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Cannabis Stocks Show Impressive First Quarter Gains  

By Investing.com (Brenda O'Farrell/Investing.com)Stock MarketsApr 06, 2021 06:28AM ET
www.investing.com/analysis/cannabis-stocks-show-impressive-first-quarter-gains-200571456
Cannabis Stocks Show Impressive First Quarter Gains  
By Investing.com (Brenda O'Farrell/Investing.com)   |  Apr 06, 2021 06:28AM ET
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Canadian cannabis stocks are being given some of the credit for propelling the Toronto Stock Exchange, the country’s main stock index, to posting an impressive gain in the first quarter of 2021.

The TSX reported a 7.37% uptick in the first quarter of the year, propelling it to rank 34th among the 92 global market indexes. This gain is due, in large part, to the performance of the exchange’s health care subsector, which saw an almost 40% surge in the first quarter. This drive upward was fuelled largely by cannabis stocks that benefited from increasingly positive signs of the growing list of US markets moving to legalize the weed.

The two top performing stocks on the TSX in the first quarter were cannabis companies Aphria (TSX:APHA) (NASDAQ:APHA) and OrganiGram (TSX:OGI) (NASDAQ:OGI).

APHA Daily
APHA Daily

Aphria, which closed up slightly on Monday at $22.79 on the TSX and posted a less-than-half-percent increase for the day on the NASDAQ in New York, has gained more than 160% in the first quarter of 2021. In the last year, the marijuana grower has seen its increase by 542% on the New York exchange. It had a slightly less spectacular showing in Canada, where its shares on the TSX in the last year gained 474%

Part of the reason Aphria shares have done so well has been its execution on its plans to expand, striking a deal to acquire another Canadian-based cannabis company, Tilray (NASDAQ:TLRY). The deal, which was announced towards the end of 2020, is on track to be completed later this month. The new combined company will operate under the Tilray name. It is estimated that it will control roughly a fifth of the cannabis market in Canada. 

And with plans to expand in the US, where legalization continues to march forward, the stock appears poised to continue its upward trajectory. According to Toronto's Globe and Mail, nine out of 15 analysts peg it as a strong or moderate buy.

As for Organigram, its shares gained almost a full percentage point yesterday on the TSX to close at C$4.36 and 1.45% to end the day Monday at US$3.49 on the NASDAQ. The Canadian-traded shares gained almost 157% in the first quarter. In the last year, they have added just over 91% on the TSX, while US-traded shares have surged just over 115% in the last 12 months.

OGI Daily
OGI Daily

Like Aphria, Organigram is poised to be a player in the growing US market, with British American Tobacco (NYSE:BTI) scooping up an almost 20% stake in the company last month.

Together, Organigram and BAT plan to build a research facility to develop what they are calling “next-generation cannabis products.”

Cannabis Stocks Show Impressive First Quarter Gains  
 

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Cannabis Stocks Show Impressive First Quarter Gains  

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Comments (10)
Mufite Khan
Mufite Khan Apr 06, 2021 3:06PM ET
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help
Sr Ma
Sr Ma Apr 06, 2021 3:06PM ET
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Ask Allah
Celian Mathis
Celian Mathis Apr 06, 2021 12:58PM ET
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The US is on the way to become the country with the highest rate of schizophrenia per 100,000 inhabitants...
Edward Shahrokh
Edward Shahrokh Apr 06, 2021 12:58PM ET
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Say more...
Chandu Vaspari
Chandu Vaspari Apr 06, 2021 12:31PM ET
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I poor because I want money
Andy Dominic
Andy Dominic Apr 06, 2021 11:34AM ET
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VP said, we will decriminalized marijuana..."probably Be, but you never know
Vivian Yeung
Vivian Yeung Apr 06, 2021 11:28AM ET
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Then why is Tilray dropping?
Murugan Nta
Murugan Nta Apr 06, 2021 11:18AM ET
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hi Medan you native country
Iris Capua
Iris Capua Apr 06, 2021 11:05AM ET
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This so great
Jose Barreto
Jose Barreto Apr 06, 2021 10:49AM ET
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Amazing turn around. Legal Pot Sector will be huge. Medical Pot is a healthy market place. Revenue growth across both is really impressive.
Julio Garcia
Julio Garcia Apr 06, 2021 10:49AM ET
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Is thos hiaeah barreto
Michael Reif
Michael Reif Apr 06, 2021 9:16AM ET
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Canadian companies are significently smaller than the multi-state, U.S. marijuana companies. Furthermore they have no access to the huge U.S. market without federal legalization, which is unlikely in the near and medium term.
Rabindra Thapa
Rabindra Thapa Apr 06, 2021 8:24AM ET
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How abt sndl
 
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