As investors await better performance from the cannabis stock market, September offered another critical update on the biggest scandal in the Canadian market.
During the month, Health Canada handed CannTrust Holdings (NYSE:CTST,TSX:TRST) a suspension for cannabis production. The company was originally found to have engaged in unlicensed growing at its Pelham, Ontario, facility in July.
The suspension directly led to a second provincial distributor issuing a return of all CannTrust product — following the ruling from Health Canada, the Alberta Gaming, Liquor and Cannabis Commission announced it would ask CannTrust to take back C$1.3 million worth of items.
A spokesperson for the provincial agency told the Investing News Network it would consider stocking product from the maligned producer at a later date if Health Canada reinstates its license.
CIBC begins covering three additional firms
John Zamparo, equity research analyst at CIBC Capital Markets, added Aurora Cannabis (NYSE:ACB,TSX:ACB), The Supreme Cannabis Company (TSX:FIRE,OTCQX:SPRWF) and Organigram Holdings (NASDAQ:OGI,TSXV:OGI) to his coverage of the cannabis space in September.
The analyst issued “outperformer” ratings for Supreme Cannabis and Organigram, while Aurora obtained a “neutral” rating for its stock.
“At Aurora’s valuation (second largest among the cannabis names), we wish to see greater balance sheet strength, the presence of key strategic partners or material exposure to the US CBD market,” Zamparo wrote in his note to investors.
Zamparo praised the brand recognition Supreme Cannabis has been able to achieve in the Canadian market. The analyst also remarked that Organigram offers investors a reasonable price point entry into the marijuana space.
Watch the video above to get the full details on cannabis highlights for the month of September.
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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.