Cannabis stock report: Pot stocks rebound as weed workers strike in Newfoundland and Labrador
The up and down cannabis stock market bounced back up on Thursday as The North American Marijuana Index went back in black for the first time in a few days, gaining 0.49 points up to 108.12. US cannabis stocks carried the day as American companies gained 0.62 points to hit 50.90 at the closing bell, while their Canadian counterparts continued to falter, falling 2.99 points down to 195.75.
It was a bad day all around for Canadian cannabis investors, highlighted by a massive labor strike within Newfoundland and Labrador’s licensed cannabis retailers. According to Marijuana Business Daily, about 40 percent of retailers shut down due to what is believed to be the first-ever labor strike in the cannabis sector. In real numbers, it’s the equivalent of 10 shops.
The 10 stores are located within the Dominion grocery stores, which, combined, make it the single biggest operator of recreational cannabis, according to MJBizDaily. Newfoundland has 26 brick and mortar cannabis stores which serve about 500,000 consumers.
On a high note, it is believed that the store closures are boosting online sales, according to MJBizDaily.
“While it is too early to know what the impact will be on online sales, early indications point to an increase in transactions,” an NLC spokesman told MJBizDaily. “Online transactions were up by 58% when comparing the days during the strike (August 23 to 26) vs. (the) same days the week prior.”
Reports say that about five staffers at each store have gone on strike and that the labor action affects liquor stores in the area as well. In total, over 1400 union workers are on strike Unifor Local 597 president Carolyn Wrice said, according to MJBizDaily.
"Our Dominion members do not take this decision lightly. They would much rather be serving their communities but as frontline workers they felt they could not accept the contract put forth by the company," said Unifor National President Jerry Dias in a statement.
The workers have been without a contract since October 2019. They recently rejected a contract offer from parent company Loblaw Companies Limited.
"There were gains in some areas but in the end the monetary offer fell short, last month Dominion clawed back two dollars an hour pandemic pay from their workers then offered just half of that back over the entire life of the three-year contract," said Dias in a statement.
Cannabis stock winners and losers
MedMen Enterprises Inc. (MMNFF) gained $0.0187 per share up to $0.175, an increase of 11.96 percent. AYR Strategies Inc. (AYRSF) gained $1.2115 per share up to $12.21 for an increase of 11.02 percent. GrowGeneration Corp. (GRWG) increased $1.01 per share up to $15.06, a gain of 7.19 percent.
CannTrust Holdings Inc. (CNTTQ) fell $0.04 per share down to $0.31 for a decrease of 11.43 percent. Indus Holdings Inc. (INDXF) fell $0.1245 per share down to $1.11 for a loss of 10.09 percent. Meta Growth Corp. (META:CA) lost $0.01 per share down to $0.125, a decrease of 7.41 percent.
Fire and Flower moves downtown
Fire & Flower Holdings Corp. (TSX: FAF) (OTCQX: FFLWF) announced that it acquired all of the issued and outstanding shares of 11522302 Canada Inc. That company owns and operates a licensed cannabis retail store in downtown Toronto.
"As we begin to execute on our Ontario expansion strategy, Fire & Flower is thrilled to be acquiring this flagship location on Toronto's high traffic Yonge Street," said Trevor Fencott, Chief Executive Officer of Fire & Flower in a statement. "This location demonstrates our strategy of focusing on retail locations in the province of Ontario that will maximize revenue and margin opportunities for our business."
In other cannabis news…
Israeli Health Minister Yuli Edelstein issued new regulations on Wednesday that lowered the price of medical cannabis and made it easier for people to obtain CBD. “Today we are lifting the stifling constraints that surround the use of medical cannabis,” Edelstein said in a statement.
“When my late wife, Tanya, was in her final months and the pain was unbearable, the doctor suggested she use cannabis. I witnessed how it helped her. I don't know if it had harmful effects on her body, but concerning the pain, it definitely helped her."
A new study shows that states with legal cannabis had much lower rates of vaping lung issues last year.
Will Trulieve dominate cannabis in the south?