- The S&P/TSX Cannabis Index grew close to 25 per cent in the past 12 months.
- The quest to innovate in the medicinal cannabis space is on a constant surge.
- One of these companies was chosen to deliver a consignment of dried cannabis to serve French patients.
The S&P/TSX Cannabis index highlighted a one-year return of close to 25 per cent. This comes with constant innovation in the medical cannabis segment. Many of the cannabis manufacturing companies were seen launching medicinal cannabis in the form of soft-chew, dried medical cannabis and medical cannabis edibles, which are available in multiple flavors.
A slight change in consumer behavior was seen with innovative products in recreational cannabis and cannabis-derived products.
On that note, let us explore some cannabis stocks which can be fetched under C$25.
- Aurora Cannabis Inc (TSX: ACB, NASDAQ: ACB)
Aurora delivers innovative medical cannabis that is believed to be of high quality to its customers. The company seeks to be an industry leader in each market it serves. The company held a market cap of C$ 1.8 billion and posted a price-to-book (P/B) value of 0.81 on August 24, 2021.
Stocks of Aurora closed at C$ 9.11 apiece on August 24, 2021, and on February 10, 2021, it reached its 52-week high of C$ 24.1.
The management of Aurora stated that Aurora Germany GmbH, a subsidiary of the company and another company, successfully shipped a consignment of dried medical cannabis to better serve French patients. The initiative is referred to as the French pilot program.
Aurora Cannabis posted total cannabis net revenue of C$ 55.2 million in the third quarter of fiscal 2021, down 20.8 per cent Year-over-Year (YoY). Its adjusted gross margin before fair value adjustments was 44 per cent in the same quarter.
During the quarter, responding to the demand, Aurora totally produced cannabis of 14,484 kgs and subsequently sold 13,520 kgs of cannabis from that lot.
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- Tilray Inc (TSX: TLRY)
Tilray has pioneered research on cannabis, marking the strength of its product portfolio with over 20 brands across 20 countries. The cannabis company held outstanding shares of 449.22 million and a market cap of C$ 7.8 billion on August 24.
Tilray purchased senior secured convertible notes issued by MedMen, an American cannabis retailer. These convertible notes come with the option to convert into equity. Gaining an equity position in MedMen will give Tilray easy access into the US cannabis market, subject to federal approval.
As per the update available on August 5, the company launched medical cannabis edibles available in different variants of chocolates and soft chew gummies. The chew gummies are made available in watermelon and pineapple-mango flavors.
At market close, stocks of Tilray were priced at C$ 17.35 on August 24. It traded nearly eight per cent above its 52-week low of C$ 15.8 (July 27, 2021) on this day. It reached its 52-week high of C$ 27.88 on June 9, 2021.
Tilray Inc posted total revenue of US$ 152.19 million in Q4 FY21 and total revenue of US$ 513.09 million in FY21. The company held a P/B ratio of 8.8 and a D/E ratio of 0.21.
- Canopy Growth Corporation (TSX: WEED)
This drug manufacturing company is known for cultivating and selling recreational and medicinal cannabis and has earned distribution licenses in many countries. Canopy stood with a market cap of C$ 8.79 billion and a debt-to-equity (D/E) ratio of 0.41 on August 24.
The stock price closed at C$ 22.37 on August 24. On this day it traded roughly 69 per cent below its 52-week high of C$ 71.6 (February 10, 2021). The stock price dipped 26 per cent on a quarter-to-date (QTD) basis.
Canopy Growth posted net revenue of C$ 136 million in Q1 FY22, increasing 23 per cent YoY. Its Adjusted EBITDA loss was C$ 64 million in the same quarter.
Due to the widespread pandemic and global lockdown, international cannabis revenue declined by 26 per cent YoY. However, domestic recreational cannabis revenue increased by 35 per cent YoY.
The valuation metrics of the company highlighted a P/B ratio of 2.11.
- Organigram Holdings Inc. (TSX: OGI)
Organigram produces cannabis and cannabis-derived products with licenses to manufacture candy and soft-chew cannabis enabled in Canada. After launching its initial public offering (IPO) on November 24, 2011, the company went public on the Toronto Stock Exchange.
The company held a market cap of C$ 994 million and a D/E ratio of 0.37 (at the time of writing).
The stock price expanded by nearly 94 per cent over the past year and closed at C$ 3.33 on August 24.
As per a recent update, the company launched Edison JOLTS, a mint-flavored THC lozenge. This was an endeavor by the company to make available at an attractive price, a suitable ingestible option on the legal market
Organigram Holdings posted a net revenue of C$ 20.3 million in Q3 FY21, up 39 per cent quarter-on-quarter (QoQ).
- Cronos Group Inc. (TSX: CRON)
This C$ 3.09 billion market cap cannabis company exports medicinal cannabis to Germany and Poland. The investors of the company enjoyed a P/B ratio of 1.45 on August 24.
Over the past year, the stock price increased by nearly 15 per cent, and it closed at C$ 8.31 on August 24. It reached its 52-week high of C$ 20.08 on February 10, 2021.
Cronos Group posted a consolidated net revenue of US$ 15.62 million in Q2 FY21. Its adjusted EBITDA loss was nearly US$ 49.8 million in the same quarter.
The increased revenue was driven by the increased sale of cannabis in the Canadian market and Israeli medicinal cannabis market.
As some of these recreational and medicinal cannabis products are easily available in multiple locations, overconsumption of these products may be a risk factor.