Weekly Cannabis Commentary

Cannabis Industry Performance

Cannabis Industry Performance

Source: FRC

Last week, U.S. cannabis stocks outperformed Canadian stocks as Ohio lawmakers introduced a bill to legalize recreational cannabis, while Mississippi lawmakers submitted a draft proposal for medical marijuana legalization.

Valuation

As of August 3, 2021, the Canadian big four LPs were trading at an 87% premium (down from 94% in the previous week) over their U.S. peers. We continue to believe the valuation gap will diminish as the U.S. moves closer to federal legalization.

Source: S&P Capital IQ, FRC

The following chart shows the average EV/R of the companies we track in both countries:

Average EV/R

Source: S&P Capital IQ, FRC

 

Canadian Retail Cannabis Pricing

Source: Online Provincial Cannabis Stores, FRC

The average retail price per gram fell week-over-week from $11.19 to $11.16. The chart below shows the Canadian retail dried cannabis flower pricing trend:

Canadian Retail Dried Cannabis Flower Pricing

Source: Online Provincial Cannabis Stores, FRC

Canadian Retail Cannabis Stores

As of August 3, 2021, there are 2,354 retail cannabis stores, a WoW increase of three stores across Canada. We are noticing a decline in weekly new openings, especially after news of declining margins of retailers in ON amid rising competition. Based on a population to store ratio, we believe there is room for at least 1,500 more stores across the country.

Nationwide Store Count

Source: Provincial Websites, FRC

Source: Provincial Websites, FRC

Weekly Psychedelic Commentary

Psychedelic Industry Performance

Psychedelic Industry Performance

Source: TMX Money, FRC

Weekly Cannabis Commentary:

Source:https://www.researchfrc.com/weekly-cannabis-commentary-95