. Supreme Pharmaceuticals (CSE:C.SL, Stock Forum): Stuck in the limbo of Health Canada’s MMPR inspection backlog, Supreme has seen its share price deplete while it waited, waited, waited… That served smart traders well a few weeks back when some of us (myself included) jumped on a ridiculous $0.165 per share, riding that up to $0.24 in just a few days. The big knock on C.SL was that it was low on cash and likely to lose staff while waiting for the green light. A
recent debenture raise of $1m+ takes that potential speed bump off the table. Now? Cashed up until deep 2016, and if the license pops tomorrow, they’ve got the funding needed to get started quickly. If it gets down near that $0.16 again, jump all over it, because a license takes this to a double - minimum.
6. InMed Pharmaceuticals (CSE:C.IN, Stock Forum): When I missed the $0.13-to-$0.37 ride, I vowed never again to let daily ups and downs influence my holdings in this biotech seedling. When it drops, I buy. When it jumps, I hold. Why? Two reasons. First, there’s increasing buzz that a deal with a larger biotech company is in the works. GW Pharma perhaps? Second, even if there’s no deal out there, the brainstrust driving this project are straight up beasts in the Canadian bio-science space, and
Health Canada appears to agree. Negligible burn rate, growing collection of pharma IP, and one halfway decent deal away from never seeing sub-$1 prices again. The only way I get out of this stock is if I’m bought out, or I die. Or I date a stripper and have child support due and she REALLY likes that necklace and.. well, you know what I’m talking about, right Vancouver brokers?
5. Invictus MD Strategies (CSE:C.IMH, Stock Forum): Get familiar with this one because it’s tooling up. A straight up aggregation play that is helmed by Dan Kriznic, who left a heavy hitting position at Deloitte that would have kept him in the 1% forever to start up his own weed investment empire from the ground up. Unlike the Abattis strategy, Invictus is investing in real companies. Unlike the Pharmacan strategy, it isn’t anchored in grow plays. Unlike the Enertopia strategy, it’s adding value to its acquisitions. Consider this: Invictus raised $400k in December for acquisitions. Since then, it has made three and still has $100k left.
And those acquisitionsare atreally nice prices, with an
option to acquire more at the
same rate down the line. Former Supreme exec
Brayden Sutton just locked in as VP of Business Dev. Volume cranking up. Share price rolling forward. This is your moment.
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4. Nutritional High (CSE:C.NHL, Stock Forum):Dominated the junior markets in trading volume when it landed a few weeks back, fresh with a full prospectus, and though that volume has since slowed and the price firmed at $0.10 (a 100% profit for the founder round folk), the oncoming US listing is destined to jump things shortly. The company is doing everything right by shareholders; a new
deal with a licensed New Mexico grower opens that state up as they continue their moves in Colorado and Illinois with a view to launching a mass produced, high quality edibles line. Investors love the value-add space, and C.NHL provides a strong entry point with room to grow.
3. Golden Leaf (???)*: Management came through Vancouver a few weeks ago on a roadshow tour and made some significant friends along the way. Cannabis oil extraction play out of Oregon that wants the legitimacy of a Canadian listing and did between $350k and $400k per month up to January, $417k in February, and $700k in March when their second extractor came online. A third is due next month and they project they’ll have 8 or more machines mid-2016. Any LP that showed $700k monthly revenues would be instantly jacking their market cap to Tweed territory, and any company with that sort of hockey stick growth would be chased by investors like your grandmother chased the Beatles. Listing audit should be complete mid-May, Dundee is walking them into their debut at $1 per share with 50m outstanding, or so I’m led to believe. That’s a little aggressive, for mine, but if they continue that growth spurt, it’ll be entirely justified and with their own dispensary added to the mix, they should do just that.
2. Naturally Splendid (TSX:V.NSP, Stock Forum): In my top 5 all of last year and that faith was entirely justified when it came screaming out of an extended trade halt to a 400% increase over two months. Took a $0.30 hit when a
recent PO news release was misinterpreted as the only purchase order on the horizon, but that serves as a nice re-entry point to anyone who took profits near $1. Hemp omega technology now being sold to potential partners/customers has potential to be used for
extracting the CBDs out of industrial hemp and replacing the need for medical marijuana. That’s the blue sky; the now is a boatload of deals coming to utilise their water soluble hemp omega in a wide array of foods, drinks, pet medications, cosmetics… amassed a who’s who of directors and advisors such as the former
President of Maple Leaf Foods, and the folks who built
Clearly Canadian,
Mona Vie and more into global brands. Serious people building
something massive. Buy it and forget it. I did.
1. Kariana (CSE:C.KAA, Stock Forum): This is the stock that Canadian brokers are literally sweating on. Not because they’re unsure of its success, but because demand is so intense that depriving ones best clients of a piece of the private placement is being seen as tantamount to treason. Only $750k will be taken on what was supposed to be a $500k raise, but broker David Kearnes’ book on this stretches deep into the $7m range, and could have been much more if the KAA crew weren’t flat out telling potential investors “NO!” rather than taking their details. What’s all the fuss about? CannaStrips, a product that is being licensed around to dispensaries and growers around North America as it delivers THC and CBDs to users through an edible strip similar to the ones used by Listerine for breath mints. Exact dosage is key, margins are heavy, they’re not handling any weed so regulators aren’t an issue, the team are some of the same folks behind WeedMaps which is a massive moneymaker, and significant revenues are being booked right now, so this will likely be the last raise the company ever goes through. Bids are already at $0.50 on a $0.16 halted stock. Likely to hit the markets any day now, just finalizing the paperwork.
The ‘wouldn’t hit with a barge pole’ crowd:
Creative Edge* (OTO:FITX, Stock Forum): Total pump and dump, and in the dying phase of the dumpage. Unbelievable that with so much evidence of wrongdoing the SEC hasn’t halted the stock, but the OSC has it under investigation currently, an astonishing situation being as it doesn’t operate under OSC jurisidiction. Sub-penny, down from $0.10 last year. Still over-priced.
Green and Hill Enterprises* (OTO:GHIL, Stock Forum): CEO Ross Rebagliati held a social media contest this week with the winner given an hour to hang out with Ross and his crew after the 420 Toronto rally. And that may be the corporate highlight for this company for 2015.
Kaneh Bosm* (CSE:C.KBB, Stock Forum): It sounds like these guys are sitting on a deal to bring a whizbang awesome Italian vending machine to the weed space in North America. That’s great but, right now, still illegal just about everywhere. They also want to consult with growers building their facilities. That’s great but, right now, not a business I see as particularly scalable. They’re also doing a <$100k raise. That’s great but, so am I; it’s called a credit card. Show me something, KBB.
Abattis Bioceuticals* (CSE:C.ATT, Stock Forum): A lot of work being done to rehab this once great looking mess of LOIs, consulting deals and non-businesses. I’ve been beating on it pretty heavily for the last few months as Maserati Mike took a sideways step and plans emerged to spin off a unit to Uruguay. You’ve got to deliver on your promises in this business, and Abattis hasn’t done that. At all. Show me something, Rene.
Satori (TSX:V.BUD, Stock Forum): I own some stock in this, I think, but it’s worth so little right now I’d get more monetary value recycling the share certificate as single-ply. Yes, there’s a gold play in the middle of this that’s certainly worth something, but I get the sense management wants to keep it for old times sake. And yeah, there’s a weed-friendly ticker symbol that could be auctioned off, but it hasn’t been yet and the allure of a Venture listing for weed plays has rapidly dwindled. And yeah, there are some good people nearby who could develop a strong weed product but need the board to really get behind them, and they haven’t yet. A recent RTO went sideways when the people behind the deal turned out to be certifiable, and not in a good way.
Enertopia* (CSE:C.TOP, Stock Forum): Remember when this was a thing?
--Chris Parry
https://www.twitter.com/chrisparry
FULL DISCLOSURE: As Stockhouse has been a market leader in coverage of the medical marijuana market over the last year, a vast array of the companies mentioned above have marketing programs with Stockhouse Publishing, while others are held as an investment by the author of the piece, and others have engaged with the author’s consulting firm. Others still are held by Stockhouse ownership.
All companies mentioned in this piece that do not feature an asterisk (*) next to their name fit into one of the above categories and, as such, you should do your own due diligence before investing in any of them.
Companies with an asterisk by their name have no commercial arrangement with Stockhouse, its ownership, or the author. No company has paid for mention in this article.