Buds & Duds: Cannabis stocks tumble led by mixed 3Q earnings from Aphria

Cannabis stocks had a door-in-the-face abrupt start to Monday with broad drops across the board, led by behemouth Aphria Inc (NYSE:APHA), which swung to a wide loss in its third-quarter financial results, despite a huge boost in revenue. 

The North American Marijuana Index, which tracks the top cannabis stocks in the US and Canada, was down almost 13% to 295.13. The Horizons Marijuana Life Sciences Index ETF was up 0.4% at C$20.82.

Duds

Aphria Inc (TSE:APHA) (NYSE:APHA) was the talk of the town Monday after the Canadian producer swung to a loss in its fiscal third-quarter despite posting sharply higher revenue.

Shares were down 12.1% at C$ 11.79 in Toronto and slid 12.8% at US$8.81 in New York. 

READ: Aphria shares dip after cannabis producer swings to fiscal 3Q loss

Its net loss for the three months to February 28 came to C$108.2 million (US$81.1 million) or C$0.43 per share, down from a profit of C$12.9 million (US$9.69 million), or C$0.08 per share, in the year-ago quarter. Its bottom-line took a hit from a $50 million charge related to its Latin American assets.

Its net revenue, meanwhile, climbed to $73.6 million, jumping more than sevenfold from $10.27 million in the year-ago quarter.

The Ontario company also posted a decline in the number of kilograms of cannabis sold in the quarter to 2,636.5 from 3,408.9, despite its average selling price rising to C$8.03 per gram from C$7.51 per gram due to higher cannabis oil sales.

Other laggards Monday included Cronos Group Inc (NASDAQ:CRON) (TSE:CRON), which sank 7.1% at  C$21.07 in Toronto and down 8.1% at US$15.66 in New York. 

Cronos has been dogged by disappointing earnings released a few weeks ago which missed expectations, alongside a host of analyst downgrades. The stock has dropped around 20% since the start of 2019. 

Other decliners included Aleafia Health Inc (OTSMKTS:ALEAF) (CVE:ALEF), which was down 7.1% at US$1.16 in New York and down 6.5% at C$1.57 in Toronto. 

Buds

Valens GroWorks Corp (CSE:VGW) (OTCMKTS:VGWCF) bucked the trend on Monday, with shares up 2.9% at C$3.56 in Toronto and up 2% at C$2.66 in New York. 

Last week, the Kelowna-based company announced it had raised a substantial $43 million to expand its geographic presence and increase production capacity. Valens has extraction processing and supply agreements with a number of leading producers across Canada. 

WATCH: Valens GroWorks raises over 43 million dollars to grow expansion

Chemistree Technology Inc (CSE:CHM) (OTCMKTS:CHMJF) saw shares jump on Monday as it announced a partnership to potentially expand its presence outside California and Washington state.

The cannabis-focused investment group said its US subsidiary, American CHM Investments Inc, has signed a letter of intent (LOI) to partner with Applied Cannabis Sciences of New Jersey (ACS).

Shares were up 5.1% at C$0.62 in Toronto and up 6.5% at C$0.45 in New York. 

READ: Chemistree Technology shares advance as it sets to partner with Applied Cannabis Sciences of New Jersey

Other gainers on Monday included Golden Leaf Holdings Ltd (CSE:GLH) (OTCQB:GLDFF), with shares up 4.5% at C$0.12 in Toronto. 

Contact Katie Lewis at [email protected]

Story by ProactiveInvestors