Since the beginning of 2017, most cannabis stocks have been on a downward trend as a result of the mixed signals that the Trump administration has been putting out regarding the enforcement of federal marijuana laws. Most recently, on Friday May 5, 2017, President Donald Trump signed the Consolidated Appropriations Act of 2017, otherwise known as the continuing resolution appropriations bill to temporarily fund the U.S. Government. The bill includes a provision intended to prevent the Justice Department, including the Drug Enforcement Administration, from utilizing funds to arrest or prosecute patients, caregivers, and businesses that are acting in compliance with state medical marijuana laws. Section 537 of the Consolidated Appropriations Act, 2017 states that:
“None of the funds made available in this Act to the Department of Justice may be used, with respect to any of the (regulated) States…to prevent any of them from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana.”
AmeriCann Inc (OTCMKTS:ACAN) CEO Tim Keogh commented on the legislation as follows:
“It is significant that the very first piece of major legislation signed into law by the new administration protects medical marijuana patients and the states that have approved medical cannabis. The continuation of bipartisan policies that preserve patient access to cannabis is very positive.”
For those that are not acquainted with AmeriCann, Inc., it’s a publicly traded company that plans to develop and lease sustainable, state-of-the-art medical cannabis cultivation properties. The Company has over 1,000,000 square feet of facilities in the planning and design stages of development. The Company has also designed a proprietary line of cannabis infused products which will be branded and licensed to companies in regulated markets.AmeriCann, Inc. has developed and owns Solanna, a new comprehensive line of nutraceutical-grade cannabis infused products. The company has created the brand, packaging concepts and invested significantly in Standard Operating Procedures and Good Manufacturing Practices to ensure safety, consistency and efficacy across the product offering. The Solanna line of products will be offered exclusively through AmeriCann's Preferred Partners.In our last review of AmeriCann, we reported on the aggressive media campaign that the Company has been engaged in. AmeriCann continued the campaign at the Pioneers 2017 Conference in New York City on May 2, 2017. The Pioneers 2017 Conference, presented by Joseph Gunnar, is an exclusive event for institutional and accredited investors who specialize in microcap companies and emerging growth industries to conduct one-on-one meetings with AmeriCann and other participating companies, as well as view formal presentations.On May 4, 2017 at the New York Real Estate Journals first cannabis-focused summit, AmeriCann President and CEO, Tim Keogh, served as Title Presenter, and a panelist. The New York Real Estate Journal (NYREJ) is a sister-company of the New England Real Estate Journal. The NEREJ is the largest commercial real estate media company in the world that covers all six New England states and has been in business since 1963.Some very interesting facts were discussed during the summit. As the Cannabis industry continues to develop in the United States, the Commercial Real Estate market in the Northeast is expected to undergo significant expansion and revitalization. According to a September 2015 Market Report conducted by CBRE, a reputable Real Estate Services Firm, during the current business cycle, the marijuana industry was a key factor in the industrial sectors recovery. In Denver, 35.8% of total net absorption in industrial space between 2009 and 2014 can be attributed to the growth in the marijuana industry. Cultivation accounted for at least 3.7 million sq.ft. of occupied industrial space. The Marijuana Business Daily Factbook 2016 reports that cannabis storefronts average $974 in revenue annually per square foot of space. Based on this key financial metric, this volume of sales puts Cannabis storefronts in the same range as Whole Foods stores and Costco Wholesale stores.AmeriCann’s efforts to gain exposure are not going unnoticed. The Company is beginning to garner interest from an increasing number of national financial publications. The expanded media coverage includes recent mentions in Forbes, Barrons, CNN Money, MarketWatch, The Wall Street Journal and others. Additionally, Morningstar Research issued a report on May 4 rating ACAN as Undervalued with a Fair Value of $6.27 per share.On the same day, May 4, 2017, AmeriCann announced the hiring of Dr. Brian Corr as Director of Horticultural Science and Operations. Dr. Brian A. Corr, is a noted expert with 40 years of experience in controlled-environment horticulture with companies such as Ball Horticulture and Syngenta (NYSE:SYT). Dr. Corr will be Vice President of Operations for AmeriCann, responsible for facility design, operations, and product development.
Like most stock in the cannabis sector, ACAN stock has been on a downward trend since early 2017. It made a strong upward spike on February 22, 2017 and has been trading down since. It is currently trading at $2.18. Current market capitalization stands at $50.82 million, on 18.08 million shares outstanding as of June 2, 2017Cowen & Co. a well-respected Wall Street firm, recently released a research report projecting dramatic growth for the industry from the current $7 billion nationally to over $50 billion in ten years. Although the market is currently reacting to short-term setbacks in the sector, the regulated cannabis industry remains one of the fastest growing industries in the country. The savvy investor may be apt to regard the sector-wide dip in stock prices as a discounted opportunity to enter the cannabis market. We will be updating our subscribers as soon as we know more. For the latest updates on ACAN, sign up below!Disclosure: We have no position in any of the securities mentioned and have not been compensated for this article.
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