'The valuations are really stupid': Marijuana stocks spike trip circuit breakers, temporarily halted
TORONTO — Volatile share prices of Canada’s publicly traded marijuana companies triggered numerous circuit-breaking halts in trading Wednesday as buzz surrounding the nascent sector pushed valuations to record intraday highs.
Aphria Inc., Mettrum Health Corp., Organigram Holdings Inc., Supreme Pharmaceuticals Inc., Aurora Cannabis Inc. and Canopy Growth Corp. were all halted for five-minute intervals Wednesday—some of them multiple times.
The Investment Industry Regulatory Organization of Canada said the halts were triggered by single stock circuit breakers “due to volatility in the stock prices.” It did not comment further.
Circuit breaks are tripped when a stock climbs or falls at least 10 per cent in a five-minute period, which appears to have been the case with the six marijuana stocks Wednesday.
The halts seem to have put the brakes on for overly enthusiastic investors as five of the six stocks closed lower. Many were halted again after seeing a similar tumble on their way down.
Canopy Growth — Canada’s largest marijuana company — was halted four times, after reaching a valuation of $2 billion, double its worth on Friday when it first reached the $1 billion mark for the first time.
That hefty valuation comes despite the fact the Smiths Falls, Ont.-based company has yet to report a profit and earned $8.5 million in revenue during the most recent quarter. Seen as a bellwether for the sector, the stock turned around to close 15.2 per cent lower at $11.40. It was the most actively traded stock on the TSX Wednesday, with more than 24 million shares changing hands.
Vancouver-based Aurora Cannabis was the first to trigger the circuit breaker after its stock price gained 46 per cent in the half hour after the opening bell. It was the only one to remain in positive territory at the close—up 11.8 per cent to $2.94.
TORONTO — Volatile share prices of Canada’s publicly traded marijuana companies triggered numerous circuit-breaking halts in trading Wednesday as buzz surrounding the nascent sector pushed valuations to record intraday highs.
Aphria Inc., Mettrum Health Corp., Organigram Holdings Inc., Supreme Pharmaceuticals Inc., Aurora Cannabis Inc. and Canopy Growth Corp. were all halted for five-minute intervals Wednesday—some of them multiple times.
The Investment Industry Regulatory Organization of Canada said the halts were triggered by single stock circuit breakers “due to volatility in the stock prices.” It did not comment further.
Circuit breaks are tripped when a stock climbs or falls at least 10 per cent in a five-minute period, which appears to have been the case with the six marijuana stocks Wednesday.
The halts seem to have put the brakes on for overly enthusiastic investors as five of the six stocks closed lower. Many were halted again after seeing a similar tumble on their way down.
Canopy Growth — Canada’s largest marijuana company — was halted four times, after reaching a valuation of $2 billion, double its worth on Friday when it first reached the $1 billion mark for the first time.
That hefty valuation comes despite the fact the Smiths Falls, Ont.-based company has yet to report a profit and earned $8.5 million in revenue during the most recent quarter. Seen as a bellwether for the sector, the stock turned around to close 15.2 per cent lower at $11.40. It was the most actively traded stock on the TSX Wednesday, with more than 24 million shares changing hands.
Vancouver-based Aurora Cannabis was the first to trigger the circuit breaker after its stock price gained 46 per cent in the half hour after the opening bell. It was the only one to remain in positive territory at the close—up 11.8 per cent to $2.94.
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