The cannabis industry has seen some bumps so far this year as excitement grows for the upcoming full legalization of the drug. A market correction slapped the majority of companies in the sector in early February, causing a re-evaluation of the real worth for some of these companies.
Experts agree a consensus will be reached once companies are able to fully report their sales and production costs. Despite some of the uncertainty in the market, there are still success stories so far this year, proving the worth of this market for new investors.
Here the Investing News Network (INN) brings a closer look some of the top cannabis companies on the TSX Venture exchange based on their earnings so far in 2018. The companies below have market caps of over $50 million but less than $500 million.
All figures are current as of market closure on Tuesday (February 20).
YTD: 18.24 percent; market cap: 150.72 M; share price: $1.88
Invictus MD is a registered licensed producer (LP) for the cultivation and sale of dried product, and an added license for the production and sale of oil products.
So far this year the company has updated shareholders in a variety of transactions, with a particular highlight being its first official sale of 1520 kilograms of dried product to Canopy Growth (TSX:WEED). This sale was part of the participation of, Invitus’ investee, AB Laboratories in the CraftGrow program from Canopy.
“The effort gives us immediate access to the largest customer base in the rapidly expanding medical cannabis market,” Dan Kriznic, chairman, and CEO of Invictus MD said as part of the announcement.
Invictus announced, February 7, it had increased its share in AB Labs from 33.3 percent to a 50 percent ownership interest.
ICC Labs (TSXV:ICC)
YTD: 44.12 percent; market cap: 202.32 M; share price: $1.47
ICC is an interesting proposition for investors, since its focus lies in the Latin American market, actively the company is engaged in Uruguay. This year ICC made a move into the Colombian medical cannabis sector by obtaining two licenses for the cultivation of non-psychoactive cannabis plants and to obtain cannabis seeds under the Colombian regulatory regime.
“We believe that our experience in Uruguay… will give us a competitive advantage over other Colombian license holders,” Alejandro Antalich, CEO of ICC Labs said.
Its Uruguayan effort received a key update on February 7 when ICC announced its application for the assembly of a new 1 million square foot greenhouse facility, located on land belonging to the local government. Antalich said this new facility could produce an annual yield of 120 million grams of dry flower.
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Top 5 gaining cannabis stocks on the TSXV
YTD: 32 percent; market cap: 146.71 M; share price: $0.99
Maple Leaf’s focus is across all of North America and describes its operations with three current projects in British Columbia, California, and Nevada. Earlier this year the company provided shareholders with a complete update and closer look into its work in California and Nevada.
On February 6, the company disclosed a conflict with the TSXV as an active party of cannabis-related operations in the US, a market where federally the drug remains illegal. Maple Leaf received a notice from the exchange asking for documents to show compliance with guidance issued last year. The company said it would respond since they see themselves being in compliance with the regulations from the TSXV.
However, the company disclosed it is fully prepared to move its common shares into an alternative exchange if the TSXV disapproves its US operations.
The Company is of the view that its continued operations in the United States are integral to its business and the value that it expects to provide to its shareholders. Maple Leaf believes that it is in the best interests of its shareholders to voluntarily delist the Common Shares from the TSXV, instead of divesting Maple Leaf’s assets in the U.S, and concurrently list the Common Shares on another public stock exchange in Canada. The Company has made an initial application to list its Common Shares on a public stock exchange in Canada and is excited at the potential of listing the Common Shares on such exchange and the opportunities it provides to its investors, as Maple Leaf continues the ongoing development of its business operations.
YTD: 59.48 percent; market cap: 268.16 M; share price: $2.44
With the increase of international opportunities for Canadian companies in the cannabis space, ABcann announced this year its Australian subsidiary had obtained an import license so now the parent company can supply their medical cannabis products to that patient population.
Back in Canada, the company reached a significant milestone when it received an official Health Canada license for the production of medical cannabis oils. ABcann expects a final inspection from the Canadian agency once they have “saleable extracted finished products” in the first quarter of 2018.
“The expansion and innovation of our product lines are a top priority for the Company as we continue to serve the needs of our customers, and we anticipate strong demand for our cannabis oil products,” Barry Fishman, CEO of the company said.
National Access Cannabis (TSXV:NAC)
YTD: 62.69 percent; market cap: 81.98 M; share price: $1.09
In mid-February, the company earned one of the four coveted retail licenses in the province of Manitoba to sell cannabis. The company will then open a network of retail stores by the third quarter of 2018.
“With the Province’s decision today, Manitobans will have responsible, secure access to recreational marijuana once legalization occurs,” Mark Goliger, CEO of the company said.
National Access Cannabis added they plan to “deepen” their relationship with CannaRoyalty (CSE:CRZ; OTCQX:CNNRF), Cannabis Wheaton Income (TSXV:CBW), and Tilray a private producer, as an effort to build their planned retail presence in Manitoba.
The company also announced this year the closing of a $6 million private placement for 10,909,091 units of National Access Cannabis.
Scythian Biosciences (TSXV:SCYB)
YTD: 72.41 percent; market cap: 144.56 M; share price: $27.50
Scythian announced in mid-February the confirmation of its public listing on the NASDAQ Capital Market exchange under the symbol SCYB. Management for the company will ring the closing bell in New York on the day of its launch on the exchange on February 22.
“The Nasdaq listing represents greater accessibility and liquidity to a broader group of investors and increased market recognition, while our dual listing on the TSXV provides continued access to the investment community in Canada,” Jonathan Gilbert, CEO of the company said.
The company also entered the radar of major LP Aphria (TSXV:APH). First, the CEOs of Aphria and its US partner Liberty Health Sciences (CSE:LHS) became board members for Scythian Biosciences. Then, on February 13, it was announced Aphria acted as a leading investor for a $28.7 million financing deal.
Scythian revealed the net proceeds from the deal were going to be used for continued research with the University of Miami, corporate purposes and “potential acquisitions” in the industry.
Newstrike Resources (TSXV:HIP)
YTD: 83.93 percent; market cap: 413.26 M; share price: $1.03
Newstrike Resources is a company focused on branding. Its subsidiary Up Cannabis is a brand appealing to the lifestyle aspect of cannabis consumption.
Despite suffering one of the biggest deal reversals in the cannabis industry so far, Newstrike has displayed strength in the market and its growth so far this year shows some of the confidence from the investor market.
After Aurora settled a deal with CanniMed, Newstrike was left on its own. The company earned a $14.1 million package since the acquisition from CanniMed fell through and has since announced a variety of financing deals for themselves.
Jay Wilgar, Newstrike’s CEO, said the money from the failed CanniMed deal would go towards accelerating the development of their 160,000 square feet Niagara greenhouse facility.
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Editorial Disclosure: Invictus MD, ABcann Global and Maple Leaf Green World are clients of the Investing News Network. This article is not paid-for content.
Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.