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Cannabis Stocks Trading Mixed On Contradictory News

Summary

Canadian cannabis stocks are trading mixed this Wednesday in a trend that has persisted since the beginning of the week when CannTrust's share price lost a further 5% following another.

This comes after the Canadian authorities announced that a probe of CannTrust's operations had revealed that the company was cultivating cannabis in unlicensed rooms at its Pelham, Ontario site. In an effort to draw a line under this scandal, the company dismissed two members of its executive management team who, it is alleged, were aware of the violation but failed to take action to halt the unlicensed production activities.Now the company is looking at a variety of potential solutions to the challenges it is facing including selling the business outright. In other news, some cannabis stocks received a boost in the form of reports that US company MedMen has become a major supplier of cannabis to the Californian market, boasting 17 retail locations in the state.Elsewhere, shares in Aurora Cannabis (OTC:ACB) fell after the company announced it had completed its $47.7 million acquisition of Hempco Food and Fibre Inc. Following the deal, Hempco will become part of the Canadian giant's Aurora Hemp arm whose focus will be the production of hemp-derived products.

Our financial scouts believe that, as long as the news atmosphere remains contradictory, the cannabis market will continue to trade mixed. As such, they see shares in Canopy Growth (CG) up to $28.00, with Aurora Cannabis and Aphria (OTC:APHA) also rising to $6.50 and $7.00 respectively. Meanwhile, they predict potential share price drops for Tilray (TLRY) and Cronos (OTC:CRON) to $28.50 and $11.50 respectively.