SMITH FALLS, Ontario – Another milestone for the cannabis industry was reached today…
Canopy Growth [TSX:WEED], Canada’s largest and arguably most successful marijuana company – has been added to the S&P/TSX Composite Index. The index represents nearly 70% of the total market capitalization on the Toronto Stock Exchange and is considered a key benchmark for the Canadian equity market.
With the addition of Canopy Growth to the index, more and more investors will now be ‘buying and holding‘ weed.
Canopy Growth has a market capitalization of $780.6 million and a year-to-date stock price change of +192%. Canopy Growth is definitely a cannabis company to watch in 2017.
“Being added to the index is an important accomplishment and a reflection of the work we’ve done to put Canopy Growth top of mind in the investment community,”
“With international operations, high profile partnerships, and expansion plans all developing rapidly, being included in the index acts as another layer of credibility investors can point to.”
– said Bruce Linton, Chairman & CEO
The decision to add the company followed a quarterly review by S&P Dow Jones Indices and will take effect after close of trading on March 17, 2017.
What about the Mettrum recall?
Canopy Growth acquired Mettrum Health Corp on January 31st, 2017. Mettrum is a Canadian marijuana company taking some heat lately due to the discovery its marijuana products may have been tainted with potentially dangerous pesticides.
A random screening by Health Canada initially discovered the unauthorized use of pyrethrin – a pesticide not approved for medical cannabis. Apparently, this was not the only banned pesticide present in Mettrum’s marijuana.
The Globe & Mail reported that myclobutanil, a dangerous pesticide that converts to cyanide upon combustion, may be the cause of the company’s expanded (yet still voluntary) product recall.
I don’t believe this is a long-term problem for Canopy Growth…
For starters, Mettrum’s indiscretions occurred before Canopy Growth came into the picture. As soon as Canopy Growth became aware of the problem, the company immediately instituted a massive voluntary product recall. In addition, Mettrum’s products are now rigorously tested above and beyond the requirements of Health Canada.
Tweed and Tweed Farms, Canopy Growth’s signature marijuana brands, have well established quality assurance processes in place. It’s likely that Mettrum will benefit from this experience as it revamps its production processes to ensure this doesn’t happen again.
Inside America’s Billion-Dollar Weed Business