Marijuana News Today
In the marijuana news today is a bundle of stocks that are each on the rise in early-morning trading. This list includes stocks belonging to Tilray Inc (NASDAQ:TLRY), Hexo Corp (OTCMKTS:HYYDF, TSE:HEXO), and Aurora Cannabis Inc (OTCMKTS:ACBFF, TSE:ACB).
These stocks are well known to our readers by now. While some companies are struggling this week to see significant gains, these three have been consistent winners. Each brings a unique proposition to the table which sets it apart from the competition.
With that being said, let’s dive into what makes these marijuana stocks so hot right now.
Tilray Inc continues to string together a number of strong performances this week, once again climbing by about nine percent in early-morning trading.
Much of the driving force behind Tilray stock’s success is the company’s availability and visibility. By “availability,” I mean that its presence on the Nasdaq makes it a prime target for U.S. investors.
Whereas they may be wary of investing on Canadian tickers or on the over-the-counter markets, Tilray stock’s presence on the Nasdaq reassures investors that the company has indeed been vetted and approved.
The second major factor driving Tilray stock’s growth is visibility. Since TLRY stock first landed on the open market, the company has multiplied its share value many times over. The initial public offering (IPO) price of $17.00 seems a million miles away from its current lofty value of over $100.00 per share.
This massive growth in a few weeks’ time has put the company on many investors’ radars, which has created a feedback loop where the stock price only continues to rise and gain more attention.
As such, TLRY stock is one of the most exciting, volatile picks around. So far, however, that volatility has only pushed the share price in one direction: up.
“Undervalued” is not something you hear often in the pot industry. Quite the opposite, actually; charges of overvaluation are tossed out rather freely.
And that’s what makes Hexo Corp so special. HEXO stock is up an astounding 50% over the past five days, and has leaped another five points in early morning trading.
HEXO stock’s impressive run is due in large part to investment firm Riposte Capital, a large shareholder of the company that released an open letter enumerating all the ways that it believes that Hexo is actually a far more valuable company than its stock price would indicate. (Source: “U.S. shareholder presses pot firm HEXO to boost stock price or sell,” The Globe and Mail, September 6, 2018.)
Besides the fact that Hexo is one of two weed companies to have landed partnerships with “Big Alcohol” (Hexo’s coming by way of Molson Coors Brewing Co [NYSE:TAP]), Riposte made a compelling argument as to why Hexo Corp is undervalued.
The company cited the $1.0-billion supply agreement with Quebec, Canada’s second-largest province, as well as the deal with Molson mentioned above, and finally speaks on Hexo’s rather stellar financial situation.
In an industry where valuations will have to wait for some time until revenue catches up, Hexo stock has one of the strongest balance sheets around, with cash equal to more than 20% of the company’s market cap.
Riposte also mentioned that Hexo stock has some of the cheapest production costs in the industry due to its stationing in Quebec, which provides cheap energy and labor.
Listing on a major U.S. exchange would be a huge help to HEXO stock, and I largely agree with Riposte’s assessment that Hexo Corp is one of the best companies around for those looking for the most concrete value with their marijuana investment, rather than buying potential.
Aurora Cannabis Stock
The final company rounding out our list of the best marijuana stock performers this week includes Aurora Cannabis Inc.
ACB stock is up about three percent in early-morning trading as the company is still benefiting from its latest acquisition.
ICC Labs Inc (OTCMKTS:ICCLF, CVE:ICC) was the target of the latest acquisition in a deal valued at CA$290.0 million.
The expansion into the South American market via this acquisition is a strong move by Aurora. By acquiring ICC Labs, Aurora now possesses 70% of the market share in the first country in the world to fully legalize recreational pot, Uruguay. Aurora’s acquisition also has marijuana licenses in Colombia and serves as a means to establish a strong position in the South American market.
ICC Labs is also in the midst of several expansions that will see its production capacity hit 450,000 kilograms per year.
Overall, this is one of Aurora Cannabis Inc’s strongest acquisitions yet, and we’re seeing that be reflected on the stock market with an appropriate jump in value.
TLRY, HEXO & ACBFF Stock Performances
On the chart below are the recent performances of the stocks for Tilray Inc (black line), Aurora Cannabis Inc (blue line), and Hexo Corp (red line):
Chart courtesy of StockCharts.com
While we haven’t seen a massive industry run this week as we have in the recent past, the marijuana news today is still very positive for a number of heavy hitters in the industry.
These three companies are all seeing big gains for different reasons, from Hexo stock’s undervalued position to Aurora’s aggressive acquisitions to Tilray’s “industry darling” status.