Cannabis stocks fell Wednesday, weighed down by weakness in the broader markets and disappointment about some of the latest earnings from the sector.
The major indexes were lower as concerns about the global economy and fears of a protracted trade war weighed on sentiment. A disappointing jobs report from Germany and China’s threat on rare earth minerals — needed for all the gadgets of modern life — added to the downdraft.
Acreage Holdings Inc. shares ACRGF, -4.22% slid 2.6%, after the company’s first-quarter losses widened significantly to $31.2 million, or 39 cents a share, from a loss of $4.2 million, or 8 cents a share, in the year-earlier period. Revenue rose to $12.9 million from $2.2 million. There are no reliable consensus estimates for the company on FactSet, although some were expecting revenue of more than $20 million. Shareholders will have the chance to vote on Canopy Growth Corp.’s CGC, -5.49% WEED, -5.03% proposal to acquire Acreage once cannabis is legal in the U.S., at a June 19 meeting. Canopy shares were down 3.8%.
Charlotte’s Web Holdings Inc. shares CWBHF, -4.18% slid 2.6%, after the company reported a smaller profit for the first quarter than a year ago. The company said it had net income of $2.3 million, or 2 cents a share, in the period, compared with $3.1 million, or 4 cents a share, in the year-ago period.
Revenue rose to $21.7 million from $13.1 million in the year-ago period. FactSet does not report enough earnings and revenue estimates from analysts to form a reliable consensus figure. Charlotte’s Web reiterated its full-year revenue guidance of $120 million to $170 million.
See now: Cannabis stocks mostly higher as sector braces for FDA hearing on rules for CBD
The stock will start trading on the Toronto Stock Exchange after delisting from the smaller Canadian Securities Exchange on May 30. The hemp company is allowed to trade on the TSX after hemp was made federally legal in the U.S. in last December’s 2018 Farm Bill.
See also: This company wants to be the Bacardi of cannabis — and it has plans for an IPO
From advocacy site Marijuana Moment comes the news that the Secure And Fair Enforcement (SAFE) Banking Act will get a hearing from the Senate Banking Committee if it passes the House of Representatives. Two senators, Kevin Cramer, a Republican from North Dakota, and Rand Paul, Republican from Kentucky, told the site that there’s a chance the bill will brought by Sen. Mike Crapo, a Republican from Indiana who chairs the committee.
The act would be the first piece of standalone cannabis legislation to pass Congress and would provide protection for banks that want to serve the cannabis sector in states that have legalized. The House version of the bill was approved by the Financial Services Committee in March and is expected to be approved when brought to a floor vote, which advocates are expecting to happen over the summer.
Separately, lawmakers are promoting the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act, which would give each state the right to determine its own approach to cannabis legislation. That bill is backed by Elizabeth Warren and Cory Gardner, both Senate Democrats and presidential hopefuls, and Attorney General William Barr has said it is his preferred solution.
For more, see: Push for legislation allowing banks to serve the cannabis business is gaining momentum
Medical cannabis sales in Arkansas had a strong showing in their first week, according to Marijuana Business Daily. The state chalked up sales of more than 50 pounds of cannabis in nearly 5,000 transactions, exceeding those in Ohio, which has almost four times the population. Arkansas is expected to generate up to $20 million of sales in 2019, according to the 2019 Marijuana Business Factbook.
MedMen Enterprises Inc. shares MMNFF, -1.27% fell 0.1%, ahead of the release of quarterly earnings on Wednesday. Curaleaf Holdings Inc. CURLF, -3.60% was up 1.5%.
For more, see: Uber to make its earnings debut, joining a passel of pot companies and retailers reporting quarterly results
Tilray Inc. shares TLRY, -5.90% fell 3.4%, Aurora Cannabis Inc. ACB, -2.74% ACB, -2.74% was down 2.4% and Cronos Group Inc. CRON, -2.73% CRON, -4.42% was down 3.9%.
Valens GroWorks Corp. VGWCF, -4.75% was up 4.9%, Organigram Holdings Inc. US:OGRMF was down 3.3% and Aleafia Health Inc. ALEF, -1.30% ALEF, -1.30% was down 1.7%.
GW Pharma PLC GWPH, -1.05% was down 0.6% and Green Growth Brands Inc. GGBXF, +0.02% was down 3.8%. Aphria Inc. APHA, -3.73% APHA, -3.87% was flat.
Read: How living near a marijuana dispensary affects your home’s price
The Horizons Marijuana Life Sciences ETF HMMJ, -2.79% was down 1.8%, and the ETFMG Alternative Harvest ETF MJ, -2.50% was down 1.6%.
The Dow Jones Industrial Average DJIA, -1.35% was down 0.8% and the S&P 500 SPX, -1.09% was down 0.6%.
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Cannabis Watch: See more of MarketWatch’s coverage of cannabis companies
Additional reporting by Max A. Cherney
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