Not a lot has changed since last week’s issue—overall, the cannabis sector remains in a correction—but there are a few stocks worthy of an update.
First, there are some stocks hitting new lows, which is not good.
Cresco Labs (CRLBF) is one of these stocks. We sold half our position in Cresco last week, as the stock looked vulnerable in a cash crunch, and yesterday the company announced a new dilutive equity distribution agreement. We’ve now taken profits in the stock three times this year, so we can afford to hang on a little longer and wait for a year-end bounce, but if you’re not in the same boat, selling may be the best course.
Another stock hitting new lows is MariMed (MRMD), the lowest-priced stock in the portfolio and our biggest loss today. Sure, it’s tempting to hang on for a year-end bounce, but experience says selling and moving on is wiser. SELL.
On the positive side, there are clear signs of growing support in a few stocks, the most notable of which is Trulieve (TCNNF).
Best prospects for new investment going forward look to be Aphria (APHA), Curaleaf (CURLF), Green Thumb Industries (GTBIF), Innovative Industrial Properties (IIPR), MediPharm Labs (MEDIF) and Turning Point Brands (TPB)—but there’s no reason to rush. I’ll be watching the action as December unfolds and keeping you informed of the best prospects for a 2020 rebound.
As for Trulieve (TCNNF), if you got in on my original recommendation, you now have a quick profit of 30%, and you should consider some taking partial profits, recognizing that it’s very difficult for a stock to swim against the tide of the sector for long. Long-term prospects for the stock, of course, remain bright, and I’m still looking for an opportunity to average up.