- Baked In
- Posts
- 💸 Let's Hit The Trifecta 💸
💸 Let's Hit The Trifecta 💸
Anthony Varrell
June 24, 2024
GM Everyone,
As of this week, we have the first leg of the trifecta down: Ohio. Provisional licenses are being granted, and from what I have heard from my sources, sales are imminent. Now we have two of the more fickle legs to go: Pennsylvania and Florida. If we complete the trifecta this year, we will actually get all of the major catalysts we have been talking about for some time now, and the growth narrative will be back like a sweet breeze in our sails.
Lets have a great week.
Today’s letter can be read in 8 minutes and 16 seconds.
What's Driving the Market Today?
Stock futures are flat across the board, here is what traders are focused on today:
Nvidia's has a 10% drop from record highs after profit-taking, options expiry.
Weak yen nears 34-year low; Japan warns of potential intervention.
EU business activity slows sharply, contrasting U.S. growth acceleration.
Apple faces fine from EU over App Store rule violations.
💸 High Impact
Ohio Issues Provisional Licenses
The What - The Ohio Department of Commerce has issued provisional marijuana licenses to dozens of businesses, marking a significant step toward the imminent launch of adult-use sales. These licenses represent a critical phase for Ohio’s cannabis industry as businesses work to meet regulatory requirements.
The issuance of provisional marijuana licenses by Ohio regulators signals a proactive approach to managing the state’s expanding cannabis market. This development aims to streamline the transition from medical to adult-use sales, providing a clear pathway for existing medical marijuana operators to apply for dual-use licenses.
According to a Department of Commerce spokesperson as reported by Marijuana Moment, “It’s important to keep in mind that a dual-use provisional license does not permit the holder to sell non-medical cannabis; it is issued as a placeholder while the provisional licensee works to meet the necessary requirements to obtain a Certificate of Operation and the Division processes all required documents. Following successful completion of that process, Certificates of Operation will be issued based on roughly the order in which completed applications were received.”
The Why? - The strategy of issuing provisional licenses to medical marijuana operators is designed to expedite the launch of adult-use sales. These dual-use licenses enable businesses to cater to both medical and recreational consumers, provided they meet all necessary requirements. This approach ensures that the infrastructure already established by medical marijuana operators can be leveraged to support the expanded market.
Ohio’s regulatory framework aims to balance the needs of consumers and businesses while maintaining stringent oversight. This dual-use licensing system is expected to reduce delays and enhance the efficiency of market entry for eligible operators. By prioritizing medical marijuana operators for dual-use licenses, Ohio regulators are capitalizing on the experience and compliance history of these businesses.
Ohio regulators’ issuance of provisional marijuana licenses represents an important moment for the state’s cannabis industry. By facilitating the transition from medical to adult-use sales, Ohio is poised to become a significant player in the national cannabis market. The proactive steps taken by Ohio regulators, coupled with the established infrastructure of medical marijuana operators, set the stage for an efficient release of adult-use cannabis sales in the state.
My .02 - We are officially out of the starting block as it relates to the Ohio market coming online for adult use cannabis. With these provisional licenses issued, the first step in the process for adult use conversion is complete for some and pending for others. We now expect sales to kick off in the next few weeks as the formal process progresses.
The sooner they kick off, the better, as we will be able to see the numbers filter into the earnings reports that are to come, much like we saw Maryland do in Q3 and Q4 of 2023. Verano will be the easiest company to see how things are progressing in Ohio due to them actually breaking out their earnings state by state and bifurcating retail vs. wholesale. Thank you, gents.
📈 Dog Walkers
The Netherlands Is On Its Way
For decades, people have had the preconceived notion that cannabis is fully legal in the Netherlands. It’s not. Plain and simple. Up until last week, cannabis was able to be sold in only 2 municipalities within the country. As of last Thursday, the Netherlands has completed the “start-up phase” of expanding legalization and has expanded sales to 10 municipalities.
Canada Sales Are Up
April was another solid month for Canadian cannabis sales, with levels growing 5.3% month over month to C$428.6 million. The Canadian market has been on the uptrend for some time now, which is a great sign to see. However, keep in mind that when converted to USD, the total sales for the country are not that much higher than the monthly sales in Michigan.
🔢 Number O.T.D.
235
That is the number of applications that have been received by the Ohio Division of Cannabis Control requesting authoriztion for adult use sales.
🗞️ The News
📭 Research
Initiating Coverage: Green Thumb Industries - Download Here
Reconfirming Buy Rating: MariMed - Download Here
Initiating Coverage Of Verano Holdings Corp. - Download Here
Initiating Coverage: Trulieve Cannabis - Download Here
📺 YouTube
Would We Buy These Five Small Cap Stocks?
What we covered:
✅ Decisive Dividend Corp (TSXV: DE) a company the acquires manufacturing companies too hold onto for the long run.
✅ Alto Ingredients (NASDAQ:ALTO) is involved in converting corn to higher value products and is adding a carbon capture business unit.
✅ Allbirds (NASDAQ:BIRD) the famous Shoe Company that started in New Zealand.
✅ Alico (NASDAQ:ALCO) a orange grower with huge amount of lands.
✅ Verano Holdings (CBOE CA: VRNO, OTC: VRNOF) a Cannabis Multi State Operator.