Marijuana News Today
In the marijuana news today, there’s some buzz building over the future of edibles in Canada, with Quebec planning on having edibles available in winter 2019. (Source: “Montreal’s Food Industry Is Preparing To Release Marijuana Edibles To The Market Next Year,” MTL Blog, November 12, 2018.)
With the legal marijuana industry now without a major event on the horizon, the introduction of edibles to the Canadian market could be the next big thing for pot stocks.
Since its inception, the cannabis industry has been reliant on major news events to stoke hype and encourage investment bursts. We’ve seen that happen time and time again. This principle holds especially true when it comes to marijuana stock market corrections, which is what we appear to be in now.
The boom of August is now a faint memory, and the spike around legalization was strong but short and has all but been wiped away after a few weeks of pullbacks.
And that leads us to the potential of edibles.
The introduction of a new and exciting product into the Canadian marijuana market could be exactly what marijuana investors need to have their confidence restored, especially if sales are strong.
Considering that some of the first quarterly reports are being released post-legalization, and they appear to show marijuana companies with huge gains in revenue and sales, there is likely a swell of goodwill building around pot stocks that just needs a spark to set it alight.
Whether that relief comes in the form of edible marijuana or some other factor is unknown, but what is known is that the marijuana stock market correction we’re currently suffering through will likely give way to another massive rush, as we’ve seen take place before in the industry.
While many—including myself—had projected this correction to come later in the year, possibly not until 2019 even, its early arrival doesn’t change much when it comes to long-term strategy.
The cannabis stock market will rebound from this fall in value, and the reasons for that inevitable comeback are plain to see: there’s so much of the market left untapped.
Whether it’s in the form of new products like edibles or new markets like Germany and the U.S., there’s still so much room for the marijuana sector to grow that investors should not overly concern themselves with the current stock market pullback.
The marijuana news today is going to largely be subsumed tonight by Tilray Inc (NASDAQ:TLRY), since the company is set to release its quarterly report after markets close.
The first-ever quarterly report released post-legalization will be a huge chance for Tilray to prove itself.
For a long time, TLRY stock has been running on hype, using the interest generated around its initial public offering (IPO) to help propel explosive growth.
But those days are firmly behind it. Instead, it now has to earn every percentage point it gains largely on merit. This presents a new set of challenges, yes, but also an opportunity.
I’ve long been a skeptic of the long-term viability of Tilray stock. This was in large part due to the stock’s massive gains in such a short period, without the requisite foundations to back up such lofty growth.
The company’s first quarterly report post-legalization will be an excellent way for Tilray to prove wrong the doubters like myself and show that the company has something tangible to offer other than hype.
On the flip side, Tilray stock could be devastated in the market if the report is less than positive. While I see that as unlikely, it is still a very real concern.
TLRY stock traded at about even to start the day, but following the release of the earnings report, that will certainly change.
Over the past five days, we’ve seen Tilray stock pick up about seven percent, mostly due to the axing of Jeff Sessions as attorney general—prompting U.S. investors to seek out their favorite pot stock: TLRY.
With Sessions gone, the marijuana industry is safer than it has been in years in the U.S., but tonight will be the true test of whether Tilray has the numbers to justify the hype.
While Tilray offers the chance for hope and disappointment, another marijuana stock has been offering a lot of the latter recently: Aphria Inc (NYSE:APHA).
APHA stock fell in early-morning trading today by over five percent. In the past five days, the stock has lost about 15% in value.
While this isn’t totally out of step with the rest of the marijuana industry, Aphria stock has not been able to revive itself since its steep decline in the first half of 2018.
Even when other marijuana stocks were gaining, APHA stock lagged behind. I was hopeful for a long time that the stock would rebound and that long-term investors would be rewarded, but that appears to not be the case.
At this point, I’ve lost a good deal of confidence in Aphria stock. Even its recent jump to the New York Stock Exchange (NYSE) barely registered any gains, and what gains it did make were short-lived.
Overall, Aphria has a long way to go to earn my confidence back. I wouldn’t trade out of it just yet, considering the market, but I have my doubts about the future of Aphria stock.
One of the few marijuana stocks on the upswing today, OrganiGram Holdings Inc (OTCMKTS:OGRMF, CVE:OGI) climbed about three percent to start the morning.
OrganiGram stock is still down significantly over the past five days, having dropped about 15% in price. Still, the company has a lot of potential.
As a marijuana penny stock, OGRMF stock is one of the better plays during the current correction, since the volatile swings that are endemic to penny stocks are amplified by the current market conditions.
Furthermore, the company has recently scored a supply agreement with British Columbia, giving it a foothold in one of the most lucrative markets in Canada.
TLRY, APHA, and OGRMF Stock Performances
The TLRY stock (black line), APHA stock (blue line), and OGRMF stock (red line) performances from the past week are seen on the chart below:
Chart courtesy of StockCharts.com
The marijuana news today shows us exactly what we need to see: a new event that could prompt a recovery in the cannabis stock market.
While it’s unclear if edibles will be able to rescue marijuana stocks from their current downturn, an injection of excitement mixed with strong quarterly financial reports could help raise the pot stock market out of the dumps.
In the meantime, look for other ways to profit from the marijuana market correction, like using short-term strategies with some stocks and focusing on quarterly reports.