The Highlights
Cannabis stocks started strong last week but faded on Friday. MSOS dropped 2.50% over the five sessions, while YOLO fell 1.73%. Ascend (CSE: AAWH, OTCQX: AAWH) rallied 12.18% following its debt refinancing, while Jushi (CSE: JUSH, OTCQX: JUSHF) lost the most at -9.84%. Ascend (CSE: AAWH, OTCQX: AAWH) announced on Monday it successfully refinanced its debt. The new senior secured notes were priced at 94.75% of face value, have a 12.7% interest rate, and are due in 2029. The net proceeds of the notes, together with cash on hand, will be used to prepay $215 million of principal amounts outstanding under its existing term loan. The cannabis rescheduling comment period ends on Monday, July 22. We are eager to find out if the DEA Administrator will grant a hearing and how long it will take to respond to comments. The elections are in 106 days and the Democratic National Convention begins in 28 days on August 19. While there is no specific timeline for a hearing or reviewing comments, we would not be surprised to see DEA Administrator Anne Milgram, a Biden appointee, do her best expedite the process. As is common in cannabis, we are again at the mercy of opaque political processes. On Monday, we learned that Ohio Senator J.D. Vance will be Trump’s running mate. Vance has historically backed states’ rights to set their own cannabis laws and has been against incarcerating people for minor cannabis crimes. However, he did vote against SAFER Banking and made the questionable claim that cannabis leads to more violence. Note that Vance’s SAFER objections were about a specific issue, and he does not appear to be broadly against the bill. This week on Higher Exchanges, we were joined by Hirsh Jain, Founder of Ananda Strategy, to review state-level catalysts. Jain shared his outlook for Ohio, Florida, Pennsylvania, and Minnesota. We also explored the potential TAM expansions driven by these adult-use flips. Jain also shared his thoughts on the “red wave” thesis and how more Republican states allowing adult-use cannabis could affect federal reform. Those interested can listen to the episode on Apple Podcasts, Spotify, and X Spaces.
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