You are reading this week’s edition of New Cannabis Ventures, a weekly magazine we have published since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve, as well as links to the most important news of the week. We no longer email them like we used to, but post this and all newsletters on our website here.
friends,
Cannabis was legalized seven years ago. Congress didn’t know exactly what it was doing at the time, but it seemed like a good thing at the time: the Farm Act of 2018. From an investor perspective, there wasn’t much excitement, although there were a few CBD-focused companies enjoying this change. These stocks did well initially, but have fallen and are all small companies that should not be publicly traded.
There have been several challenges. CBD has a good perception among consumers, and the benefits go beyond proven health problems such as treating epilepsy (Jazz Pharma, which bought GW Pharma a few years ago, sold more than $300 million of Epidiolex in Q3). Many people use CBD for many reasons, but the FDA is not involved because it is it is extremely difficult to figure out how to manage the setting about it and asked Congress for help in early 2023.
The federal government’s failure to properly regulate CBD is only part of the problem. The law was poorly written, and companies figured out ways to develop other cannabinoids, including THCA, from hemp. No one was talking about this after the Farm Act was passed, but sales of other products outside of CBD have increased due to the development of technology as well as synthetics. The hemp cannabinoid industry is booming but remains unregulated. Many states have legalized cannabis for medical use, and many have implemented adult-use programs. Unlike manufacturers and sellers of cannabis products, companies that are part of state regulated programs face a much higher level of regulation. They also face 280E taxation.
Discussed this newsletter about fourteen months ago threat and opportunity with cannabis. At the time, no major cannabis companies were involved in cannabis, but that quickly changed as the three largest MSOs all got involved. Curaleaf took one of its Florida medical cannabis dispensaries and turned it into a cannabis store. It also manufactures hemp-based products. Trulieve launched a THC beverage business, and Green Thumb Industries worked with a company that was acquired by publicly traded Agrify. Agrify became RYTHM, Inc., which is controlled by GTI. None of these companies provide much in terms of revenue or even details on the number of units sold. Canadian LPs Canopy Growth, Organigram and Tilray Brands sell THC drinks in the US
This week, another MSO, MariMed, announced it is entering the cannabis market. Glass House Brands, which established a relationship with UC Berkeley, may also enter the industry.
In that August 2024 segment, I suggested that there are good reasons for state-regulated cannabis companies to step out of their comfort zone. The hemp industry remains unregulated by the federal government, so there are potential risks that the federal government will make some changes that will make it more difficult for operators. I would like it to be properly regulated. There are too many unregulated sellers and manufacturers selling bad products to consumers. Many states are cracking down on the hemp industry as well.
One MSO, Jushi Holdings, has filed lawsuits against retailers in Pennsylvania and Virginia for failing to properly follow THC hemp laws in those states. This is not the only sign of war, as many decry the impact of hemp-based cannabinoids on the revenues of state-regulated hemp companies.
This fight is bad for carriers, but it’s also bad for consumers, in my opinion. How this plays out is very uncertain, but hopefully the federal government will be more rational about hemp products. Consumers deserve safe products that are easy to understand and that are available in restaurants and stores.
Sincerely,
Alan:
New Cannabis Ventures publishes curated articles as well as exclusive news. Here is what we published last week.
Based in Houston, Alan leverages his experience as an online community founder 420 Investorthe first and still the largest due diligence platform focused on publicly traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. time New Cannabis Ventureshe is responsible for content development and strategic alliances. Before turning his attention to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst with more than two decades of research and portfolio management experience. A prolific writer, with over 650 articles published since 2007 Looking for Alphawhere he has 70,000 followers, Alan is a frequent speaker at industry conferences and frequent source Media including the NY Times, Wall Street Journal, Fox Business and Bloomberg TV. Contact Alan. Twitter: |: Facebook |: LinkedIn: |: El
You are reading this week’s edition of New Cannabis Ventures, a weekly magazine we have published since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve, as well as links to the most important news of the week. We no longer email them like we used to, but post this and all newsletters on our website here.
friends,
Fifteen weeks ago we pointed it out few investors care about Vireo Growthand it remains so. Vireo Growth (VREOF) has declined significantly in 2026 and is near its lows. Here is what it and MSOS have done since the 2024 election.
Vireo did a reverse split on June 5, issuing 1 new share for every 30 shares previously outstanding. Dividing the current price by 30 allows investors to judge the performance of equity sales at the end of 2024. It was a big capital raise when the company sold shares at $0.625 for $81 million in proceeds. The current price of $9.44 is well below this level.
The company, as we discussed before, has done so much. Since that last article, it announced the acquisition of Planet 13 (PLNH) and announced that it is acquiring certain assets of The Cannabist Company. It also shut down a Pennsylvania dispensary, PhytoNatural, its entry into the state. In June, it completed the purchase of Bridgewell Agribusiness, expanding its ancillary operations and announced dispensary acquisitions in Maryland and Nevada. It also agreed to buy C21 Investments (CXXIF).
In addition to the capital it recently raised in 2024, Vireo has relied on Chicago Atlantic (REFI), which will soon merge with Chicago Atlantic BDC (LIEN). Vireo’s CEO joined from Chicago Atlantic in late 2024.
So Vireo continues to do a lot of M&A, both in private and public companies. Investors continue to be impressed, in my opinion. The average trading value in VREOF for the last month was only 13 thousand shares per day. Stocks are down, and so are acquired companies.
Recent investors aren’t happy, but Vireo Growth’s pool of disgruntled owners runs very deep, as the company issued a lot of stock as part of its M&A. Perhaps more importantly, Chicago Atlantic’s stock is collapsing.
This further decline in Vireo Growth is a big red flag for hemp stocks.
Sincerely,
Alan:
This week’s newsletter is sponsored by the Paul E. Saperstein Co.
Michigan cannabis service provider
On August 17, Common C Holdings, LP’s commercial specialty hemp processing facility will be auctioned at 607 Wildwood Avenue in Jackson, Michigan and online at 11:00 a.m. ET. Learn more Of the secured party’s sale of all assets of this cultivation equipment.
Interested parties may contact Paul Cotto at 617-227-6553 or email pcotto@pesco.com:.
New Cannabis Ventures has not published any curated articles or exclusive news.
Based in Houston, Alan leverages his experience as an online community founder 420 Investorthe first and still the largest due diligence platform focused on publicly traded hemp industry stocks. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. time New Cannabis Ventureshe is responsible for content development and strategic alliances. Before turning his attention to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst with more than two decades of research and portfolio management experience. A prolific writer, with over 650 articles published since 2007 Looking for Alphawhere he has 70,000 followers, Alan is a frequent speaker at industry conferences and frequent source Media including the NY Times, Wall Street Journal, Fox Business and Bloomberg TV. Contact Alan. Twitter: |: Facebook |: LinkedIn: |: El
You are reading this week’s edition of New Cannabis Ventures, a weekly magazine we have published since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve, as well as links to the most important news of the week. We no longer email them like we used to, but post this and all newsletters on our website here.
friends,
Many more cannabis companies reported Q1 financials this week. While NCV did not run any of those press releases, all data has been updated in the New Cannabis Ventures Public Cannabis Company Revenue & Income Tracker. The largest companies reporting in US dollars all reported, and the eleven companies that reported for the Q1 ended in March (excluding Tilray Brands, which is due to report its Q4 later this month) saw an average year-over-year revenue increase of 31% in their cannabis businesses.
Excluding Vireo Growth, that average comes to -0.7%, which is lower, especially after accounting for inflation, and a sign of continued challenges for the hemp industry. Speaking of Vireo, I’ve pointed out how investors didn’t care, and they still don’t. An average of just 375,000 shares traded per day over the past month, and the stock, which closed at $0.415, continues to trade off the level of its late 2024 capital raise and the price at which the company issued shares to make multiple acquisitions.
April was a big month for hemp stocks, but prices fell in May. The NCV Global Cannabis Stock Index rose 8.8% to 5.70 in April, but fell 2.8% to 5.54 in May. The year-to-year change of this index, which now covers 23 stocks, was -15.9%. Since its peak in early 2021, the GCSI is down 94%. Many are excited about the medical cannabis realignment that took place in April, although it remains unclear whether cannabis will be completely overhauled. The Department of Justice will hold hearings in late June to discuss adult-use cannabis, and it could be. If so, 280E tax would be removed, and this would be very good. I’ve written a lot about this since late 2022 when I highlighted it The potential end of 280E as a major catalyst.
The investor base in cannabis stocks has shrunk due to capital losses and fewer people interested in the sector. Institutions were more interested in high prices and maybe they would enter the field. 280E remains a big story, and not only is it being delayed by the limited realignment that’s already been completed, it’s unclear how unpaid taxes from the last few years will be treated.
NCV has stopped publishing most cannabis news, although we continue to update the financial calendar as well as the earnings rankings. After more than 10 years with NCV and more than a dozen years with 420 Investor, I am in the process of moving on. This is probably the last weekly newsletter. I’ve appreciated sharing the news and my views here, and I want to wish everyone the best. Hopefully, 280E taxation will be fully completed and the bear market that began in early 2021 for the hemp sector will be over.
Stay on top of the most important communications from public companies by watching what’s coming cannabis investor calendar.
Based in Houston, Alan leverages his experience as an online community founder 420 Investorthe first and still the largest due diligence platform focused on publicly traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. time New Cannabis Ventureshe is responsible for content development and strategic alliances. Before turning his attention to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst with more than two decades of research and portfolio management experience. A prolific writer, with over 650 articles published since 2007 Looking for Alphawhere he has 70,000 followers, Alan is a frequent speaker at industry conferences and frequent source Media including the NY Times, Wall Street Journal, Fox Business and Bloomberg TV. Contact Alan. Twitter: |: Facebook |: LinkedIn: |: El
Michigan April hemp sale decreased compared to a year ago, as they increased sequentially by 1.2%. At $258.6 million, sales decreased by 4.3 percent compared to last year.
Michigan’s cannabis regulatory agency breaks down sales by medical and adult use, with medical sales down 24.1% year-over-year to $0.4 million, down 5.6% sequentially, and adult-use sales down 4.3% year-over-year to $255.5 million, despite a one-day increase of 1.2% in March.
The state breaks down sales by category and provides pricing details by category for both medical and adult;
For Adults – UseMedical
As supply continues to expand, adult flower prices have fallen sharply, although the decline is slowing. April’s average price of $945 per pound fell 4.2% sequentially to just above December’s record low and down 5.1% from a year ago.
Michigan hemp sales are expected to grow 82.1% to $1.79 billion in 2021, 27.9% to $2.29 billion in 2022, and 33.3% to $3.06 billion in 2023. billion In 2026, Michigan cannabis sales decreased by 5.9%.
Based in Houston, Alan leverages his experience as an online community founder 420 Investorthe first and still the largest due diligence platform focused on publicly traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. time New Cannabis Ventureshe is responsible for content development and strategic alliances. Before turning his attention to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst with more than two decades of research and portfolio management experience. A prolific writer, with over 650 articles published since 2007 Looking for Alphawhere he has 70,000 followers, Alan is a frequent speaker at industry conferences and frequent source Media including the NY Times, Wall Street Journal, Fox Business and Bloomberg TV. Contact Alan. Twitter: |: Facebook |: LinkedIn: |: El