It’s difficult to find a whole lot of good news in the markets these days. And attempting to find it in the cannabis sector is next to impossible. But it you’re looking for hope, this is the sector that has managed to hold on to it, it appears.That glimmer of bullishness is tucked behind the desperation, right next to the eternal optimism.
It’s difficult to spot if you’re looking at the stock charts, but it’s there. If you need proof, just look at what one former CEO said Monday:
“I believe many cannabis stocks, including Aurora, are undervalued and I will be watching present market conditions unfold. I will definitely be considering buying back in once the dust settles.”
That is what Terry Booth, the former head and co-founder of Aurora Cannabis (NYSE:ACB), (TSX:ACB), reportedly told BNN Bloomberg in an email yesterday when questioned about the disclosure that he had sold just over two-thirds of his holdings in the Edmonton-based marijuana grower. Booth, who left his post as the top executive at the company last month as part of a major corporate shake-up, sold $13.6 million of Aurora stock. He continues to hold an advisory position on the board of directors.
According to insider security filings, Booth sold 12.1 million shares of Aurora, which was 68% of his stake in the company, in a series of transactions between March 11-16.
He sold the majority of his stake in the company he helped found, he reportedly said, due to market volatility caused by concerns over the spread of the COVID-19 virus and a “number of opportunities” that have emerged.
Booth still owns 6.16 million shares of Aurora stock and options.
Aurora stock on Monday closed at US$0.692, down 10.12% in New York and at C$0.99, down about 7.5%, in Toronto. In the last year, the stock has lost almost 92% of its value.
Last week, as the threat of the COVID-19 virus pummelled the stock markets, Canopy closed below the $1 mark for the first time in more than three years.
Canopy Finally Launches Infused Beverage Line
There was a shimmer of good news released by Canopy Growth (NYSE:CGC), (TSX:WEED) on Monday. The Ontario-based cannabis company announced it has shipped its first pot-infused beverages to retail outlets.
The canned carbonated drinks, marketed under the name Houndstooth & Soda, are infused with THC, the component of cannabis that creates “the high.”
The roll-out of this beverage product line comes two months after Canopy announcing a delay in completing its bottling facility.
Canopy Growth traded down Monday, to close at US$10.28, a drop of 6.8% on the day in New York. In Toronto, the stock lost almost 5% on Monday to close at C$14.42. Shares of the largest marijuana grower in the world have shed about 77% in the last year.
Tilray Keeps Sinking
There was definitely no good news to be found when looking at the fate of Tilray (NASDAQ:TLRY) stock in the past few days. Last Friday, the British Columbia-based cannabis grower that is only listed on the NASDAQ lost almost 35%, and then took another hit on Monday, dropping an additional 24.22% to close at US$3.05.
The latest slide was triggered at the end of last week, when the company announced an equity sale, with the goal of raising more than $90 million which it planned to use for general purposes.
According to the terms of the $90.4-million stock offering, the company was pricing shares at $4.76 a piece, less than a third of its IPO pricing in 2018, a possible reflection of the company’s desperate need for cash. Shortly after being listed, Tilray shares made headlines when they catapulted to $300 on Sept. 19, 2018, about a month before marijuana was legalized in Canada.
In the last year, shares of Tilray have lost a mind-numbing total of almost 96%.