Cannabis stocks and industry purview

Cannabis is a highly speculative sector and the regulatory frameworks in Canada, US, and Australia are expected to play a crucial role as a deciding factor for outlook. Most of the companies are yet to make profits and declare dividends. Herein we have a list of 20 Cannabis sector stocks listed on Australian stock exchange.

Affinity Energy and Health Limited (ASX:AEB) – Formerly known as Algae.Tec, AEB is an Australia based algae products’ company under the energy and health sector; and works on the technology to produce algal oil and algal biomass for use as a feedstock in food and biofuel sectors. To develop cannabis-based products for animals, AEB teamed up with Queensland Bauxite’s 55%-owned subsidiary Medical Cannabis. To establish a breeding program to produce stock for veterinary medications, supplements and animal therapeutics, Medical Cannabis is providing AEB with its THC Delta 9 cannabis cultivars for Algae. With daily price change of -$0.001 or a percentage change of -5.882%, the stock was trading at a market price of $0.016, as at August 24, 2018. Over the past 12 months, the stock has seen a performance change of a -41.38%.

Atlas Pearls Limited (ASX:ATP) - Under the consumer discretionary sector, it is into perfume manufacturing, pearl farming, and distribution and jewelry retailing. To develop a supply chain of medicinal cannabis solutions, the jointly owned subsidiary company Cannabinoid Extracts Australia will pursue licenses. The company had reported a positive outcome at its latest private pearl auction held in Kobe, Japan on June 5 and 6, 2018. This has generated a total revenue of $2.4 million. With a daily price change of -$0.001 or a percentage change of -4.348% as at August 24, 2018, the stock was trading at a market price of $0.022. The EPS is negative at -0.003 AUD while the company is yet to generate profits.

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AusCann Groups Holding Limited (ASX:AC8) – The group is into manufacturing and cultivation, and supply of medical cannabis products. The Company focuses on investigating other opportunities in the medical cannabis sector, including acquisition or investment in other international plant breeders, producers and suppliers. The company was trading at a market price of $0.995 with a daily price change of $-0.035 and has seen a performance change of staggering 88.89% over the past 12 months. An optimal final dose form for its proprietary cannabinoid medicines study has been completed successfully by AusCann. The group is well known but still has a negative EPS of 0.009 AUD which indicates the loss making scenario and no dividends declared for the shareholders. We expect the group to witness a better earnings profile with many catalysts in place.

Bod Australia Ltd (ASX:BDA) - Natural cosmetics developer and distributor, entered into an exclusive manufacturing and commercialization agreement with Singapore Stock Exchange listed, specialty pharmaceutical company, iX Biopharma Ltd for supplying medicinal cannabis extracts to iX Biopharma for enabling iX Biopharma and to create a unique natural medicine product delivered on iX Biopharma’s proprietary WaferiXTM technology for use in the Company’s Phase I Clinical trials. The company was trading at a market price of $0.600 with a daily price change of -$0.010 and has seen a performance change of staggering 408.33% over the past 12 months. With a negative EPS of -0.051 AUD the company is not generating much of profits and hence unable to declare dividends to the investors while investors eye for better future based on its proprietary technology.

Botanix Pharmaceuticals Ltd (ASX:BOT) - It is a pharmaceuticals company under the health care segment. The company was listed in 1985 and is based in Aberdeen Street, Perth, Australia. The stock was trading at a market price of $0.096 as at August 25, 2018. Over the past one year, the stock has seen a performance change of 408.33%. During the second half, the company has completed its first acne patient studies with BTX 1503 in January 2018 and started a Phase 2 clinical trial in June 2018 and this is expected to get completed by mid of 2019. Like most of the Cannabis stocks, the low EPS of -0.012 AUD has been noted while the group is watched for better revenue generation.

Cann Group Limited (ASX:CAN) - After the company prescribed the Australian patients with Aurora medical cannabis, through the Therapeutic Good Administration’s (TGA) Special Access Scheme, the stock rose to 2.750% on August 24, 2018. The patients can access the medicinal cannabis oils after being approved for treatment through the TGA’s Special Access Scheme or authorized Prescriber Scheme. CAN has imported the first products from its strategic partner and major shareholder Aurora as sponsor and the product supplied being ‘Aurora 1:1 Drops’ comprised of an equal ratio of THC and CBD. The stock has seen a performance change of staggering 139.30% over the past 12 months and was trading at a market price of $2.740. Cann is one of the most prominent stocks when it comes to market capitalization ($383.36 million); however, the EPS is still on a negative side -0.013 AUD which is linked to profits and dividends scenario.

CannPal Animal Therapeutics Limited (ASX:CP1) – It is a health care company and in the first quarter of this year it planned to begin its pharmacokinetic and safety clinical trials using its CPAT-01 drug. With the University of Melbourne to Research Epilepsy Treatment for Dogs, CannPal has entered an MOU and will work towards a pilot study to determine cannabidiol’s efficacy in the treatment of epilepsy in dogs. The stock was trading at a market price of $0.195 and with daily price change of $0.010 or a percentage change of 5.405% as at August 24, 2018. The stock has seen a performance change of an 8.82% since its inception. The EPS is negative -0.012 AUD with profit not coming up to the expected levels, with no dividends to declare like most of the cannabis stocks. The Company has a cash balance of $5.11 million.

Capital Mining (ASX:CMY) - With the demand for batteries, Capital Mining is aware that the price of nickel could rise significantly. As announced in March 2018, over the two Midwest projects of Dalgaranga and Big Bell with an outline of a proposed program, the group commenced planning with regards to an exploration program. The company is into molybdenum, thorium, uranium, gold, copper, lead, zinc, and rare metal exploration. The stock was last trading at a market price of $0.005 as at August 24, 2018. The stock has seen a performance change of an -83.33% since its inception. The company has a negative EPS of -0.256 AUD while the group is suspended from trading with update on appointment of voluntary administration.

Chapmans Limited (ASX:CHP) - It is a diversified Investment Company, which is engaged in special situation investments. The official listing date was 1971 and the company is based in Phillip Street, Sydney, Australia. During the June quarter the company posted the Net Cash Flow from operating activities of $436,000 and the company expects cash flow for the next quarter to be $410,000. CHP plans to fund its working capital requirements on an ongoing basis, through a combination of equity and debt raisings and the sale of existing investments. The funds raised will be used for working capital and existing investments. The stock was trading at a market price of $0.001 and with a flat daily price change as at August 24, 2018. The stock has seen a performance change of an -70.00% since its inception. The group is now under discussion for a pending Medical Cannabis Deal under a strategic move.

Creso Pharma Ltd (ASX:CPH) – It is under the health care sector, with cash balance at 30 June 2018 at $11.35 million (vs. 31 March 2018: $11.03 million) with net operating cash outflow during the quarter ended 30 June 2018 of $1.65 million. Cash receipts for the period included receipts from customers totaling $7k for the quarter ending 30 June 2018. Recently, the group has highlighted about raising $2.7 Mn from the Options Entitlement Issue for its operations, primarily as its working capital. Then $2.5 million in cash will be funded from loans to the company. The stock was trading at a market price of $0.575 and was down 4.9% as at August 24, 2018. The stock has seen a performance change of an 24.74% since its inception. Relatively the EPS is negative -0.181 AUD compared to the peers and reflects the earnings being affected and no dividends to be paid out.

Elixinol Global (ASX:EXL) - under the consumer staples sector, Elixinol USA enters into joint venture to cultivate high-CBD organic hemp: is an Australian group that is aiming to become a leader in the industrial hemp and medicinal cannabis businesses. Elixinol is a small-cap company with the market capitalization of circa $142.04 Mn as of Aug 24, 2018. Recently, the group’s subsidiary, Elixinol USA and Kersey Ag Company LLC have formed a joint venture in the name of the Northern Colorado High Plains Producers (NCHPP) with the equity capital in the proposition of 50% each. The stock was trading at a market price of $1.365 and with a flat daily price change as at August 24, 2018. The stock has seen a performance change of an -4.83% since its inception. The group has not paid out dividends over the past few years considering the sector performance in totality.

ESense-Lab Limited (ASX:ESE) - It is a health care company which is into research and development and technology for the creation of 'virtual plants'. After the AGM on 30 March 2018, the company paid strategic-investor MMJ PhytoTech Limited (MMJ) A$199,000 and announced completed the development of an E-liquid formulation that provides the aroma of various cannabis strains. The stock was trading at a market price of $0.057 and with a flat daily price change as at August 24, 2018 and is trading at a 52-week low. The stock has seen a performance change of an -70.00% since its inception. The earnings per share for the stock is -0.045 AUD and with no dividends the cannabis stock is not generating much of profits.

EVE Investments Limited (ASX:EVE) – It is a financial sector group which is into investment in a broad cross section of technology sectors. The company is based in Churchill Avenue, Subiaco, Australia. To acquire 100% of leading organic tea tree oil producer Jenbrook Pty Ltd, EVE entered a binding Share Purchase Deed. Acquisition includes a 49% holding in rapidly growing US distribution business and plantation assets. The stock was trading at a market price of $0.009 and with a flat daily price change as at August 24, 2018 and is trading at a 52-week low. The stock has seen a performance change of an 100.00% since its inception. The group’s P/E is at a fair level of 3.910 amongst its peers and the company has a positive EPS of 0.002 AUD reflecting a better position.

Lifespot Health Ltd (ASX:LSH) – It is a health care group and is in the development of telemedicine i.e. mobile applications. As at 30th June 2018, the company has a Strong balance sheet with cash of $3.284M. The business is in a strong position with no cash-based acquisitions or additional fund raising required. The stock was trading at a market price of $0.085 and with a flat daily price change as at August 24, 2018 and is trading at a 52-week low. The stock has seen a performance change of an -37.04% since the last one year. For integrated system licensing opportunities in Canada, USA, Australia and New Zealand Demonstrations scheduled in with major cannabis players. The stock has a comparatively lesser negative EPS of -0.028 AUD and is yet to make profits or declare any dividends.

Medlab Clinical Ltd (ASX:MDC) - It is a clinical company and is into nutritional pharmaceutical research and development. In line with the company’s plan is MDC’s progress to date on the pain management product, Nanabis (cannabis plant extract). Therefore, MDC has commenced medical Education Seminars in Sydney and more will follow. The first batch of Nanabis product has been manufactured by PPP in Melbourne and validated analytical release for supply was expected by 8th March 2018. The stock was trading at a market price of $0.420 and with a flat daily price change as at August 24, 2018 and is trading at a 52-week low. The stock has seen a performance change of an -37.04% since the last one year. With no dividend history the company has also a negative EPS of -0.024 and is not able to generate substantial profits.

MGC Pharmaceuticals Ltd (ASX:MXC) - In relation to legalizing the production of cannabis for medical use in Malta, MXC announced that the final legislation has been passed by the Maltese Parliament. Following this development, the Company is now expecting to have final formal agreements from the Malta Medicine Authority to be signed in the coming weeks. Once the license by the Malta Medicines Authority is issued, the group will commence work on the project in Malta. The stock was trading at a market price of $0.055 and with a flat daily price change as at August 24, 2018 and is trading over the 52-week low level. The stock has seen a performance change of an -37.04% since the last one year. The company has a negative EPS of -0.011 AUD.

MMJ Photoetch Ltd (ASX:MMJ) - MMJ has been continually focusing on cost-effective, fast-to-market oral prescription drugs. Further, MMJ’s first clinical trial highlighted the favorable bioavailability of the capsules in comparison to Sativex – a market-leading, commercially available cannabinoid oral spray produced by GW Pharmaceuticals. Through this strategic investment, MMJ has strengthened its position in the Canadian cannabis sector, via its respective holdings in Harvest One Inc which is 59%. The stock was trading at a market price of $0.225 and has seen a performance change of -39.19% since the last one year. The relative EPS of the stock is -0.081 AUD which indicates the sector vulnerability to a speculative scenario in terms of the profits and dividends.

Queensland Bauxite Ltd (ASX:QBL) - The company is focused on developing DSO bauxite for export to the international markets. North Queensland Project and Pilbara gold project are two of the company’s projects. The company has recognized that the intended capital raise at 8c is no longer an immediate practical option. As previously advised, the directors intended to utilize their discretion to allocate the raising to shareholders, in accordance with the size of their shareholding and the length of time the shareholder has held their shares, the board has decided that the revised offer under the compliance will be a discounted raising exclusively to shareholders of QBL. The stock is currently suspended and last traded at $0.037 as at August 24, 2018. The stock has seen a performance change of 236.36% since the last one year. The company has EPS standing at -0.003 AUD.

Roto-Gro International (ASX:RGI) – It is under the industrial sector and the company is into distribution of automated rotary hydroponic garden system. To enter into a joint venture with Freshero Pty Ltd in the organic fresh produce supply industry, RotoGro has entered into a Heads of Agreement. The stock was trading at a market price of $0.360 and has seen a performance change of 25.86% since the last one year. It is a wholly-owned subsidiary of Roto-Gro International Limited. The stock has undergone a performance change of 25.86%. The company has an EPS standing at -0.011 AUD and is a close watch.

Stemcell United Limited (ASX:SCU) – It is into the health care segment with commercialization of dendrobium stem cell extraction. The stock was trading at a market price of $0.024 and with a flat daily price change of $0.001 as at August 24, 2018. Besides this, the group plans to manufacture some of its TCM beauty products in China and this import-export license will allow SCU to export from China to Hong Kong, Singapore and Australia. SCU has a Co-operation Agreement and an exclusive right to own a 51% interest in HFIH. To supply 50 tons of Daemonorops Draco Blume extract (Resina) to Chinese customer over five years period, SCU has secured a contract. The company has an EPS standing at -0.012 AUD

The Hydroponics Company (ASX:THC) - It is the health care segment company which develops and delivers medical cannabis and design and construct hydroponic greenhouses. It manufactures and distribute hydroponic equipment. Its first medicinal cannabis product has been imported from the company’s European strategic alliance partner, Endoca. The product will be provided through the Medicinal Cannabis Medicines Portal (MCMP) under the Approved Prescriber and Special Access Schemes. Further, the products will be available include Endoca’s CBD and unique CBD+CBDA formulations. The stock was trading at a market price of $0.480 and with a daily price change of -$0.005 and percentage change of -1.031% as at August 24, 2018. The stock has seen a performance change of an 25.86% since the last one year. It is a wholly-owned subsidiary of Roto-Gro International Limited. The company is based in Lime Street, Sydney, Australia. The company has an EPS standing at -0.031 AUD and hence is yet to make profits and start declaring dividends.

Zelda Therapeutics Ltd (ASX:ZLD) – It is the health care company and is also into mineral exploration with market capitalization of $52.12 Mn. The group has made significant progress in growing its clinical research program. The group focuses on human clinical trial on sleep disorder-insomnia eczema and other dermatology indications. The group also focuses on pre-clinical research program for breast, brain and pancreatic cancer. The stock was trading at a market price of $0.070 and with a daily price change of $0.001 and percentage change of 1.449% as at August 24, 2018. The stock has seen a performance change of 25.86% since the last one year. ZLD is one of the companies which has a P/E of 14.890 and an EPS standing at positive 0.005 AUD and hence compares better amongst peers in terms of performance.

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