Cannabis Stocks on the CSE25 Index
Officially launched last year, the CSE25 Index is meant to track the largest companies on the Canadian Securities Exchange (CSE).
The dominance of cannabis-related companies atop the index shows an overall interest in these stocks throughout the entire exchange.
Since its launch, marijuana stocks or those related to the industry have continued to lead this index. The CSE25 Index is a subset of the CSE Composite Index, which currently holds 203 companies.
The CSE has earned a reputation of hosting cannabis stocks with interests in the US market, unlike its fellow Canadian exchanges, the Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV).
The TSX and TSXV have actively warned companies against holding any assets in the US due to the illegal status of the drug at a federal level.
Due to this restriction, the CSE has offered a home to some companies looking to raise capital in Canada and offer investors exposure to the booming market below the border.
Here the Investing News Network (INN) offers a closer look at the top-weighing companies in the index. The weight of these companies in the index is current as of the CSE list on April 20. The companies below are listed in order from top weighted.
Namaste Technologies (CSE:N)
Namaste Technologies offers investors one of the most intriguing options in the cannabis landscape. The company holds an online platform called NamasteMD, where users will be able to buy products from Canadian licensed producers (LPs) directly.
CEO Sean Dollinger told INN the company has signed a service agreement with all the top LPs and is almost done with signing every LP.
While the company’s weight is 9.74 percent on the CSE25, Namaste’s time on this index may be cut short since Dollinger said the company is looking to switch exchanges into the TSXV.
Thanks to its LP subsidiary Solace Health, TerrAscend offers medical cannabis products to licensed patients in Canada.
As part of its adult-use efforts, the company holds two cannabis brands: Knüba Naturals and Flaura. Both of these brands have a focus on the wellness aspect associated with specific cannabis products.
After Solace Health obtained a sales license for dried cannabis in Canada, TerrAscend announced it plans to launch an online platform for the sale of “multiple brands, cannabis products and strains with varying cannabinoid profiles.”
The company currently has an 8.09 percent weight on the index.
Isodiol International (CSE:ISOL)
Isodiol International is a company focused on the development of cannabidiol (CBD) consumer products and comes in third with a 6.16-percent weight on the CSE25.
Most recently, the company announced the acquisition of a 19.9-percent stake in Compass Cannabis Clinic, a cannabis retailer in BC.
“Under the terms of this acquisition, Isodiol will have exclusive CBD distribution rights for its family of brands through the Compass distribution network,” the company said.
MPX Bioceutical (CSE:MPX)
With a 6.09-percent weight on the index, MPX Bioceutical is a cannabis company with a direct focus on the US market in the states the drug is legal. Through its acquisitions, the company continues to see its footprint grow across the country.
This year MPX has made other efforts into Arizona, having announced the acquisition of a network of assets in the state. As a result, the company was able to earn C$5.2 million in revenues for Arizona alone.
According to Beth Stavola, COO, and president of MPX’s US operations, the Arizona market is well regulated and offers the company a continued growth in the number of patients.
“[T]he supply and cost of flower and trim for re-sale and concentrate production is excellent and, while the Phoenix area market is increasingly competitive, retail prices and margins remain attractive,” she said.
Liberty Health Sciences (CSE:LHS)
Liberty Health is another cannabis operator of businesses and assets in the US, and has a 6-percent weight on the CSE25. The company went through a significant change after Aphria (TSX:APH) announced it would drop its interests in the American space, including its stake in Liberty Health.
Aphria sold its holdings in Copperstate Farms, a company subsidiary in Arizona, to Liberty Health and announced it would also sell all of its interest in Liberty Health itself.
“Liberty remains very well positioned to capitalize on opportunities in the U.S. medical cannabis industry,” Aphria CEO Vic Neufeld said. He remains chair of Liberty Health’s board of directors.
So far this year, Liberty Health has continued its expansion in the US thanks to further acquisitions in Florida and new ones in Massachusetts.
Don’t forget to follow us @INN_Cannabis for real-time news updates!
Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Isodiol International is a client of the Investing News Network. This article is not paid-for content.