The Highlights
The US cannabis MSOS ETF drifted 1.84% lower, while the global YOLO ETF slid 0.54%. Absent meaningful news, cannabis stocks are being pressured while we wait for the 60-day comment period on the proposed rule to reschedule cannabis. Most of the larger MSOs were down last week, with MariMed (CSE: MRMD, OTCQX: MRMD) at -10.46% and Cannabist (NEO: CBST, OTCQX: CBSTF) at -8.06% losing the most. Verano (NEO: VRNO, OTCQX: VRNOF) and Green Thumb Industries (CSE: GTII, OTCQX: GTBIF) were among the bright spots, up 1.70% and 0.97%, respectively. Grown Rogue (CSE: GRIN, OTCQX: GRUSF) reported record 1Q24 revenue of $6.7 million and adjusted EBITDA of $2.4 million. The company is expanding from its core markets of Oregon and Michigan and confirmed New Jersey sales are on schedule for 2H24, while Illinois is on track for 2H25. Grown Rogue is +136.67% YTD. Vext (CSE: VEXT, OTCQX: VEXTF) reported weaker 1Q24 results, with a soft Arizona environment driving lower revenue and adjusted EBITDA. The company is well positioned to benefit from Ohio opening for adult-use, with four stores, and a Tier 1 25,000-square-foot grow (can expand to 50,000 square feet). Tier 1 grows allow operators to open three more doors, which would take Vext to seven Ohio stores. Cansortium (CSE: TIUM, OTCQX: CNTMF) and RIV Capital (CSE: RIV, OTCQX: CNPOF) announced they are merging. Shareholders of RIV will receive 1.245 of each common share of Cansortium for each RIV share. RIV will benefit from Cansortium’s strong presence in Florida (35 stores and ~153,000 square feet of cultivation) and Pennsylvania (three stores). The combined company has a pro forma cash balance of approximately $74 million (largely due to RIV’s $65.8 million in cash as of March 2024) to fuel future growth. Mindset Capital CEO Aaron Edelheit joined us for an X Spaces interview on the growth low-dose, hemp-derived beverages. Those interested can read the update note on the interview and listen to the recording via links accessible in our full report. This week on Higher Exchanges, Morgan Paxhia joined us to discuss opportunities in Ohio and potential changes to the farm bill. Those interested can listen to the episode on Apple Podcasts, Spotify, or X Spaces. Links available in our full report.
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