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Cannabis Summary for April 23, 2020

2020-04-23 19:38 ET - Market Summary

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by Stockwatch Business Reporter

The S&P/TSX Cannabis Index gained 1.36 points to 128.28 Thursday, while the Canadian Securities Exchange Composite Index gained 4.77 points to 298.98. Indiva Ltd. (NDVA) gained 5.5 cents to 34 cents on 808,300 shares after releasing preliminary results for the first quarter of 2020. The company's sales increased dramatically (hence the preliminary report -- mediocre results can always wait for the official version), mostly the result of its Bhang chocolate edibles becoming available for sale. Indiva expects to have between $2-million and $2.2-million of sales in Q1, up from $300,000 in Q4 2019. The robust growth was most pronounced in March, in which Indiva had sales of about $1.4-million.

There has been speculation about how much edibles and other cannabis 2.0 products (such as vapes and beverages) will move the needle for cannabis companies in Canada. It is likely that, with an increase in sales of cannabis 2.0 products, there will be a decrease in sales of marijuana flower (typical marijuana that you smoke in a joint). Many of the buyers of cannabis 2.0 products will just be buying edibles and beverages as an occasional substitute to flower. Still, Indiva's results give investors something to cheer about. Whether that speaks to the specific popularity of Indiva's edibles or the broader success of the cannabis 2.0 market is unclear.

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