These Pot Stocks Went Wild This Week

HEXO Corp and High Tide both got legal red flags thrown at them this week

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Welcome back to our weekly series, Schaeffer's Cannabis Stock News Update, where we recap what happened in the world of marijuana stocks, and look at how the cannabis industry is shaping up as we kick off 2022. The world of cannabis saw massive growth in 2021 and 18 states plus D.C. officially legalized the adult-use of cannabis by the end of the year. Thirty-one states plus D.C. had taken decriminalization measures regarding cannabis by the end of 2021. As of late 2021, marijuana is classified at the U.S. federal level as a Schedule I substance  under the Controlled Substances Act. In other words, cultivating, distributing, and possessing cannabis remains illegal at the federal level.

In addition, here is a quick summary of the major (and action-worthy!) cannabis stock news from this week:

To kick off the final day of January 2022, GrowGeneration Corp. (NASDAQ:GRWG) announced its acquisition of  Horticultural Rep Group. As part of the acquisition plan, Keith Harrington, the founder and president of HRG, will transition to GRWG's SVP of Business Development. According to GrowGeneration's president, "Keith Harrington is one of the most respected executives and one of the early innovators of the U.S. modern horticultural market. We are excited that he will contribute his multi-decade expertise to the GrowGen team."

Evogene Ltd. (NASDAQ:EVGN) subsidiary, Canonic Ltd. confirmed the shipment of its first batch of unique cannabis varieties to Portugal on Monday. This shipment couldn't previously take place until the Israeli Ministry of Health and Ministry of Agriculture provided approval to export. EVGN has a major 2023 commercial launch planned for European countries and this shipment is a major benchmark in those plans. 

Nasdaq threw a compliance red flag at HEXO Corp (NASDAQ:HEXO) on Monday, indicating that HEXO is not currently in compliance with the minimum bid price requirement in Nasdaq Listing Rule 5500(a)(2) for continued listing. HEXO common shares' closing bid price has been below $1.00 for 30 consecutive trading days, breaking the cited Nasdaq listing rule. While HEXO stock will experience no immediate impact, the company has 180 calendar days to regain compliance. Then, just a few days later, one of HEXO's shareholders announced plans for a hostile takeover including the nomination of five new board members. The shareholder's battle with HEXO management started when he claims that HEXO acquired Redecan using deceptive practices that should never have been approved by the board.

Greenlane Holdings, Inc. (NASDAQ:GNLN) released its preliminary results from fourth quarter of full-year of 2021 on Monday. The pivotal highlight for GNLN in 2021 was its KushCo merger back in August. Greenlane delivered a 54% increase in net sales attributed primarily to Greenlane Brands product sales.

 

Jumping straight into February, Scotts Miracle-Gro Company (NYSE:SMG) released its fiscal fourth quarter financial results that showcased profitable territory in the U.S consumer segment for the second time ever. However, overall sales dropped 24% year-over-year. Along with SMG's earnings announcement, the company noted plans to restructure Hawthorne, its hydroponic subsidiary in an effort to appeal to investors seeking cannabis companies. In an effort to support this major move into the cannabis market, Scotts Miraccle-Gro has allocated about $200 million to use toward strategic acquisitions this year.

Canopy Growth Corporation (NASDAQ:CGC) subsidiary, BioSteel Sports Nutrition Inc., announced a handful of retail deals on Tuesday resulting in BioSteel Sports Nutrition drinks being available at approximately 15,000 stores in the U.S. The Clean. Healthy. Hydration. drink lineup will hit shelves at major retailers right away. Subsequently, on Thursday, Canopy Growth launched two new beverages and hard candy under its Ace Valley brand portfolio.

PepsiCo, Inc. (NASDAQ:PEP) avoided all the legal red tape of THC- and CBD-infused beverages by launch a hemp-infused beverage line called Rockstar Unplugged on the first of February. While most consumers of energy drinks are younger men, this new PepsiCo beverage is designed to attract young women. According to PEP, ″[Hemp seed] doesn’t have any functionality, it comes from an herb. Imagine you’re drinking an herbal tea, with caffeine. That’s it.”

On Tuesday, The Valens Company (NASDAQ:VLNS) announced that the company's virtual Investor Day will be held on February 7 at 11:00 a.m. ET. Valens' senior leadership team plans to discuss 2022 opportunities as well as updating investors on current progress of existing initiatives.

High Tide Inc. (NASDAQ:HITI) missed the January 31 deadline to file audited financial statements for fiscal 2021 and 2020. According to HITI, the missed deadline is a result of ongoing pandemic-related personnel shortages. However, by February 3, High Tide confirmed the completion of submitting its audited annual financial statements to bring the cannabis company back in good standing with the securities commission and exchanges, as well as avoiding regulatory sanctions.

WM Technology, Inc. (NASDAQ:MAPS) announced on Tuesday that the cannabis tech company will release its fourth quarter of 2021 financial results on Wednesday, Feb. 23, after the market closes.

Aurora Cannabis Inc. (NASDAQ:ACB) announced on Tuesday that the cannabis company will release its second quarter of fiscal 2022 financial results on Thursday, Feb. 10, after the market closes. Later in the week, on Thursday, Aurora launched a new CBD product line named KG7 to be sold online and in convenience stores in the U.S. According to ACB, "As part of Reliva's portfolio expansion strategy, KG7 extends our brand into additional CBD market segments. With this product line, we expect to solidify Reliva's position as the #1 CBD brand in brick and mortar channels."

On Wednesday, Agrify Corporation (NASDAQ:AGFY) acquired Lab Society, a major player in the cannabis extraction industry. According to Agrify's CEO, "As federal legalization edges closer to reality, we believe the United States government will likely increase its role in setting the quality, consistency, and safety standards for medical and recreational cannabis products. By owning the top key solutions that produce the highest quality and the widest range of extracted cannabis products at scale, we expect it will provide Agrify with a significant competitive differentiation, enhanced customer value-add, superior industry leadership position and significant growth opportunities globally.”

Meanwhile, Flora Growth Corp. (NASDAQ:FLGC) is anxiously awaiting approval from the Colombian FDA to kickoff studies on FLGC's patent-pending cannabinoid that has the potential to display viral inhibition. The purpose of these studies it to evaluate the potential for cannabinoids to prevent infection from the SARS-CoV-2 virus.

22nd Century Group, Inc. (NASDAQ:XXII) announced on Thursday that the cannabis biotechnology company will release its fourth quarter and full-year of 2021 financial results before the market opens on Tuesday, March 1

Neptune Wellness Solutions Inc. (NASDAQ:NEPT) announced on Friday that the cannabis company will release its third quarter of fiscal 2022 financial results before the market opens on Thursday, Feb. 10

*NEW CANNABIS STOCK ALERT* Silver Spike Investment Corp. (NASDAQ:SSIC), a cannabis-centric financing company, began trading on the Nasdaq on Friday, Feb. 4 after pricing its initial public offering (IPO) at $14.00 per share.

Dr. Reddy's Laboratories Ltd. (NYSE:RDY) confirmed Friday that it is acquiring German medical marijuana pharmaceutical brand, Nimbus Health GmbH. According to Dr. Reddy's, "With numerous studies being conducted to leverage and introduce medical cannabis, we believe this is a must-be field for future healthcare delivery. We are very excited that with Nimbus joining Dr. Reddy's family, together with Linus and Alessandro, we embark on a new, exciting journey of medical cannabis, which supports Dr. Reddy's mission of meeting unmet patient needs."

 
 

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