With 2018 nearing its end, the Investing News Network (INN) is looking back on what stories caught the eyes of investors in the cannabis public space.
Companies and players in the cannabis market participated in a variety of developments that had a direct impact on the public stock market and the pockets of investors.
With that in mind. here INN brings investors a closer look into the top stories that caught the attention of our readers throughout 2018.
For a full recap of what 2018 looked like for the entire cannabis market, investors can read our 2018 cannabis trends of the year. Investors looking to see which stories caught the attention of the market last year can see our top five stories from 2017.
In July, major Canadian bank Toronto-Dominion (TD) Bank (TSX:TD) reversed course, at the time, on a negative sentiment on the marijuana market by adding 13 pot stocks to its list of approved companies to be recommended by financial advisors.
The complete list included only Toronto Stock Exchange (TSX) or TSX Venture Exchange (TSXV) stocks as it is policy for the bank and skipped Aurora Cannabis (NYSE:ACB,TSX:ACB) and Aphria (NYSE:APHA,TSX:APHA) due to the existing assets both companies still held related to the US cannabis market.
After a year full of speculation and projections, reality bit on the cannabis market in February when a massive market correction slashed prices for the overall public sector.
A January research note to investors from Canaccord Genuity had warned the fundamentals of these companies did not back up “the rapid share price increases that we have witnessed.”
As part of INN’s 2018 Trends look-back Brayden Sutton, CEO of 1933 Industries (CSE:TGIF,OTCQX:TGIFF) said the February correction was “overdue” in order to “keep valuations in check and avoid going further into bubble territory.”
As the Canadian cannabis market continues to mature, a variety of “firsts” took place. This includes the first time Health Canada, the regulatory agency for the industry in charge of licensing, announced it intends to revoke the federal license of licensed producer (LP) Agrima Botanicals, a subsidiary of Ascent Industries (CSE:ASNT).
“We haven’t seen this unprecedented move by Health Canada before,” Deepak Anand, vice president of business development and government relations with regulatory firm Cannabis Compliance, told INN in an email.
Ascent informed investors it will attempt to defend its license and “exercise its right to be heard under the Cannabis Act and Cannabis Regulations in order to maintain its licences.”
The executive team of Newstrike Resources (TSXV:HIP) — and in particular CEO Jay Wilgar — found themselves in a tricky situation following a proposed acquisition deal with at the time public LP CanniMed Therapeutics.
The deal seemed to make sense for both parties until Aurora Cannabis stepped in looking for an outright acquisition of CanniMed instead. After a formal offer was denied, Aurora pursued an aggressive takeover manoeuvre, which led to a deal finalized in April.
In the interview, Wilgar told INN about the turmoil from seeing the deal between the two LPs evolve and whether or not Newstrike was ever on the table for the full acquisition.
Speculation was a dominant point throughout the year and one of its biggest results was the share price increase for LP Tilray (NASDAQ:TLRY).
After it was reported alcohol producer Diageo (NYSE:DEO), was seeking a cannabis company to partner with, rumors spread as to which was in the running for a deal.
Doug Waterson, CFO and Portfolio Manager with Faircourt Asset Management and Manager of the Ninepoint UIT Alternative Health Fund, told INN he viewed a “significant portion” of the rush Tilray enjoyed was due to the speculation.
“[Tilray is] a quality name in the space and it would make a good partner for someone looking to enter [like a] beverage company,” Waterson said.
So far Diageo has not confirmed any deals with any cannabis companies.
Don’t forget to follow us @INN_Cannabis for real-time news updates!
Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Ascent Industries is a client of the Investing News Network. This article is not paid-for content.