THE CONSUMABLES SHOW
We are hosting our weekly Consumables Show today, September 18th @ 12 PM ET.
EVENT DETAILS:
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Every Monday at 12 PM ET our Consumables Team will be hosting a live event where we will go through Timely and Topical events/data that have occurred in our respective industries, as well as preview the week to come. We hope that you can grab your lunch and join us as we break down the Restaurant, Consumer Staples, and Cannabis space.
We will explore a number of topics including recent position monitor changes, top questions from client meetings, most frequent inbounds, pushback on our most recent calls, and updates on some of our best ideas.
CRON enters Europe
Cronos Group (CRON) is a Hedgeye Cannabis Best Idea Long.
This move by Cronos (CRON) is a strategic step towards expanding its global presence and tapping into one of Europe's most significant markets. The partnership with Cansativa and the evolving regulatory landscape in Germany make this a timely and potentially lucrative step for the company. The announcement from Cronos about their shipment of bulk cannabis to Germany under the PEACE NATURALS brand is significant for several reasons:
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Strategic Partnership: The collaboration with Cansativa Group, a leading distributor in Germany's medical cannabis market, gives Cronos a strong foothold in the German market. With Cansativa's extensive network of approximately 2,000 pharmacies, Cronos can effectively distribute its products to a vast number of patients.
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Market Potential: Germany, with a population of around 83 million, offers a substantial market for Cronos. The statement from Mike Gorenstein, the Chairman, President, and CEO of Cronos, emphasizes the company's ambition to establish PEACE NATURALS® as a leading medical brand in Germany, mirroring its reputation in Israel.
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Regulatory Changes: The recent decision by Germany to reschedule cannabis and not categorize it as a narcotic is a game-changer. This move is expected to spur significant growth in the cannabis market, making it an opportune time for Cronos to re-enter.
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Insurance Coverage: One of the advantages of partnering with Cansativa is the access to patients who have insurance coverage for medical cannabis. This can potentially lead to higher sales and a broader customer base for Cronos.
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Anticipation of Legalization: The introduction of a bill in the German parliament in August 2023 to legalize adult-use cannabis indicates a shift in the country's stance towards cannabis. If passed, this legislation can open up an even larger market for Cronos and its PEACE NATURALS® brand.
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Positioning for Future Growth: By re-establishing its brand in Germany now, Cronos is strategically positioning itself to capitalize on potential future legislative changes and the anticipated growth in the cannabis market.
Canopy Finds Some Money
CGC is up 192% in a month and now selling equity LOL
Canopy Growth (CGC) announced today that it has entered into subscription agreements with certain institutional investors in a private placement offering of ~23M shares at a price per share of $1.09 for aggregate gross proceeds of approximately ~$25M. The Investors also hold an over-allotment option to acquire up to an additional ~23M shared at the same price any time on or before November 2, 2023. Canopy's stock is up 194% in the past month due to news of the possibility of cannabis being rescheduled in the United States. This management team saw an opportunity to sell shares that were inflated due to headline news to sure up their balance sheet.
Lets not get carried away
What will Mitch do? Senator McConnell health problems are s big problem for the passage of SAFE in the senate.
The Senate Banking Committee will mark up the SAFE Banking Act on Wednesday, Sept. 27. The bill still needs to pass the procedural threshold and receive majority support on the Senate floor. If it passes the Senate, it will need to go through the entire process again in the House. House Speaker Kevin McCarthy has voted in favor of the bill in the past, but House Financial Services Chair Patrick McHenry has voted against it. The chances of it getting past the senate are less than 10%!
