Weed stocks getting high with 1000% gains

Danny Deadlock Danny Deadlock, TickerTrax
19 Comments| March 21, 2014

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MEDICAL MARIJUANA - LITERALLY ON FIRE
 
Once you see the charts below you may agree that these are bordering on the ridiculous (irrational).
 
At this stage (because we will no doubt see more going from metals exploration to selling marijuana), a handful of companies are planning to enter the medical marijuana business and almost doubling on the "notion". The majority are up hundreds of percentage points in the first month and gains in excess of 1000% have not been uncommon.
 
The companies can state that nothing has been “secured” but traders simply don't care. On the CNSX they can get away with a simple “change of business” (COB) but on the TSX or TSX Venture a COB can result in a trading halt that lasts months.
 
The CNSX (www.cnsx.ca) is becoming the "go-to" exchange for pot stocks but be cautious on the TSX.V where the guidelines are very strict.
 
Tweed is doing a reverse takeover (RTO) through LW Capital Pool Inc. (TSX: V.LWI.H, Stock Forum) (halted) so this will be the first high profile Venture Exchange listing and will be watched closely.
 
http://www.thestar.com/business/2014/03/13/financing_abounds_for_medical_marijuana_startups.html
 
Friday morning a very small company called Supreme Pharmaceuticals Inc. (TSX: V.SL, Stock Forum) (4 cents) announced they "may" be getting into the medical marijuana business. Because they are not a mining related company but life sciences, this may serve as a TSX Venture vehicle that works better for this type of industry - I really don't know - but it may be one to watch.
 
I don't cover alcohol, tobacco, or ... marijuana.  As a microcap equity analyst and writer of an investment letter I try to avoid politics, religion and certain industries. There is no doubt money can be made (and already has been made), but a LOT of money will also be lost.
 
Speculators will get drawn into the hype and in typical Canadian penny stock fashion many companies will end up nothing more than aggressive stock promotions reminiscent of mining companies. Typically those early to the table will make a small fortune (along with professional traders along the way) and the typical retail investor will be left holding the proverbial bag - in this case maybe a bag of weed! 
 
No doubt some companies will do very well and the cream will eventually rise to the top. But it is inevitable that widows and orphans will be left standing by the road wondering what just happened.
 
This entire industry is new so trying to value these companies will be extremely difficult. Plus brokers and analysts will have to struggle with the ethical questions associated with the industry. They will need to balance the money they can make from investment banking relationships vs. the damage it may do to their credibility or the clients they may offend by issuing positive research reports on drug usage.
 
Regardless of the outcome it will be interesting to see how this industry evolves from a public company perspective.
 
Many Americans already view us as a bunch of pot smoking hippies - so we may as well be the leaders in using public companies to raise funds designed to fuel a generation of younger pot smoking hippies!  Realizing of course I say that with a strong hint of sarcasm.
 
 
MARIJUANA STOCKS ON THE CNSX:
 
Next Gen Metals (CSX: C.N, Stock Forum) ($0.60) - nextgenmetalsinc.com
 

 
Enertopia Corp. (CNX: C.TOP, Stock Forum) (93 cents) - enertopia.com
 
I was going to trade TOP back in January at 18 cents but avoided it because it was tough to buy on the CNSX and I was unsure how these would perform in Canada. Not one of my more brilliant decisions!
 

 
Lexaria Corp. (CSX: C.LXX, Stock Forum) ($0.74) - lexariaenergy.com
 

 
Abattis Bioceuticals (CSX: C.ATT, Stock Forum) ($2.40) - abattis.com
 

 
AMERICANS STARTED THIS VALUATION INSANITY IN 2013
 
A few of these companies in the United States border on a joke. FITX for example ran from 0.0009 in Sept 2013 to 11 cents by February. How is a public company even allowed to trade that low without being bankrupt?
 
This occurs too frequently on the U.S. Pink Sheets and it's the reason I avoid that market like the plague - it makes the old Vancouver Stock Exchange look like the NYSE.
 
If you are interested in researching this industry further. Here is the list of companies I could find in the United States.
 
FITX $0.09 - cenbiotechinc.com
PHOT $0.65 - growlifeinc.com
ZDPY $15.51 - zonedproperties.com
MNTR $4.65 - mentorcapital.com
EFFI $0.07  - efftec.com
HMTF $2.26  - hometreasurefinders.com
MDCN $3.00 - medicaninc.com
CANV $61.45 - MedicalMarijuanaInc.com
CBIS $0.18 - cannabisscience.com
EDXC $0.29 - endexx.com
FSPM $6.58 - fusionpharminc.com
GRNH $0.58 - greengrotech.com
HEMP $0.12 - hemp.com
MDBX $30.36 - medbox.com
MJNA $0.31 - medicalmarijuanainc.com
MWIP $0.50 - mediswipe.com
TRTC $0.98 - terratechcorp.com
 
 
 
** TWITTER NOTE:  I maintain a twitter page at - twitter.com/tsxalerts  


Tags: INDUSTRIAL METALS & MINERALS OIL & GAS E&P ENERGY BIOTECHNOLOGY

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ShipitIndustries
Yes this is all gonna tank hard next week. Govt shut shut down red days coming
2.5 stars
March 21, 2014
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ABirdsEyeView
4seas your brutal...feds didnt throw all changes out, in fact it all stayed the SAME except that 40k growers can keep growing....for now.
2.5 stars
March 22, 2014
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banjo2
Well it's certainly not "all over" but this should slow things down considerably.
4.5 stars
March 21, 2014
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dreaddogs
Government will be appealing....they know that there is big money....Conservative government are still taking application ffor commercialized pot
4.5 stars
March 21, 2014
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tcalandra
Excellent roundup.
4.5 stars
March 22, 2014
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EOIM
I got into the weed action this morning by buying 100,000 shares of Supreme Pharmaceuticals (SL) at 0.035 cents because the news release seems to indicate the guys might know what they are doing. Already in the money in it. I can see why investors would be very excited in the growth prospects of this market. The timeline to cashflow is rapid unlike the bloody resource sector that is capital intensive and takes decades. Time will tell.
2.5 stars
March 21, 2014
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opsd1
TFR only up 75% on huge volume. Much less risk with this one.
4.5 stars
March 22, 2014
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mewbuddy
ELN.VN has the exactly same management team as N:CSE. Could be announcing taking new business changes any time soon. 30m shares out. 6 cents. N roacket from 3 cents to 70cents!
2.5 stars
March 23, 2014
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keepitrealhomie
One stock that is not on that list is Latenno Food Corp (LATF). They are selling marijuana edibles. Moving home base to Colorado and they have just acquired a grow-op.
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March 23, 2014
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StockGuru2k11
Wow the same old residemt bashers spewing the boards because they missed the boat below and trying to get in cheaper. We know you too well
2.5 stars
March 22, 2014
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