Cannabis investors should watch Canadian polling data
We are watching the Canadian polling results very carefully ahead of the October 21, 2019 federal election. As I reported here in the February 22, 2019 letter, the Liberals are languishing and that has continued as the chart above shows. The latest standings reflected in the graph below show the Official Opposition Conservatives (in blue) have risen and taken over the lead with 35.6% of the popular vote, while the incumbent Liberals (in red) have fallen and are now ensconced in second place with 32.3% and the NDP (in orange) a distant third with 15.7%. The Liberal’s sagging fortunes have nothing to do with cannabis but have everything to do with how the Canadian cannabis industry might look from 2019 to 2023. The polling data is from the CBC that averages the results of the major polling done across Canada.
As I explained in more detail in February, the Conservatives ran on a platform that was almost fanatically anti-cannabis and one term in opposition probably has not altered that culture. Although the cannabis genie is out of the bottle and can’t be put back in, a Conservative government could certainly impede the progress of the domestic industry.
For some time now, we have urged readers to focus portfolios on companies with non-Canadian operations. In The Cannabis Report Model Portfolio that I manage for Investor’s Hub, I have reduced Canadian based operators to 12.6% of the portfolio (Organigram and Canopy Growth) with no allowance for the fact that both of these companies have important operations and assets outside of Canada along with their significant major assets in Canada. The message at this point is if you are reading the Let’s Toke Business newsletter or following The Cannabis Report Model Portfolio and, for some reason, you haven’t acted on 1933 Industries (CSE: TGIF), Khiron Life Sciences (TSXV: KHRN), Lexaria Bioscience (CSE: LXX) (OTCQX: LXRP) or Sunniva (CSX: SNN), this is not a good time to procrastinate.