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Buzz on the Bullboards: The Birth of a Cannabis Heavyweight

Stockhouse Editorial
1 Comment| May 6, 2021

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(Image via Tilray Inc.)

Healthcare stocks were some of the most viewed and best performing across the Stockhouse Bullboards have been health care, though that sector has seen some cooling off, except where a few cannabis stories are concerned.

While this trend has been shifting, what was once down is starting to rise higher. The apparent resurgence of the cannabis market has already been noted, but a surprisingly strong week for oil and gas companies has brought the energy sector back into the fold as many companies report their Q1 financial earnings.

As the largest investor hub in Canada, Stockhouse has plenty of small-cap focused users invested in the dramatic gains and losses made each week. They help us break down the seeming fall of a healthcare king and rise of two down-and-out sectors.

Sponsored by
Avicanna Expands RHO Phyto Medical Cannabis Products Into Hospital Pharmacies Through Initial Supply Agreement with Sunnybrook Hospital in Canada

The big news right now is the birth of a heavyweight in the cannabis industry, as the business combination between Leamington ON-based licensed producer Aphria Inc. (TSX: APHA, Forum) and Nanaimo, BC-based licensed producer Tilray Inc. (NASDAQ: TLRY) has been completed, creating the largest medical marijuana company in Europe and a major player in Canada’s recreational market.

With the two companies now operating as one, Aphria’s Chief Executive Officer, Irwin Simon is taking over the leadership role with the reconstituted Tilray and has also become the chairman of the new company’s board of directors.

Together this cannabis operation is one of the biggest on earth in terms of trailing-12-month revenue, along with a massive global geographic footprint that, the new company says will result in roughly $81 million in pre-tax cost synergies every year.

But what do you think? Looking at last week’s Investor Pulse Poll question on this merger, while most of you aren’t excited like a kid on Christmas over it, the number of you who say you are optimistic or uncertain brings about an air of apathy towards this combination. Once bitten, twice shy, perhaps?

We will get your thoughts on this week’s survey later on in the Buzz, for now, let’s take a look at what other small cap companies were making news over on the Bullboards ….

Therma Bright Inc. (TSX-V: THRM, Forum) has partnered with Afero, a next-generation Intelligent Edge platform to bring the its tracking technology to THRM’s COVID-19 rapid antigen screening test.

The partnership aims to bring Afero's innovation, security and tracking technology to Therma Bright's 15-minute COVID-19 rapid antigen screening test.

Once complete, the proposed agreement will offer AcuVid COVID-19 Rapid Antigen Saliva Tests powered by Afero, enhanced with encryption technology for tracking and reporting AcuVID test results.

This partnership also paves the way for preparing the AcuVID COVID-19 Rapid Antigen Test for approval for at-home testing. The MOU was completed and signed on April 28, 2021. Both parties expect to complete a definitive agreement and begin work on or before June 1st, 2021.

Therma Bright’s Chief Executive Officer, Rob Fia said that the AcuVid COVID-19 Rapid Antigen Test, powered by Afero, will provide users a “Brighter Experience” - a complete end-to-end solution to ensure product tracking, quality control and test validation data are all cryptographically captured and secured to protect individual privacy for every test taken.

“By integrating Afero's Secure QR Code technology, each AcuVid test deployed will be validated for its efficacy and confirmed on the Afero-powered mobile application. All data captured will be securely stored in the Afero Cloud. If accepted by the end user, their test results can then be transmitted to their personal healthcare practitioner, and/or to their mobile health wallet for ease of use and test verification.”

A biopharmaceutical leader in cannabinoid-based drugs, Tetra Bio-Pharma Inc. (TSX-V: TBP, Forum) announced this week that it had received authorization from the Veterinary Drugs Directorate of Health Canada to continue evaluating its veterinary ophthalmic drug, PPP-003v.

PPP-003v is Tetra's proprietary veterinary ocular formulation for treating ocular pain and inflammation in companion animals. Canine indolent corneal ulcers occur frequently in specific breeds of dogs. Corneal ulcers and non-ulcerative keratitis are among the most common painful eye disorders seen by veterinarians and if left untreated can result in pain, inflammation, scarring, and vision loss.

This study will be the first time a synthetic cannabinoid agent is used clinically in companion animals with the goal of providing pet owners with an alternative ophthalmic medication for pain and inflammatory disease.

Based on positive results from this initial proof-of-concept clinical trial, Tetra will submit a new clinical trial application to the Veterinary Drugs Directorate of Health Canada and commence regulatory filings for a New Animal Drug Application with the US Food and Drug Administration.

Datametrex AI Ltd. (TSX-V: DM, Forum) announced this week that it had filed its consolidated financial statements and related management analysis for the year 2020.

In 2020, the company recorded revenue of $12,378,024 (CAD), a 264% increase from 2019, and significantly improved its cash balance, up 1,648 per cent from 2019.

Adjusted EBITDA also improved significantly ($862,494) in 2020 compared to ($2,126,155) in 2019. This Adjusted EBITDA reflects the company's operations, not including non-cash items.

The company's AI and Tech revenue also increased to $4,101,967 from $3,369,069.

Datametrex’s Chief Executive Officer Marshall Gunter noted that the company had made significant progress in strengthening its balance sheet and positioning Datametrex for incredible market growth anticipated by shifting health policy and regulation.

“We have entered 2021 coming off a record year in revenue of $12,378,024 with most of the revenue in Q3 and Q4 related to new COVID business, providing the Company enough capital to invest and focus on increasing its revenue pipeline while continuing to promote the opportunities in both AI and the healthcare sector and leveraging the fantastic businesses that have been added to Datametrex over the last two quarters.”

What the "Buzz"

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Loop Insights Inc. (TSX-V: MTRX, Forum) announced a strategic alliance with NielsenIQ, a global leader in data analytics and consumer intelligence to transform the retail sector with automated marketing and enhanced customer engagement using real-time business intelligence. This alliance will allow brick-and-mortar retailers to adopt new, highly scalable technology and drive actionable insights to gain an advantage in a competitive retail market.

After recently announcing record Q4 2020 Revenues of $4.3 million, Kontrol Energy Corp. (CSE: KNR, Forum) stated this week that it had received final approval to list its common shares on the NEO Exchange under the trading symbol KNR at today’s market open.

Kontrol’s Chief Executive Officer, Paul Ghezzi said that the NEO shares the company’s passion for technology and innovation and provides a transparent platform for all investors.

“We are looking forward to increased exposure and visibility as well as access to a larger pool of institutional investors, both in Canada and the US.”

This week has seen a slew of earnings reports coming from energy companies around their Q1 2021 performance.

Starting with Baytex Energy Corp. (TSX: BTE, Forum), who delivered adjusted funds flow of $157 million ($0.28 per basic share), a 91% increase compared to $82 million ($0.15 per basic share) in Q4 2020. BTE generated free cash flow of $70 million ($0.13 per basic share) and production of 78,780 barrels of oil equivalent per day (boe/d) (81% oil and natural gas processing), a 12% increase over Q4 2020.

Suncor Energy Inc. (TSX: SU, Forum) who clocked in operating earnings and net earnings of $746 million and $821 million in Q1 2021, respectively, compared to losses in both areas in the previous year quarter. Overall, the company was able to strengthen its balance sheet and reduce total debt by $1.1 billion. Suncor’s total upstream production increased to 785,900 boe/d in Q1 2021, compared to 739,800 boe/d in the prior year quarter.

Lastly, we have Athabasca Oil Corporation (TSX: ATH, Forum) reported an adjusted funds flow of $19 million ($0.04 per share), along with $66 million in operating income driven by stronger oil prices and high liquids weighting (89%). On the production side, ATH generated roughly 34,400 boe/d including approximately 25,950 bbl/d in thermal oil and about 8,450 boe/d in light oil.

The company added that it had published its first is environmental, social, and corporate governance (ESG) report, noting that it had achieved a 20% reduction in green house gas emissions intensity since 2015 with a goal of a 30% reduction by 2025 by developing high quality resources and the deployment of new technology.

A phrase that is becoming more common among energy and resource companies is “ESG”, which measures the sustainability and societal impact of an investment in a company or business.

While some traders choose to cherish these criteria as a guide to help to better determine the future financial performance of companies, others see it as a fad concept designed to appeal to naïve investors, where do you stand? Let us know your thoughts by clicking the image below.

(Click image to vote.)

As this week showed, you never know what to expect when it comes to each sector’s performance, or the general market. Investors should stay as up to date as possible, and for the latest on small-cap stock movements, there is no better place than the Stockhouse Bullboards. For previous editions of Buzz on the Bullboards: click here.

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FULL DISCLOSURE: Datametrex AI Ltd. is a client of Stockhouse Publishing.

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