The marijuana sector in both Canada and the U.S. was a sea of red ink, with the ETFMG Alternative Harvest ETF MJ, -5.07% down 5.5% in Monday afternoon trading. The Horizons Marijuana Life Sciences Index ETF HMMJ, -4.03% was off 4.4% and its sister fund, the US Marijuana Index ETF, dropped 2.8%. Since the beginning of May, all the major cannabis exchange-traded funds are down more than 7%.
The world’s second largest cannabis company by market value, Aurora Cannabis Inc. ACB, -3.59% ACB, -4.09% said Monday that Radient Technologies Inc.RDDTF, +4.21% delivered its first batch of cannabis derivatives. According to Aurora, Radient’s technology is expected to be able to process about 300,000 kilograms of cannabis biomass at a single location. Aurora stock fell 4.5% in Monday trading.
Elsewhere in Canada, CannTrust Holdings Inc. CTST, -3.00% TRST, +0.38% said that it had completed a letter of intent with Canada’s second most populous province, Quebec, to deliver recreational cannabis. The company did not disclose the quantity it had agreed to supply. CannTrust was down 4% in Monday trading.
Canopy Growth Corp. CGC, -6.62% WEED, -6.53% fell 7.1%, Tilray Inc.TLRY, -6.19% was down 9.2%, Cronos Group Inc. CRON, -6.80% CRON, -6.10% fell nearly 8% and Aphria Inc. APHA, -4.71% APHA, -4.47% was down 7.1%.
This week is a significant one for cannabis sector earnings. Tilray and Aurora are both set to report earnings Tuesday after the closing bell, though Aurora’s conference call is expected Wednesday morning. CannTrust and Dutchman are also expected to report Tuesday.
Aleafia Health Inc. ALEAF, -5.26% reported first-quarter earnings Monday before the opening bell, logging losses of C$20.2 million — including a one time noncash payment related to its acquisition of Emblem Corp. — on revenue of C$1.5 million. Aleafia stock fell 5.3%.
Green Organic Dutchman Holdings Ltd. TGOD, -2.76% , TGODF, -3.70% which has not yet sold any recreational cannabis in Canada, signed a distribution agreement for one of its cannabidiol, or CBD, brands for the German pharmacy market. Dutchman stock was down 4.6%.
In the U.S., Acreage Holdings Inc. ACRGF, -6.66% said Monday that it was selling its real-estate assets to a real-estate investment trust that had been recently formed. Canopy Growth last month purchased the right to acquire Acreage upon federal cannabis legalization in the U.S. The investment trust called GreenAcreage Real Estate Corp. will buy the assets and lease them back to Acreage under the deal. The investment trust will be run by GreenAcreage Management, in which Acreage holds a 20% stake.
Cowen analyst Vivien Azer initiated research coverage of Greenlane Holdings Inc.GNLN, -4.24% , which recently went public on the Nasdaq. Azer rates the company the equivalent of a buy and has a $21 target price. Greenlane went public at $17 a share but closed Friday at $16.25 and was down 5.3% in Monday trading.
In the note to clients Monday, Azer wrote that the current share price represents an “attractive entry point” given the company’s “prospects for robust revenue growth and profitability.”
The ETFMG Alternative Harvest ETF (MJ) was trading at $32.59 per share on Monday afternoon, down $1.71 (-4.99%). Year-to-date, MJ has gained 0.20%, versus a 5.86% rise in the benchmark S&P 500 index during the same period.
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