Hey Nerds: Blockchain
- Thread starter zeke
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Altair
Well-known member
Invest in cannabis they said.
Preston
MBow30 alt account
On the other hand, this does show the potential we have when the market becomes more mature, like Colorado. It's just really fucking hard to price in something you think has a good chance of happening in 5-10 years. But if Canada sells even close to this rate, the vast majority of these stocks are trading at pennies on the dollar. And the MSOs? Forget about it. Problem is you have to rely heavily on regulations to make any progress.
MindzEye
Wayward Ditch Pig
They never said to not sell....
Also, and this is a general life lesson, if you're not first or at most second in the door, be very careful. Anyone who "invested" (as in, passively put their money in a decent looking company) in fall 2017 is still up significantly right now.
- ACB is up over 100% since then
- Canopy is up almost 200%
- APHA is the dog of the big 3 and it's simply flat over that time period (though if you held APHA through their scandal, that's on you imo)
Anyone who saw the value proposition of the industry, put money in it, and managed their position even remotely intelligently since then is up significantly.
Preston
MBow30 alt account
When all is said and done, you may look dumb here. Lots of ebs and flows but seeing those Colorado numbers should make you bullish on cannabis, not bearish. This is how a mature market can perform. Explosive upside.
MindzEye
Wayward Ditch Pig
Oh, Canada will be a decent enough market when all is said and done. But instead of legalizing cannabis, the government think it's legalizing heroin or something similar, so the children must be protected, adults must not be too tempted to actually use the stuff, the provincial governments mustly tightly regulate where, when and how it's consumed, etc, etc, etc. All in proper Canadian fashion.
From an investors standpoint, it just means that any smaller company with explosive growth potential is dead in the water and for the larger companies, your shares are going to be so fucking diluted by the time they struggle to the finish line that you may as well have invested in another sector that was way safer, the additional gains just won't end up being worth the blood pressure spikes.
Thank fuck amateur hour is almost over. The Yanks understand how to keep the markets happy.
Altair
Well-known member
Shame if you invested last October when legalization happened.
Preston
MBow30 alt account
Cash is king right now. I worry about Aurora... Well I think both of us have for awhile. I know they're big boys but they're in real trouble. The smaller guys are fucked entirely. OGI might have a chance - seems like they're on track to pull in decent revenues this year and appear to be pretty efficient at the same time. APHA.. I wouldn't trust them with a ten foot fucking pole, but they've got the cash to weather this storm for now.
Basically Canopy and CRON are the only ones I see as locks to survive. But if you look at some MSOs.. GTII for example is on track to pull in 500 milly Canadian in revs next year as a conservative estimate with Illinois legalizing. Currently at a 2.5 billy market cap with SAFE, potentially Liz Warren, and NJ, NY, Florida, and PA legalization on the horizon. Also with a nice cash position and great relative strength compared to the rest of the sector. Now that's my top pick.
Preston
MBow30 alt account
Well investing after a pre-legalization pop would be the most amateur investment decision you could ever make. Sell the news was almost universally predicted and assumed. You joke about investing in cannabis, but I'm pretty sure ME, myself and CH have all made fucking bank in this sector. It's volatile like any speculative sector. Duh.
MindzEye
Wayward Ditch Pig
Sure, but also a shame if you invest at the top of any market anywhere, anytime.
But no one is forcing you to invest. Just stuff your money in a mutual fund and go about your business. Investing is risky. Not investing is riskier though. So if you choose to limit your risk, invest wisely, in industries and companies you understand and be diligent. Is there anything in life worth a fuck that someone completely uneducated and uninitiated can just jump in and be awesome at?
Altair
Well-known member
Oh, I'm sure you all did.
But I'm sure you all know that a bunch of amateur money entered the market shortly before legalization. Articles everywhere about how cannabis was about to take off in Canada. You guys here were going on about it as well about how well positioned the Canadian cannabis market was. Now I'm sure you all could make a killing in the midst of the great depression, but the average weed loving individual who thought the market was about to take off and put money in weed because who doesnt love weed, I laugh at those guys.
Preston
MBow30 alt account
The thing is... We didn't. I have to pump ME's tires here a bit.. He was looking into the US far before it was cool to do so. And those US companies have absolutely crushed it and are more than justifying their valuations. We all said we'd ride the hype on these Canadian names but at the end of the day the farmers don't often win. I agree that there are a lot of dumb people investing in the cannabis space that completely missed the mark. And I myself made my fair share of mistakes.. But I think you're missing the mark on thinking we expected the first year of legalization to be anything but disappointing. I have to thank CH and ME for reinforcing my thoughts and challenging me to question the euphoria or the despair; I think if you go back in this thread, our comments will mostly age incredibly well. Has rollout been worse than expected? Probably.. Mostly because of Doug Ford if we're being honest.. But I never expected those valuations to come close to being justified in year. We're still in the first inning here. Patience.
MindzEye
Wayward Ditch Pig
Yeah, things I was wrong about
- I wasn't bullish on Canada, but I didn't expect this level of horseshit from HC (marketing regs) and the provinces (what a horseshit retail rollout, fucking criminally inept, the greatest destroyer of shareholder value in this space right now imo). I was personally expected way more retail demand than we've seen so far and bigger first year revenues.
- I expected some fuckery (and called this the wild west on numerous occasions) but I expected it mostly from small and mid tier players, not the big ones. TRST & APHA specifically blind sided me. Namaste and Wayland level companies being greasy were expected, but if 18 months ago you had asked guys like the Cannalysts (the most by the book, financial statement oriented analysts in the industry imo) who their two favourite companies were, you would have been told TRST and APHA, hands down. They were the gold standard of corporate governance and operational integrity. It has turned out to be the opposite...biggest crooks in the room. Kind of shocking, and did tons of damage to the industry overall imo. There was a lot of forward looking "trust" propping up share prices and it died a horrific death after those two incidents happened.
- I expected Canopy to be competent farmers...jesus christ was I wrong. Bruce was a great cheerleader, terrible farmer.
- I wasn't bullish on Canada, but I didn't expect this level of horseshit from HC (marketing regs) and the provinces (what a horseshit retail rollout, fucking criminally inept, the greatest destroyer of shareholder value in this space right now imo). I was personally expected way more retail demand than we've seen so far and bigger first year revenues.
- I expected some fuckery (and called this the wild west on numerous occasions) but I expected it mostly from small and mid tier players, not the big ones. TRST & APHA specifically blind sided me. Namaste and Wayland level companies being greasy were expected, but if 18 months ago you had asked guys like the Cannalysts (the most by the book, financial statement oriented analysts in the industry imo) who their two favourite companies were, you would have been told TRST and APHA, hands down. They were the gold standard of corporate governance and operational integrity. It has turned out to be the opposite...biggest crooks in the room. Kind of shocking, and did tons of damage to the industry overall imo. There was a lot of forward looking "trust" propping up share prices and it died a horrific death after those two incidents happened.
- I expected Canopy to be competent farmers...jesus christ was I wrong. Bruce was a great cheerleader, terrible farmer.
Altair
Well-known member
As someone who doesn't play the market, I watch you guys, people I consider seasoned in investing versus the numbnuts in my personal life who jump in at bitcoin at 19000 or invest in weed in spetember 2018.
And for a long time there were times when the message was the same in both groups. Stock market down, but pot stocks doing well.
About halfway through the year, I believe, pot stocks started to get murdered and you guys started talking about it less and less which I took as you guys moving money out or to safer investments or just riding short term trends before bailing out again.
Meanwhile the numbnuts are holding on for dear life and a lot were bailing. Same numbnuts who said that it would be dumb not to invest in pot. I laugh at that daily. I'm sure you guys are fine though
Preston
MBow30 alt account
If you looked deeply enough, the red flags for APHA started in early 2018. I held them through the summer shitstorm and admittedly missed the red flags (bull bias will do that to ya). Luckily Canopy saved the day and I was able to sell in the 20's.
Rogers leaving TRST kickstarted my concerns but I never expected that shitstorm.
The worst case scenario happened really. You had a bunch of rich white people with egos thinking they can master growing weed in a short timeframe; it doesn't work like that.
As usual, the US has kicked Canada's ass and we're starting to see a clear separation on who the big players actually are down there. It was a little murky at first.. And a lot of companies are complete fucking trainwrecks too, but we're seeing a clear shift. CURA, Cresco, GTII have to be at the top at this point. These guys are all on track to do 500+ milly next year (CL and GTII with ~2.5 billy MC), with CURA potentially looking at a billy (5.7 billy MC). Light years ahead of Canada - we're barely doing a billy in cannabis sales as a whole country. TRUL has the revenues to weather the shitstorm quite nicely as well, even if I am skeptical about them longterm. They have Florida locked in.. And they may legalize recreationally verrrry soon. HARV is another one right there, but there are red flags that I'm personally not touching right now.
So for the most part, the APHA's of the world will have to rely on Canada's market growth with an outside shot at a US entrance - if Canada matures like Colorado did, they should be able to fucking rocket along with OGI and hell maybe even HEXO. Canopy already has an entry into the US so of course their valuation should be enormous. Plus having 2.5 billion in cash helps that - Currently at a 12b market cap. Of course, market caps don't mean shit when despair/euphoria is in the air. 50% haircuts for all would not shock me. But eventually, shit will change. Euphoria has never lasted forever; neither will this despair, as reasonable as it may seem.
Preston
MBow30 alt account
I started scaling into some positions in August (many of which have held up quite well). I'm playing with about 20% of my previous MJ profits - and even from that, I'm still heavily cash. I did some quick flips here and there for gains (and some for losses) and rebought lower on some and waiting it out on others. I'm down since August. No fucking doubt. But it isn't as brutal as it could have been and I'm not about to be shook from this until I see legit fundamental red flags from the stocks I hold.
CH1
The Artist Formerly Known as chiggins.
Marijuana just cemented Canada's well deserved reputation of being shit at building sustainable long term companies.
Such a disproportionate amount of blowups like RIMM, Nortel, Valeant, etc. It's sad.
Thank God for Shopify killing it. I still have hope for Canopy (but have yet to pull the trigger) because the Constellation group will bring some adults into the room.
In other news, Beyond Meat (BYND) looks like it's gonna fall off a cliff. I resisted shorting it until today, where I bought a few puts.
Such a disproportionate amount of blowups like RIMM, Nortel, Valeant, etc. It's sad.
Thank God for Shopify killing it. I still have hope for Canopy (but have yet to pull the trigger) because the Constellation group will bring some adults into the room.
In other news, Beyond Meat (BYND) looks like it's gonna fall off a cliff. I resisted shorting it until today, where I bought a few puts.