If you have heard of $TLRY then you have heard of the exponential growth available in the cannabis/pot sector. The whole arena is just blossoming with opportunity.
Has the chance to invest passed you by snd you missed it? Probably not, but for TLRY it needs to come back to reality.
TLRY is the first cannabis grower that was listed on the US stock exchanges. Not only being the first but such a small public float made its valuation sky rocket. There are roughly 17 million shares available to be traded by the public.
If you have followed my blog posts in the past then you know that the low floats have potential to run from 17 to 300 in a couple weeks. As the demand grows so does the price. However as quickly as it goes up it can drop. In fact it webt from 150–>300–150 all in one day. When those major swings are happening its best to trade cautiously with a smaller position.
Does it mean since TLRY is on the way down from its parabolic move like Bitcoin to 20,000 that the sector lost its lustre. In my opinion the sector growth is not done, but Tilrays momentum move is over for the moment.
In fact I have a good 30% in my 401k in the cannabis sector diversified through different holdings. Some value that I see are the Hemp producing companies that then generate CBD for pharmaceutical companies.
The pharma companies or other partnerships then use the CBD oil for health benefits such as pain management, seizure prevention, cancer treatment and more.
Two of the companies I hold that I think have good longer term growth potential are HEMP on the US exchange and ACBFF. HEMP has one of the biggest Hemp processing facilities in the US and the have a Hemp University where they teach farmers about how they cab farm Hemp for profits.
ACBFF is also known as Aurora and they are a Canadian company. They are also big into the CBD production and have a global vision with their market. The reason why CBD can have a bigger reach globally is due to the fact it is legal in more locations than the THC ingredient of Pot. So the CBD partnership potebtial with a beverage company on the horizon could really cause massive growth. The CEO recently did an interview expressing that the comosny has spoken with 3 companies one of which is Coca Cola. No partnersgips signed yet, but one is in the horizon. They are also looking to potentially have a US IPO to come off the pink sheets in the next coming months.
These are just two in the big arena of Cannabis. Another third that just had their uplisting to the US exchanges from pink sheets is CGC or Canopy Growth. Since they had their uplisting they doubled in value as well.
The big day for the Cabadian companies is the first day of legalization in Canada of October 17, 2018. Will the value growth continue after this date? I think that it will, but the hype is definitely driving the stocks up now.
Is it too late to invest? In my opinion I think there is value underlying in the stocks mentioned above, however the ones that have more than doubled have high risk involved.
When a stock like TLRY opens at 17 and then becomes more valuable than 75% of the S&P and is traded at roughly 500 the earnings of the company it makes you wonder?
There are other blue chip stocks out there trading with high PE ratios, but 500-700 is a bit inflated for me. I prefer to stick with the ones where the growth potential is in the horizon instead of explosive move missed.
As always remember to trade with proper risk management and do your due diligence so as to nit get burned like those that bought TLRY at 300.
Other Cannabis Stocks that could be interesting
APHQF – Aphria
CGC- Canopy Growth
EVIO – Evio Labs
OGRMF – Organigram
SPRWF – Supreme Cannabis
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