Tilray

This company leads the ranking of the six largest cannabis companies in the Canadian market. Tilray supplies medical cannabis products to patients, doctors, hospitals, pharmacies, researchers and governments across more than 20 countries and on five continents under various brands. The company recently launched a new platform to help destigmatize the use of medical marijuana in women's healthcare. On April 10, the company announced an acquisition agreement with Canadian competitor HEXO.

Shares are losing value

Shares of NASDAQ-traded Tilray lost more than 40% of its value during the past year. Looking at the chart, we see that over the past 5 years, the stock has dropped from $10 per share to just over $2 per share, what represents a 98 percent decline. The company's stock hit an all-time high in September 2018 and has been on a downward trend since then.

                       Chart: the evolution of the value of Tilray Inc. since its listing in 2018.*

Curaleaf

Curaleaf ranks first among the leading cannabis companies in the US. The company operates in 19 states. In early 2023, the company announced plans to terminate operations in California, Colorado and Oregon in order to reduce costs. The New Jersey factory dismissed 49 employees in July as a result of production cutbacks. Over the past year, the company has dropped in more than 37% of its value. Looking at five-year performance, the stock has written off more than half of its value, at 52%. * Since going public, the stock hit an all-time high in early February 2021. Since then, they have been on a downtrend.

                                 Chart: Curaleaf Holdings value progress since 2018.*

Legality could be an issue

The distribution and overall sales of cannabis are impacted mostly by the conflicting issue of its legality in different countries. Therefore, promotion of these products is limited in many countries. Currently, recreational use of cannabis is allowed in only 21 states in the US and worldwide, 48 countries have allowed it for medicinal purposes. For instance, the Czech Republic has allowed using cannabis for medical purposes, Slovakia has not. For example, the Canadian cannabis industry continues to be threatened by systemic regulatory problems and an illegal marijuana market. Despite various positive predictions for the cannabis market, the stock performance of the best-known companies in the sector has been weak so far. To the above mentioned we can add High Tide, Canopy Growth or Trulieve Cannabis Corp.

Letting cannabis grow is sometimes difficult

Canopy used to be a multi-billion dollar company, yet its assets have been shrinking over past years. The company has already received a notice of non-compliance from the Nasdaq stock exchange, where its shares are listed, stating that it has remained below $1 per share for 30 consecutive business days. In mid-July 2023, the company expressed doubts about its ability to continue its current operations due to debt. The company's total outstanding debt as of March 31, 2023 was C$1.3 billion. The company is attempting to improve its situation by leaving some international markets and closing its stores.

                                     Chart: evolution of Canopy Growth's value since 2014.*

Negative facts

Investors foresee persistence of negative trends in the cannabis industry into mid-2023. In the US, the absence of meaningful policy reform is obvious, and Canadian providers face strong competition and unfulfilled sales expectations. The American FDA has rejected the sale of CBD as a dietary supplement and prohibits its use in food. In addition, the industry is under pressure from unregulated markets that are depriving it of potential customers. In general, companies are not doing well and some are having difficulty going public. The cannabis industry still has a long way to go and many investors are rather sceptical.

The cannabis industry and its progress is still debatable, but if more countries join its legalization, it could have considerable potential due to its high popularity. Moreover, it could reverse the current long-term bearish trend of companies in this segment back to the green numbers it was in back in 2018-2019, when many studies on the positive effects of CBD had huge impact on popularity. [1]

[*]Past performance is no guarantee of future results.

[1] Forward-looking statements are based on assumptions and current expectations, which

may be inaccurate, or based on the current economic environment, which may change. Such

statements are not guarantees of future performance. They involve risks and other

uncertainties that are difficult to predict. Results may differ materially from those expressed

or implied by any forward-looking statements.