Tuesday at 4 pm EST, I'm hosting a fireside chat with
@Goldflora_CA
CEO Laurie Holcomb. We'll discuss the keys to competing in California, cultivation expansion, and the rise of its new GRAMLIN brand.
It's open to all investors; please register here:
My story: I used to be a hedge fund manger, then my dad got sick. Cannabis helped him & I changed course. In 2016 I opened a dispensary in California, started growing & dedicated myself to
#cannabis
. Now, I’m focused on blending the cannabis & investment knowledge.
#MSOGang
Great job by
@headset_io
sorting through the data and creating bottom-line metrics on the rescheduling comments.
Here are some highlights from their report:
* 92.45% of comments were in favor of changing cannabis's schedule
* Only 7.55% were against any change
Of those in
My dad suffers from chronic pain and once required 1,000mg of OxyContin/day to control it. With the help of
#cannabis
, he’s down to 30mg/day, a 97% reduction. Cannabis is an exit drug, not a gateway, and everyone should have access to it.
#LegalizeIt
#PlantsOverPills
#MSOGang
Last night a group of parents were talking about how you must keep cannabis in a safe so the kids don’t get it. But, I noticed they keep beers in the fridge and wine in an unlocked rack.
Same for stores—to get cannabis you have to check in w an armed guard. Meanwhile, grocery
I'm losing my patience:
2,552: number of days since SAFE Banking was first introduced
1,192: number of days since Biden took office
1,171: number of days since MSOS peaked on February 10,2021
679: number of days since the Attorney General said the Justice Department will address
This hits home—when I was young, my older brother died from a drug overdose. That just can't happen with cannabis. I wish we could stop the political nonsense and provide safe access for everyone. Anything less is hostile and immoral.
@JimBelushi
#MSOGang
#CannabisCommunity
Lately, I've been having more conversations about how hard this journey has been. I've had it with investing friends and operators. As we enter a critical next three quarters, here's some stuff on my mind.
Resistance, I feel it more and more. It's hard to get started sometimes,
Unpopular opinion: unless you are using options, the exact timing of a potential DEA announcement is not critical. Own quality, extend your time horizon and enjoy your day.
Today marks two years since $MSOS peaked at $55.91 on February 10th, 2021. Politics, price compression, inflation, and a broad bear market have taken their toll. Somehow, I’m still happy to be here and am looking forward to brighter days.
Much to process, but I’m stuck w simple thoughts:
- Biden needs votes.
- Head of the DEA is a Biden appointee and this is an election year.
- The HHS recommendation is stronger than I expected.
- If the DEA agrees, pot stocks go up a lot more.
- History suggests there is a
$GTBIF reported Q4 revenue of $278 million, ahead of the street’s estimate of $270.5 million. Stronger revenue was driven by the opening of six stores in Florida and one in New York and robust retail and wholesale demand in Maryland. AEBITDA of $91 million blew out the $79.8
"We believe there is still significantly more upside in cannabis MSO multiples. Investors who fear that they may have missed the move should reflect on historical multiples and discounted cash flow analysis, both of which will reveal significant incremental upside potential to be
I spoke with a former top small-cap manager who is currently managing his own money. He said, "It's all about free cash flow. Once 280E goes away, I'm calling all my institutional relationships and saying it's time. This goes from a trade, to a 3-5 year hold and there's an
Don’t panic. Cowen had a call and it sounds like things may be delayed until tomorrow or Wednesday for the NDAA. Even if it’s not in there, Omnibus or stand-alone remains likely. Any delay is not about cannabis.
Cannabis edibles and beverages should be sold at movie theaters. The GTI/Circle K deal is cool, but someone should do an AMC partnership. California has 60 AMC theaters and there are 593 nationwide.
Friends, I have exciting career news to share! I’m happy to announce I have joined
@WTR_Research
as Managing Director covering the cannabis sector. Below is a description of our business and how we help investors and cannabis companies. (1/6)
As I start the day waiting for another Uber in Vegas, here’s three thoughts from the first day of the
@MJBizDaily
conference:
1. We’re all struggling. One MSO exec said it’s the hardest he’s seen it in over a decade. But, lots of optimism around S3 and its potential impact.
2.
This sector is so small and under covered that you can say a first name and we all know who it is…Doug, Todd, Morgan, Emily, Toby, Jane, etc… cool and lame at the same time. I look forward to not knowing you all so well.
It’s been 207 days since Q3 ended, and that’s the last look we have into
@veranobrands
. Even if it ends well, $VRNOF not reporting Q4 til May and 19 days of silence since being told “very soon” are not acceptable. We need higher standards for our industry & investments.
#MSOGang
I participated in the Needham virtual conference today. In separate meetings, 2 tier-one CEOs were not just bullish on SAFE, but said there may be a path to uplisting and 280E removal... “they figured out a revenue-neutral way to do it…” Please see my disclaimer below.
#MSOGang
My latest research, “An Introduction To Cresco Labs: The Leading Cannabis Wholesaler” highlights another dominant MSO. If you like it, please retweet and tell a friend—we need to build a bigger
#MSOGang
! $CRLFB $CL
#stockstowatch
#CannabisCommunity
$MSOS
$MSOS is now 2% lower than the day before the AP reported that the DEA agrees with the Schedule III recommendation.
Explanations from people I respect vary from this is the buying opportunity of a lifetime to concerns about the time frame and FDA involvement. We know markets
Today is the second-highest volume ever on $MSOS (yesterday was number one) and the seventh-highest dollar volume. Yesterday’s action led to $12.2 million in inflows, we’ll see what happens today.
I feel like one day I'll need to talk to a therapist about the last 883 days in cannabis. The day-to-day is insane and exhausting. I love it, but it is not easy.
Just looked down and $MSOS is up 4.20%, so that's cool.
I created a 5-factor model and ranked $CURLF, $GTBIF, $TCNNF, $VRNOF and $CRLFB by EV/Sales, EV/Adj. EBITDA, margins, sales momentum, and earnings momentum. By this limited criteria, $VRNOF was the clear winner. If this interests anyone, I’ll write it up and share the results.
I know this firsthand. My dad has chronic regional pain syndrome. Before cannabis, it took 1,000 mg/day of OxyContin to control his pain. Now, he’s off opiates and uses CBD, CBG, and flower. Better pain control with fewer side effects. This option should be available to everyone.
NEW STUDY published by the American Medical Association finds that medical marijuana is associated with "significant improvements" in quality of life for people with conditions like chronic pain & insomnia—and the effects are "largely sustained" over time
DEA REVIEWING MARIJUANA'S CLASSIFICATION (from multiple sources, just a headline for now....I don't know exactly what this means...will share as we learn more...)
Four things I'm excited about:
1. S3 is on track.
2. Florida is polling well.
3. Ohio is up and running.
4. The democratic ticket keeps getting more cannabis-friendly.
Meanwhile, $MSOS is flat YTD. As my friend who manages a small-cap fund recently said, cannabis is going
We’re down to the wire to get
#SAFEBanking
done. Let’s all give it a final push and take what action we can. Please invest two minutes, click the link below, and make our voices heard.
#SAFEnow
@SenSchumer
"WASHINGTON – The U.S. Drug Enforcement Administration will move to reclassify marijuana as a less dangerous drug, The Associated Press has learned, a historic shift to generations of American drug policy that could have wide ripple-effects across the country."
As frustrating as it is to watch Canadian LPs and ancillaries rocket higher, it makes me think the upside when MSOs get up listed might be bigger than I imagined. This space is painfully misunderstood.
#MSOGang
$MSOS $PSDN
#StocksToBuy
#CannabisCommunity
This is why I got in to cannabis. My dad has had chronic regional pain syndrome and hasn’t been able to work since I was 16. He was up to 1,000mg Oxy and still suffering. Today he takes zero opiates. CBD, CBG and dabs for relief have changed his life. 1/2
“Schumer and the bipartisan group plan to attach this legislation to a must-pass year-end bill like the annual National Defense Authorization Act.”
#soon
“Anyone can grow cannabis” is one of the most ridiculous arguments against MSOs. This is my 6th season and I still produce a marginal product, despite having great genetics in an ideal climate. There are valid objections, but this is not one of them.
#MSOGang
#CannabisCommunity
One of the top newspapers contacted me today to discuss the tension between hemp and cannabis in Florida. It's nice to see main-stream media covering this story, and I hope some education can shine a light on Desantis' hippocracy and help voters make more informed decisions.
Today is day 769 of the $MSOS drawdown. This is starting to rival the record NASDAQ bear market that occurred in the early 2000s that lasted 929 days. This would take us to August 28th, 2023.
Not sure what to do with this info, but I looked it up and thought I’d share it.
In my continued quest to provide boring data that will garner few likes, below are current ratios for the tier-one MSOs. The current ratio measures a company’s ability to meet its immediate financial obligations using its current assets. A higher current ratio indicates a more
An excerpt from Cowen’s Washington Research Group. They see McConnell as a risk and feel year-end Omnibus is the best bet. Overall, they are still at 75% that it gets done, but NDAA is less likely.
#SAFEBanking
#cannabis
This week $MSOS had $ 29,340,400.00 in inflows and rose 7.65%. While we're happy with progress in Ohio and New York, it's all eyes on S3, and sentiment on timing and the outcome is going to drive prices--and I think that's fair. A lot is at stake. Thx
@junglejava1
for the data.
Cowen on $CURLF…their Bellmawr New Jersey store is doing $6mm/month in sales. That’s over $70mm a year from one location. As we approach Q3 earnings, exposure to New Jersey will be a key differentiator.
“U.S. cannabis multistate operator Curaleaf Holdings is in talks with the Nasdaq and Toronto Stock Exchange about possibly uplisting from the smaller Canadian Securities Exchange to gain access to big institutional investors and more liquidity.” $CURLF
This 100%. Cannabis is not for everyone or everything, but it’s a less harmful recreational substance and a valuable medicine for those that need it. If it’s not for you, all good, but that does not mean it should not be available to everyone that needs or want it.
10 years ago I was pretty skeptical about the true utility of cannabis as a medicine. Then I went on an investigative journey to speak to scientists around the world, visit labs and have long deep conversations with patients. Bottom line: it is not a panacea, nothing is. But I am
“Cannabis advocates celebrated the findings, noting that they “are consistent with those of prior studies concluding that cannabis inhalation, even long-term, is not positively associated with COPD, lung cancer, or irreversible airway damage.”
I'm excited to share that
@mayortoby
,
@MorganPaxhia
, and I are starting a new Spaces/podcast called Higher Exchanges. It's a weekly conversation about the latest cannabis-investing news. Set the reminder, and it will be recorded if you can't make it live.
New all-time low on $MSOS. The ETF has dropped 88% over the past 686 days and is down 46% MTD. It will take an 830% return to get back to the all-time high.
For the 17 of you still out there, here are updated 2023 EV/Sales and EV/EBITDA for the tier-oneish MSOs. The average valuation for this basket is 6.5x 2023 EBITDA and 1.5x 2023 revenues. $CURLF $GTBIF $VRNOF $TCNNF $CRLBF $TSNDF Source: YCharts
It would be wild to see the head of the DEA (a Biden appointee) go against the HHS recommendation in an election year.
"The poll conducted by Lake Research Partners and commissioned by the Coalition for Cannabis Scheduling Reform (CCSR) showed that 58 percent of likely voters
Reminder: even among the hard cores here, less than half increased their cannabis exposure ahead of SAFE. It’s been a while since I’ve said this, but I can’t wait for it to be Monday.
Seven day Google Trends for SAFE Banking and cannabis stocks. Again, outside of our bubble, few care. If there’s news tomorrow, search interest will jump. We’ll see how this translates to stock prices.
“Everybody was talking about cannabis being the best thing; we were short,” Kassam, 42, said. “Then people said cannabis is the worst industry in the world now, so we’re very long.”
I'm proud to share my latest research, “An Introduction To Glass House Brands: California's Greatest Hope.” If you like it, please retweet and tell a friend—I’ve been working hard to build the website!
#MSOGang
$GLASF $GHBWF
#CannabisCommunity
$MSOS gained 11.95% last week and had $44.8 million in inflows. AUM is now $1.01 billion. We'll see if we can continue the streak and get our sixth straight week of positive returns! As always, thanks
@junglejava1
for the data.
$MSOS is up 21% from the bottom and 18% this month. I don’t see anyone pounding the table that we’ve seen the bottom. But, I just read 20 bearish takes in the last 5 minutes. Historically, this is bullish and a characteristic of market bottoms.
#MSOGang
Today was the biggest one-day return for $MSOS since September 5th and the most volume since September 15th. Good signs, but I remain comfortably numb until we hear from the DEA. Regardless, great day and enjoy the weekend!
I’m pleased to share our initiation of coverage report on
@MariMed_Inc
. They offer a rare combination of a strong balance sheet, double-digit revenue growth, and cheap valuation. Below is a preview, read the full report here: $MRMD
I listened to the $CURLF earnings call twice. It always sounds like Boris is selling something, whereas others like Ben and George are just explaining the story. Maybe it’s simply a style thing, but it makes me uncomfortable.
#MSOGang
Check this chart out—flower prices in the US increased again this week. I know in California supply is continuing to tighten and prices are going up. I see this persisting for sure through the summer light-dep harvest in June/July and likely until October.
While $MSOS traded just 5% higher-than-average volume today, $MSOX traded almost 600% more shares than normal. Maybe someone knows something—and we might see some creations that lead to more MSO purchases. Oh, $MSOS was up 3.90% while $SPY dropped 1.03%, which is also curious.
For those not familiar, sharp end-of-day selling in cannabis stocks may be due to inflows coming into $MSOS. Market makers buy a tracking basket to hedge exposure when they get inflows. Right before the close, they sell the basket and deliver cash to the ETF.
If HHS recommending Schedule III on August 30th was earlier than expected and increased the probability of landing on Schedule III, how does it make sense for the stocks to trade at the same price as before that news?
Fascinating stuff from Kim on the $TCNNF call:
"We will be paying taxes, but we plan to pay taxes under a normalized corporate tax regime. And in absence of those 280E payments moving forward as we await the IRS response on our refund claim. So again, no tax payment due for us