It was a tumultous Tuesday for cannabis stocks across North America, with most US and Canadian cannabis stocks dropping across the board.
Much of the drop came shortly after attorney general nominee William Barr said that the current system around marijuana laws is 'untenable' and he personally supports prohibiting marijuana across the US. He did say that he would not "go after" marijuana companies in states allowing cannabis use.
The North American Marijuana Index, which tracks the leading cannabis stocks in the US and Canada, fell 3.2% to close at 257.95.
Shares of Lexaria Bioscience were up 8.3% at C$1.82. The company said the partnership will focus on using Lexaria's Bioscience's proprietary DehydraTECH™ platform, which allows cannabidiol (CBD) and other oils to be dehydrated into an odorless, tasteless powder.
READ: Lexaria Bioscience inks deal with Altria Ventures to develop reduced-risk nicotine products; shares soar
Aurora Cannabis Inc (NYSE:ACB) (CVE:ACB) pushed 2.9% higher to hit C$9.26 on the heels of its announcement at the week’s start that it aims to broaden its offerings with the takeover of privately-held Whistler Medical Marijuana.
The Whistler label will be added to the Edmonton, Alberta-based company’s line-up of brands, which already include AltaVie and San Rafael ’71. Aurora’s management has signed a letter of intent to acquire all issued and outstanding shares of Whistler in an all-share transaction valued at as much as C$175 million.
The deal will allow the rapid production of its proprietary cannabis in California.
Under the deal, Intrexon will be entitled to royalties on Next Green Wave's own plantlet use, and the parties will share the revenue from third-party sales.
Next Green Wave shares jumped 12% at C$0.65 in Toronto and Intrexon shares were up 5% at US$8.23 on the Nasdaq.
There were far more duds than buds on Tuesday.
Ranking high on the list of laggards, shares in Tilray Inc (NASDAQ:TLRY) took a dive of nearly 17% to US$82.88 due to its lock-up period expiring, which allows executives and other early investors to sell their stock. The Canadian cannabis company also announced that it has reached a deal with Authentic Brands Group to develop and market consumer cannabis brands around the world. The deal with Authentic is a revenue-sharing agreement, with Tilray supplying various cannabis-based products to be sold through Authentic’s distribution channels. In exchange, Tilray will initially pay Authentic US$100 million and up to US$250 million in cash and stock, subject to the achievement of certain commercial milestones and regulations.
Cronos Group (NASDAQ:CRON) was also taking something of a beating, trading 5% lower at $13.05. After rising by more than 30% last year, analysts are starting to question whether the company’s stock, which benefited from the tobacco giant Altria recently paying $1.8 billion for a 45% stake, will continue its rise in 2019.
Last but never least, KushCo Holdings Inc (OTCMKTS:KSHB), the marijuana packaging company, dropped 15% to $5.96. The company was not feeling the love from investors after finishing the first quarter with only $3 million in cash, a drop from the $13.5 million it was sitting on in the previous reporting period, according to published reports.