BROCHSTEIN: Canadian Cannabis stocks trading at massive volumes

In New Cannabis Ventures, Alan Brochstein points out the relatively high level of trading in Canadian cannabis stocks listed on the NYSE and the NASDAQ. First, however, Brochstein notes the massive volume of trading in Aphria (TSX: APH), Aurora (TSX: ACB) and Canopy Growth (TSX: WEED). All three traded over $250 million worth of shares on Friday August 24, 2018 and Canopy Growth averaged almost $650 million per day. This was on the Canadian markets alone.

But for Canopy Growth (NYSE: CGC), Cronos Group (NASDAQ: CRON) and Tilray (NASDAQ: TLRY) trading in the U.S. was even more remarkable. Last week, CGC and CRON which are also listed in Canada, traded more value in the U.S. On Friday, these three stocks traded over U.S. $1.8 billion with CGC accounting for over U.S. $1 billion. Activity was fuelled by rumours that Diageo, a UK company that refers to itself as the largest maker of spirits in the world, was in discussions with three Canadian cannabis companies. This would be another blockbuster deal as Diageo sports such brands as Smirnoff vodka, Gordon’s gin and Captain Morgan rum.

Brochstein sees a number of additional Canadian cannabis companies seeking listing on the U.S. exchanges. He says, “To summarize, U.S. investors appear to be piling into a small group of cannabis companies that we expect to get larger in the near future.” We certainly agree and this is another difference that is new this time around and could push the overall recovery above last year’s rally.