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1. I never fully appreciated how geographically biased investing in the cannabis sector is & how it colours our viewpoint. Cannabis isn't dead as an investment. Canada got it wrong, due to greedy suits & ineffective gov't, but the U.S. hasn't even started. It's 2015 on that side.
2. No doubt the U.S. has big hurdles & challenges, just as Canada had 4-5 years ago. The cheap founder paper of most big MSOs still has to churn. The SAFE Act has to pass the Senate, so capital can be accessed that isn't the predatory Bay St. stuff that's strangling CDN cos.
3. STATES Act will follow that. Or full decrim/legalization if DEMS win in 2020. But there are already cos. who know how to produce quality branded product in legal states & there will be an estimated $60-80B market that hasn't really formed yet.
4. Yes, it's essentially a commodity. But branded CPG is the American specialty. There will be few winners & many losers there, of course. Think FAANG. But it still has to go through it's boom & the much deeper Wall Street pockets still have to play the game.
5. I saw a comment on here where someone asked a respected guru with a massive following what he thought of $GTII. He said he didn't know who they were. As of last reported Q, they have 2x the sales of $APHA already. That was the point I realized the U.S. hasn't even started.
6. Once MSOs aren't primarily owned by CDN retail, off the CSE/OTC, have access to capital at non-predatory terms, & eventually stop paying the antiquated 280e tax, the U.S. cannabis market will start to reach the later innings. Right now, it's batting practice.
7. But they have to get there still & it's an uphill climb so being able to self-sustain in terrible market conditions is important. Like Canada, there are only 3 on the U.S. side that have positive EBITDA/Operating Income:
8. $TRUL, the sector leader by a wide margin in profitability, $PLTH, & $CXXI. That's it for U.S. cos. that trade in CAN as $CWEB just turned negative. On the OTC/U.S. side, you can add $MRMD (hemp), $GRWG (ancillary), $IIPR (RETI), the latter three not being pure cannabis plays.
9. $CURA, $CL, $GTII, $HARV are a few of the big boys, who are at varying stages of building out their flag-planting bonanza of not long ago. All are now signalling a focus on path to profitability, as access to capital at fair terms has gone dry.
10. It remains to be seen how the U.S. side of cannabis unfolds & how many hiccups there will be along the way. But for those screaming it's all over, remember, they likely don't even know who $GTII is./
