Marijuana News Today
The marijuana news today has us seeing pot stocks generally trend upward as we see the largest acquisition between two U.S. cannabis companies.
The acquisition in question will see Curaleaf Holdings Inc (OTCMKTS:CURLF, CNSX:CURA) buy Cura Partners Inc. in a stock deal valued at $950.0 million. (Source: “Curaleaf Bets Nearly $1 Billion on Weed Oil in U.S. Pot Deal,” Bloomberg, May 1, 2019.)
Curaleaf was already the largest U.S. marijuana company by market cap and this move will likely maintain the company’s dominance in that regard.
Based in Massachusetts, Curaleaf Holdings is looking to expand its cannabidiol (CBD) business with its buy of Cura Partners, a Portland, Oregon-based company that makes oil for vape pens.
Cura Partners has a presence in more than 900 dispensaries, including in California. Last year, the company registered revenue of about $117.0 million. (Source: Ibid.)
Curaleaf Holdings, by contrast, has 44 dispensaries in 12 states and recently announced that it would start selling CBD products.
The acquisition is going to have a huge impact on CURLF stock, but it is also telling for the U.S. cannabis market as a whole.
Since the Agriculture Improvement Act of 2018 passed (allowing for the cultivation of hemp), CBD oil has pretty much been totally legal across the United States. This means we’re seeing the first glimpse of a U.S. cannabis market, only without marijuana products.
Many Canadian companies have expressed interest in getting in on the action in the U.S. market via CBD oil, but the Curaleaf-Cura deal shows that U.S. cannabis companies may soon rival their competitors to the north.
With the ability to consolidate around the U.S. CBD oil business, cannabis producers can use this new path to help establish a foothold across the country. This will prove to be invaluable when marijuana is eventually legalized federally; the companies will already have the infrastructure in place to distribute their products on a national scale.
On the flip side, Canadian marijuana companies will have an advantage when it comes to the production of marijuana.
This will go on to form a complicated, but likely lucrative, competition between Canadian and U.S. pot companies. Not to mention that this speaks to just how lucrative pot stocks are going to be in the U.S. when companies can actually exploit the nation-wide market.
Seeing as how Curaleaf Holdings was the big mover and shaker in the marijuana news today, it would be irresponsible of me to not take a more detailed look at Curaleaf stock.
The company, as mentioned above, is the largest cannabis company in the U.S. by valuation and it just completed a landmark deal that will likely continue to propel it upward. This could very well be the making of the Canopy Growth Corp (NYSE:CGC) of America.
CURLF stock surged by 10% in early-morning trading today. The stock was down about two percent, though, over the past five days.
With a market cap of over $3.0 billion and a stock price exceeding $10.00 (but only just), Curaleaf is in an interesting spot.
Officially departing cannabis penny-stock territory, this could be the beginning of an upward surge that places Curaleaf firmly atop the U.S. stock market. The stock has already doubled its value in 2019, much like Canadian marijuana stocks have.
It’s worth noting that Curaleaf stock behaves differently than its northern rivals. While Canadian marijuana stocks broadly follow similar trends (with the difference being in degrees and magnitude), CURLF stock has been more volatile in 2019 relative to Canadian pot stocks.
That is likely due to the fact that the U.S. cannabis stock market is in flux and will continue to send stocks on a roller coaster ride. Meanwhile, the Canadian market has settled to a degree and is more based on sales numbers in financial reports these days.
That is to say, there is a lot of potential in Curaleaf stock (if you can stomach the volatility).
From the new to the old, a classic pot stock pick of mine is back on top with a strong day of gains.
Hexo Corp (NYSEAMERICAN:HEXO) was up nearly three percent in early-morning trading today, while the stock has soared by almost 13% over the past five days.
HEXO stock continues to perform well despite a recent flood scare at its Gatineau, Quebec production facility.
The company has denied that any recent flood damage had taken place, although Hexo has a precedent of recording losses as a result of flooding, as seen in its 2017 financial report. (Source: “Hexo denies cannabis facility is affected by flood as stock suffers,” MarketWatch, May 1, 2019.)
With the record flooding in the region appearing to have skipped Hexo’s facilities, the company’s stock is on a nice upswing.
HEXO stock continues to shine as one of the best performers of 2019, and I don’t see that slowing down any time soon.
Canopy Growth stock, meanwhile, hasn’t seen too much movement today, but it is capping off a strong five-day run. CGC stock gained one point in early-morning trading and it is up about six percent over the past five days.
While there hasn’t been any major news from Canopy Growth in recent days, its stock continues to net strong and steady gains.
Sentiment around CGC stock is at an all-time high, I’d argue, as the company has demonstrated time and time again that it is the dominant force in Canadian pot.
With that, the industry leader is likely going to see stable growth as it continues to prosper.
CURLF, HEXO, and CGC Stock Performances
The performances of CURLF stock (black line), HEXO stock (blue line), and CGC stock (red line) over the past week are seen on the chart below:
Chart courtesy of StockCharts.com
The marijuana news today is a boon to pot stocks everywhere.
We’re seeing many marijuana stocks make healthy gains this week, while the U.S. cannabis market continues to mature.
Curaleaf Holdings is one of the leading forces in the U.S. cannabis market, and its acquisition of Cura Partners is a herald of even stronger deals to come from American pot companies.