In the Canadian cannabis space, investors have certainly experienced a world of pain over the past twelve months. Most marijuana producers are now trading at or near 52-week lows, with the bottom continuing to drop out for most of these companies.
Companies like Organigram Holdings Inc. (TSX:OGI) are a great example – trading as high as $11.30 this past year, shares of Organigram can now be scooped up for $2.60 at the time of writing, a cool 77% discount off of the 2019 high.
Let’s take a look at where shares of Organigram may be heading.
The company has recently been undertaking a media blitz to inform investors of the impending growth which is expected to come from edibles, various vaping products, and beverages – growth segments the company’s management team doesn’t believe are being fairly or accurately priced into the company’s current stock price.
At this point in time, it’s hard to say when such products will be made available (it will no doubt take time for governments to regulate these products), so what we have right now is an interesting stalemate of companies who have exhibited revenue growth rates that have underwhelmed, along with profit margins that have imploded, and future prospects which remain unclear.
It is for this reason I’d suggest to investors that perhaps waiting for the industry to stabilize may be the best course of action, considering just how unpredictable the future remains, in particular with respect to a cannabis industry which is in its infancy.
Invest wisely, my friends.