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Buddies,

As we recommended in our Sunday newsletter final weekend, “7 Important Queries for Cannabis Firms Throughout Earnings Season“, we count on to discover a excellent deal from publicly traded cannabis businesses this earnings season, and we have been a bit shocked this week to see the update from CV Sciences depict the CBD industry in such disarray. The corporation reported a 25% decline year-more than-year in sales. This follows weak outcomes from competitor Elixinol Worldwide for the quarter as effectively.

Although we have been cautious on the CBD space, as shared privately 3 months ago to subscribers of 420 Investor, the scenario is apparently worse than we had anticipated. CV Sciences CEO Joe Dowling explained on the conference get in touch with that competitors has intensified drastically in the organic item space, with far more than 1000 new brands competing for shelf space. He pointed to low high quality merchandise with misleading marketing and advertising efforts and labeling crowding the shelves and making buyer confusion.

Readers are probably familiar with the moves created by lots of meals, drug and mass industry retailers to enter the space, but most of these shops are focused solely on topical merchandise due to FDA regulatory concern. These merchandise do not have the exact same customer usage intensity as the far more classic ingestible merchandise and are not but contributing drastically to prime-line development.

We continue to see the media frequently reporting the disappointment of farmers expanding hemp. They are locating it complicated to obtain purchasers and face reduced rates than they anticipated. Litigation abounds, as effectively, with numerous situations of rampant fraud, which includes some businesses that have allegedly sold terrible seeds. A single significant processor has been sued by contractors for failure to make payments on building. For considerably of the provide chain, reality is not living up to the hemp hype.

Although Congress legalized hemp far more than a year ago, the regulatory atmosphere is fairly uncertain. At the federal level, progress has been created, with the USDA not too long ago establishing the U.S Domestic Hemp Production Plan, but the FDA hasn’t but finalized its regulatory oversight more than CBD merchandise. We assume that after the FDA has performed so, the market is probably to move forward swiftly. The new retailers of CBD merchandise, initially focused on just topical merchandise, will be in a position to add ingestible merchandise most probably, operating with a restricted quantity of higher high quality producers. On top of that, FDA accountability is probably to kill off the fly-by-evening operators who have entered the space. In addition to complying with the federal regulatory landscape, CBD producers will require to comply with separate state-level regulations, lots of of which haven’t but been finalized. In our view, the industry will enhance considerably after there is regulatory clarity.

This week will see even far more cannabis businesses reporting, which includes Charlotte’s Net, the leader in the CBD space, so we appear forward to hearing how it has been faring in the “Wild West” that has created because the Farm Act became law. Various analysts reduce their estimates for the corporation following the CV Sciences earnings release, but none count on sales to decline, as they did for CV Sciences and Elixinol, from the $25 million reported in Q3.

As a reminder, we deliver our readers with a comprehensive  Cannabis Earnings Conference Get in touch with Calendar of all of the businesses hosting conference calls, as effectively as what has grow to be an market benchmark for investors, the professionally managed Public Cannabis Firm Income & Earnings Tracker.


Aurora Cannabis, 1 of the largest operators currently within 25 international nations and across 5 continents, continues to track towards constructive EBITDA. The corporation has shifted gears just after closing 17 strategic acquisitions to a higher concentrate on profitability. Benefiting from economies of scale, Aurora’s vision is to define the future of cannabis globally, and it is executing that by developing new merchandise to industry such as soft-gel capsules, sprays, hemp  oil tinctures, pre-rolls and far more. With the advent of new cannabis formats, the Aurora of right now is fairly distinct from the 1 a year or two ago. As we strategy the company’s earnings report, be confident to keep tuned for Aurora’s conference get in touch with on 11/14 at six PM ET.

Get up to speed by visiting the Aurora Cannabis Investor Dashboard that we keep on their behalf as a client of New Cannabis Ventures. Click the blue Stick to Firm button in order to keep up to date with their progress.


New Cannabis Ventures publishes curated articles as effectively as exclusive news. Right here is some of the most exciting company content material from this week:


To get actual-time updates download our cost-free mobile app for Android or Apple devices, like our Facebook page, or stick to Alan on Twitter. Share and learn market news with like-minded persons on the biggest cannabis investor and entrepreneur group on LinkedIn.

Get ahead of the crowd! If you are a cannabis investor and obtain worth in our Sunday newsletters, subscribe to 420 Investor, Alan’s complete stock due diligence platform because 2013. Achieve quick access to actual-time and in-depth facts and industry intelligence about the publicly traded cannabis sector, which includes day-to-day videos, weekly chats, model portfolios, a neighborhood forum and considerably far more.

Use the suite of professionally managed NCV Cannabis Stock Indices to monitor the overall performance of publicly-traded cannabis businesses inside the day or more than longer time-frames. In addition to the complete Worldwide Cannabis Stock Index, we offer you a loved ones of indices to track Canadian licensed producers as effectively as the American Cannabis Operator Index.

View the Public Cannabis Firm Income & Earnings Tracker, which ranks the prime income making cannabis stocks that create market sales of far more than US$7.5M per quarter.

Keep on prime of some of the most essential communications from public businesses by viewing upcoming  cannabis investor earnings conference calls.

Find out upcoming new listings with the curated  Cannabis Stock IPOs and New Challenges Tracker.

Locate your spot in the cannabis industry by going to our Careers and Jobs Page and discover which businesses are hiring aggressively.

Sincerely,
Alan & Joel

Alan Brochstein, CFA
Primarily based in Houston, Alan leverages his expertise as founder of on-line communities 420 Investor, the 1st and nonetheless biggest due diligence platform focused on the publicly-traded stocks in the cannabis market. With his comprehensive network in the cannabis neighborhood, Alan continues to obtain new methods to connect the market and facilitate its sustainable development. At New Cannabis Ventures, he is accountable for content material improvement and strategic alliances. Just before shifting his concentrate to the cannabis market in early 2013, Alan, who started his profession on Wall Street in 1986, worked as an independent investigation analyst following more than two decades in investigation and portfolio management. A prolific writer, with more than 650 articles published because 2007 at In search of Alpha, exactly where he has 70,000 followers, Alan is a frequent speaker at market conferences and a frequent supply to the media, which includes the NY Instances, the Wall Street Journal, Fox Organization, and Bloomberg Television. Speak to Alan: Twitter | Facebook | LinkedIn | E mail

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