Weekly Cannabis Commentary

Author: Sid Rajeev, Iftekhar Mahmud

Cannabis Industry Performance

Cannabis Industry Performance december 31, 2020

Source: TMX Money, FRC

 Over the past week, the Horizons Marijuana Life Sciences ETF (TSX: HMMJ / “HMMJ”), the Standard & Poor’s/MX International Cannabis Index (“MCAN”), and the Standard & Poor’s/TSX Cannabis Index (“XCAN”) generated returns of -4%, -4%, and -5%, respectively. There were no noteworthy developments in the industry in the past week.

Valuation of Select Canadian LPs

The following chart shows the average Enterprise Value to Revenue (“EV/R”) ratio of the Canadian cannabis companies we track.

Average EV/R (October 2019 – December 2020)

Source: S&P Capital IQ, FRC

The average EV/R, as of December 31, 2020, was 13.3x – a WoW decrease from 14.6x. The average EV/R, from October 7, 2019 to December 31, 2020, was 11.9x.

Source: S&P Capital IQ, FRC 

The average EV/R, as of December 31, 2020, was 13.3x – a WoW decrease from 14.6x. The average EV/R, from October 7, 2019 to December 31, 2020, was 11.9x.

Canadian Retail Cannabis Pricing as of 2021

Source: Online Provincial Cannabis Stores, FRC

 The average retail price per gram remained unchanged week-over-week at $11. The below chart shows Canadian retail dried cannabis flower pricing since we initiated price coverage.

Canadian Retail Dried Cannabis Flower Pricing

Source: Online Provincial Cannabis Stores, FRC

Canadian Retail Cannabis Stores

As of January 4, 2021, there are 1,421 retail cannabis stores, a week-over-week increase of 37 stores across Canada; all new stores came from B.C. We note that, due to the holidays, store count data was not updated on most provincial websites. We expect to get a more precise update next week.

Nationwide Store Count Dec 21 2020, Dec 28 2020, Jan 4 2021

Source: Online Provincial Cannabis Stores, FRC

Store count per geographic region

Source: Provincial Websites, FRC

Weekly Cannabis Commentary:

Source:https://www.researchfrc.com/weekly-cannabis-commentary-64