Odd Lots - How To Analyze A Marijuana Stock

Episode Date: October 15, 2018

Marijuana stocks have been on a tear recently, as investors bet on the explosion of a brand new, legalizing market. But, how should investors actually go about trying to figure out which companies are well run and in a position to profit from this mark?*Editor's note: Our guest Craig Wiggins misidentified the company "Aurora" as building to scale around 14:54 in the episode. The correct company is Aphria.See omnystudio.com/listener for privacy information.

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Listen on Bloomberg Radio, stream the show live on the Bloomberg business app, or listen to the podcast. That's Bloomberg this weekend. Saturdays and Sundays starting at 7 a.m. Eastern. Make us part of your weekend routine on Bloomberg Television, radio. and wherever you get your podcasts. Welcome to another episode of the Oddlots podcast. I'm Joe Wisenpaw.

And I'm Tracy Alley. Tracy, you want to hear something funny? Always, Joe. So I think in our work chat the other day, I don't think you were online. I think you were off that day. But in our work chat the other day, I was talking to some of our colleagues. And I found out that they have a different description of me and you. They have a different way of thinking about our roles.

Oh, really? Yeah. Okay. Have you heard this? I'm very curious. No. Okay. So you know how like I am always sort of jumping on like whatever the hot market story is?

Last year I was talking about crypto a lot. And this year I wrote an article about cannabis or whatever it is. And you consistently cover the very serious things, right? So you're into like credit markets and market structure. And you basically are. have an understanding of the things that will be enduring through markets for a long time, whereas I'm much more flighty and just sort of jump to whatever is hot. So anyway, apparently they say that I'm the momentum factor and you're the value factor

is sort of how they see our different roles. Sorry. Isn't that perfect? That's great. I guess we need to think about rebranding odd lots as momentum and value. Oh, God, it sounds like a terrible, like, sitcom. But it is a good characterization. Anyway, so, you know, I wrote this story a few weeks ago for Business Week about exactly what I'm talking about, cannabis and crypto and various investing fads and bubbles and psychology and stuff like that.

And in doing the research for that story, I came across what at the time was a group of anonymous experts in marijuana investing called The Cannalists. and they have a podcast and a page on Reddit where they analyze really intensely break down the various businesses of all these marijuana companies that people are investing in. And it's pretty clear that they're very far ahead of the pack. Like a few different guys whose understanding of the granularity of the industry are far above where most of the media and most Wall Street analysts are on this nascent area. Right. So I remember reading a little bit about this in that piece that you did for Business Week. And I thought it was really fascinating because every once in while you see these communities essentially spring up on Reddit. And sometimes these communities going to an insane amount of granular detail about what they're talking about. And the catalyst is definitely one of those. And even though, you know, I started by saying how you and I, we sort of have different complementary approaches. which is one thing that I know both of us are very fond of is any stories of essentially someone on the internet becoming the X in a certain space. So like we both used to read like calculated risk.

Bill McBride, we had him on the podcast. Like we both love these stories of like someone online on their own independent of major institutions becoming the expert, becoming the must read on some new area. Right. Especially when it's new. And that's, I think, the thing that's the most interesting about. cannabis stocks right now because you're talking about an entirely new industry, potentially, with a whole new set of rules and a whole new way of functioning. And a lot of the people, the traditional people, the sell side analysts on Wall Street, haven't really wrapped their heads

around it just yet. Exactly right. So the interesting thing is right after my article came out, the canalists, they de-anonymized themselves. They docks themselves and revealed who they are. and we're very lucky because one of them has agreed to come on today's Oddlot podcast. So I would like to bring in Craig Wiggins. He is one of the three panelists. Craig, thank you very much for joining us. Joe, Tracy. Pleasure to be here.

It's nice to be a guest on a podcast and not have to run the show. I know. I've been, whenever the few times I've been a guest on a podcast, I always appreciate how much easier it is. So I'm glad you're with us. Tell us, why do you just give us the background? Who are you? Who are the canylists? And why do people read your stuff?

Well, with respect to the canalysts, I actually found both Cydachrome, Graham Jones, who's our PhD candidate at Brock University in biotech, and Molly Time, Andrew Udell, on social media forums. And the social media forums, you would think in most cases you go to these forums and somewhat characterize it as a zoo. Very loose dialogue, a lot of pumpers, a lot of bashers and the like.

But both these individuals I found to be incredibly intelligent, and boy, was that a good call on my part. So we were both, all three of us were casually introduced by myself as a group. And in November of last year, we decided to break off from another Reddit weed stocks. subreddit and form the catalyst because we wanted a curated place for engaged investors that was deep. It wasn't people giving opinions without fact. So we actually formed the catalysts last November, very late November, early December last year and we've had quite a run of it lately. We have several platforms. We use our quarterly earnings analysis where I do complete

rundowns. I'm a credit guy by trade. I've been involved in international trade finance and supply chain management finance for over 30 years now. Mali time, Andrew, was 30 years in credit risk management and energy trading. So he knows the equity box. I'm a lender. I like to get repaid. So I know that fundamental credit analysis stuff. And when we added Graham to the mix, which does, he does our science side and our patent review. We became very, very three-dimensional. And so we've expanded that. Our Aspe Anything series has been phenomenal.

It is C-suite. We bring in the executive suites to talk about their companies, and our community asks them anything that like. And it's amazing the response we've had. We've had CFOs come on, and we asked for two hours. They give us six. which is amazing. Tracy, I was just going to say a credit analyst talking about cannabis,

kind of the perfect guest for the two of us. Oh, absolutely. And I love the credit risk manager with 30 years experience whose username is Molly Time. That's fairly unusual. It's named after his cat, actually. Just to take a step back for a second, why were you all on social media or on the Reddit forums

talking about pot stocks in the first place, what sparked your collective interest? Well, on my side, it was about inane accounting treatment of IFRS, International Financial Reporting Standards, where these companies growing cannabis at harvest were able to take the entire profit before sale, less the selling expense, through their income statement. I found it to be very, very misleading. So I dug into that and started commenting about that in the industry. For Andrew, it was more about a lifetime passion for cannabis and the stock market, quite frankly. And for our younger PhD candidate, it was about learning the finance side and applying the science to it. So all three of us came from a different place. We were very fortunate to meet each other.

So for those who haven't been following the ins and outs of pot stocks, can you maybe describe the state of the current cannabis industry? Like, where are we in terms of legalization and where are we in terms of companies actually getting started and producing and selling cannabis? Well, next week, October 17th, Canada will become the first G7 country to legalize adult use cannabis. We've had medical cannabis for a decade and under various regimes and the last four years under a pretty steady regime. And when Trudeau was elected, part of his platform was I'm going to legalize adult use cannabis. So we're a week away. It isn't going to go smoothly. In Canada, it's not California.

It's not Colorado. We have governments, provincial governments that have inserted themselves into the supply chain and are acting. like central warehousers and they're going to handle all the online sales. So that's a little different. But right now, the market extremely frothy. You've got to be very careful jumping into this market because as an investor, if you're a trader, you love the volatility. But as an investor, and I'm an investor, I'm not a trader.

Andrew is the trader in our midst. Like I look at it and the fundamentals, these companies are so far out over their skis right now on valuations versus fundamentals. And I think there's going to be some massive failures within the industry. And you've got to be very choosy about what you're investing in. I'm 52 years old. I don't have a lot of time to recover if I screw up. So I'm a little different than the 30-year-olds and the 20-year-olds.

Well, let's talk about this because I think the only two things that most people would know when they come to it is that the legal cannabis market is still fairly small around the world, certainly in the U.S., but there is pretty big potential for it to get much bigger as legalization expands. So everybody by now essentially knows that that's the story or that's the theme. But then you mentioned there are going to be a lot of failures. A lot of these companies are out over their skis. So if you're deciding among stocks, what is the first thing you do to actually sort of ascertain who's really going to be able to profitably exploit? this market. Well, I'm going to start with something that's probably the hardest thing to

evaluate, and that's management. Management is, everyone can print off a very nice looking CV that looks really good. A lot of companies, those CVs, the backstories for management look very, very good. But making sure you map what management says to what they actually do, to me, is very, very important, especially in a new industry. Like, I'm a big believer in jockey before horse and hope that the trainer gets the horse up to speed. And that's how I've approached it. And again, I'm a lot more cautious.

I'm a little older. I'm not going for the, I'm not looking for the biggest company. I'm looking for the most profitable company. Can I ask, you know, you mentioned management just then, how standardized are corporate practices of cannabis companies at the? point. You talked about IFRS accounting rules. There's certain guidance that comes with being a public company, but the vast majority of cannabis companies at the moment aren't actually public. So what are the disclosures like? What is the financial or corporate governance like?

The corporate government needs a lot of work, in my mind. There are some more professional companies like Constellation coming into canopy. I think was hugely important for that. I think it provides a lot more rigor to their operations, which I haven't been fond of, quite frankly. Constellations with four or seven board members, they're professionalizing that firm. And I think Tilray's another good example. Tilray, by the way, is the only one that does not report under IFRS because they went right to the U.S. markets with NASDAQ, and they're using good old U.S. Gap. So I love chatting with those guys.

It makes it a lot easier to look through their company. Afria is a very solid company. Aurora, interesting company. They have a lot of, they've done so much vertical integration. And you know, it's really fascinating about the industry is there's so many different races being run. And I'm amazed at the different races that are being run. Who knows who wins? But on a corporate governance, seriously lacking in the midcaps and small caps, there's some questionable stuff out there.

Well, explain that what do you say? multiple races being run. Let's get a little more granular. What are the different specific opportunities that people are competing for here? Well, let's look at the three, I'd say main players, although Tilrey's market cap would put them in a main player. Let's look at Canopy, Aurora, and Afria. Okay. Canopy wanted to be the biggest. They were first to do a lot of things, first to go public, first to acquire a new company, first to expand into Europe, first to get on the New York Stock Exchange or U.S. listing. So Canterby was about getting big, and it's big on both the adult use side in Canada,

but medical globally is going to be huge. And I don't think a lot of people appreciate that. And all of these companies are looking at medical globally. Aurora, on the other hand, one very massive facility that they've completed, Aurora Sky in Edmonton, they have some smaller facilities, and they've acquired a bunch of companies. They acquired C-Med. they acquired med relief.

And both of those were, I think CMed was a billion plus. Med relief was $3.5 billion for companies with 10 million in quarterly sales, 15 million in quarterly sales, which is nuts. Then you have Aurora, who have largely until this year really built to scale. And all they cared about was we're going to build our own facilities in Leamington, Ontario, the greenhouse capital of Canada. We're going to build them to scale. We care about EBITDA.

And as a traditional credit guy, EBIT does my drug of choice. I really like their management. And that's where I put a lot of my capital in. And I've revolved it around, but they still are my largest holding. And what do I like about them? They're a bit of the tortoise versus the hair with canopy, but I care about building scalable businesses. To me, there's a lot of hints that you can get from management,

even when revenue hasn't scaled, there's a lot of things you can pick up. And I just like the executive over there a little bit better. So when you look at the cannabis industry, is there a parallel conventional industry that you think it's most similar to? Is it maybe drug development like the pharma industry or is it potentially something more recreational? It is agricultural, it is pharma, it's consumer packaged goods. It's unlike anything I've seen, quite frankly, because you're going to be producing for a recreational market as you try to develop patentable strains and drugs for medical avenues. And to me, again, the medical side of this is the big plus. And once the U.S. takes the wraps off and lets Farma really dig in and analyze the plant, and, you know, analyze the 100 plus minor cannabinoids and what each one of those is capable of, I think that's

the big story. Rec is flashy. Rec is fun. It's the party cruise. Medical is a longer tunnel, but in the endgame, health, science, and wellness is going to be huge in this industry. Speaking of recreational marijuana, here's something that I've been curious about for a while. So right now, when it comes to alcohol or tobacco, people have. have some conception of brands that they like. Maybe I have a favorite beer and I drink it the most, but I certainly don't drink it every single time I drink beer. I'm curious what the expectation is on cannabis. Are people going to have brands that they really like, that they identify with something, that they are going to use all the time that will be difficult for smaller brands

to enter? Or are consumers expected to be more promiscuous, so to speak, and, you know, making it difficult for the various sellers to really establish large moats around their strains? That's a great question. Buying cannabis isn't like entering into a cell phone contract. You're not locked in for an extended period of time. So I expect a lot of brand hopping at the beginning. People settling in, there'll be the cores light of cannabis out there. And there also will be the Johnny Walker Blue Label.

We recently toured Broken Coast Cannabis, which Afria purchased for almost a quarter billion dollars earlier this year. And we have a video out on it. And they are by far the highest quality LP that we've ever toured and we've toured quite a few. I think they, given their history and their medical side patients, just love them, I think that's going to be, that's getting Broken Coast cannabis because it's not a big facility. is going to be like getting Hamilton tickets on Broadway. So good luck to everybody who can actually get their hands on some of that stuff. But there's going to be the Coors Light.

There's going to, vape pens aren't going to be legal in Canada for another year. Edibles won't be legal in Canada for another year. All we're going on for the first year for consumables is flour and oil. And it's not the oil that you're used to where you can vape in the States. It's diluted oil in a carrier oil form. So you can use it in baking and stuff like that. It isn't what you fill your vape pens with in the U.S. and vape off. Vap pens are going to be enormous.

And that's why all the greenhouse capacity is coming online. So I have a related question, which is about the notion that one of the defining things about wheat at the moment is just the sheer number of strains that are out there. And there are always new ones being created. Like that's pretty much what growers do is constantly crossbreeding different strains. And at the moment, if you're at least a recreational consumer, you probably base your choice on, you know, I like sour diesel or I like Girl Scout cookies and your options are probably limited to whatever your dealer happens to have available. So how does the sheer number of strains interplay with this brand loyalty that we were just talking about? Well, you know, I think the strain, the sheer number of strains is going to be a lot. different in California than it's going to be in Canada because we're going to have these 10

provincial buying authorities that are purchasing and you have to have enough volume to fill your skews with them. So I like for to give you an example, Broken Coast is only going to have five strains. That's it. The skew level though, I've been to Organogram and I think their skew level is somewhere around 42 to 52 skews to one province. But that skew level, because there's a loose roll, single loose rolls probably in half gram a gram size, there's a flower in a gram, probably an eighth and a quarter, there might be a complementary oil to that strain. So you're not going to get the strain selection that you see, I think, in California, because you have to fill the pipe and then you have to continually fill the pipe. And the problem is, like, from genetics to

product, you're probably looking at a year if they find something good. And we found that finding something good in genetics is one in a hundred to one in a thousand chance you get something very unique. So I think the strain selection, unfortunately, is going to be limited until we see some of the craft producers, which is the next round of regs allowing small batch craft guys into the market. And then it might fracture a little bit, but still these monolith provincial buying authorities, they think different. They think like alcohol and will we have hit records of strains for the summer?

I sure hope so. I think that would be fun, but you need a market that can react quickly. And I don't think Canada is going to be that market because of those monolithic buying entities that are between the grower and the consumer. I'm Francine Lacquhar, an award-winning journalist, and I've got a new podcast, leaders with Francine Lacqua from Bloomberg Podcasts. I've interviewed everyone from heads of state to fashion icons about the news of the moment. But I've always been curious, who are these people as leaders? I don't think there's one right way to be a leader. Make decisions. A poor decision

is always better than no decision. Listen to new web. episodes every other Monday. Follow leaders with Francine Lacois wherever you get your podcasts. God, I have so many questions right now. And I don't even, I'm trying to think which way to go. But I really want to drill down on that last thing you said, because I think this is really crucial for people understanding the market structure of Canadian cannabis. So they're going to be the LPs, the licensed producers who grow the stuff. You mentioned a few of their names. There are going to be private retail outlets who sell the stuff out on the street to people.

But then in between them, there are these state-run. provincial-run warehouses that ultimately are where the buyer and seller meet. Can you explain how that works? I get asked this a lot, and I always tell people, do not think like a retailer, do not think like a consumer, do not think like the company selling cannabis and growing it. You have to think like a greedy finance minister and a greedy provincial finance minister. And if you would think like a greedy provincial finance minister, a lot of this makes sense. Because if the LPs don't grow in your province and all the profits are going to land in the LPs laps in other provinces,

how do you relocate profits? Well, you insist on being a nanny state and centrally warehousing the product such that you can dispense it within your regs in province, because every province has different regulations on this. Not only that, these greets are. finance ministers are also taking on the all the online sales. So if you're a retailer like Medmen, which you're probably familiar with in the States, in Canada, the model is going to be very, very different. You're going to buy from just one source. So you don't get to compete out all your sources in order to drive down your prices. Then that source that's selling to you is going

to compete against you online. To me, you got to be very careful entering the retail space in Canada. there's a lot of people very anxious to do it. I'd be very cautious to do it because I think this is going to be, you're going to have to have a high volume, low margin business. Maybe it changes when edibles and the secondary products come in,

but I really worry for those companies that think they're going to do really well. And what we call it, we've been calling it is boxed in retail because you're boxed in by the seller to you, who's competing against you. It's an odd Canadian phenomenon. So just to be clear, when people are trying to wrap their heads around who's going to make the profits, it's really important to realize that the provinces have inserted themselves as essentially monopsony buyers of the product from the growers and monopoly sellers to the product, to the retailers. So just from a pure eco 101 standpoint, you could sort of figure out who's going to take a huge slice of the profits in the whole thing.

Plus, they're layering on an excise tax and a sales tax. So, yeah, you can figure out who's making the problem. And I love the folks in the States, too. I find them far more honest about why cannabis is going to be allowed eventually. It's about jobs. It's about taxation. In Canada, we've been saying it's about saving little Timmy from getting his hands on cannabis at the local high school. We're going to regulate it.

It's been very health-driven, which is a nice liberal message that resonates a lot. lot more. And I can see why it works better in Canada, quite frankly. But at the end of the day, I'm a capitalist at nature. And I find taxes and jobs really speak more to me than the health benefits. But there are. There's demonstrated drops in youth use when it becomes regulated. So we'll see. But yeah, don't mistake Canada for the U.S. So when it comes to selecting a successful Canadian cannabis company, is the thing you want to look out for then just first mover advantage and economies of scale and efficiency? I think it's low-cost production, I think, is going to be very key. This is going to be commoditized.

It was very sexy when people were like these LPs with very little competition were selling medically. Because on the medical stream, just to make the point, medical is still federally regulated. Medical only is sold from an LP online to a medical recipient who has a script. So that's not going to change when adult use comes up. That medical system, the direct delivery of medical marijuana, we're not in pharmacies yet. Shoppers, Drug Martyr, largest pharmacy chain has a license, but they're going to act like a central warehouser as well and shipped to all their customers of the pharmacy. So it was really nice selling things at $9 a gram that were costing $3 a gram.

That's a heck of a margin. But when the provinces come in and compress that margin, that sales price down to $450 to $350 a gram, you better be selling, producing sub-dollar in order to compete. So even if you want to farm it out, and compete. So these first movers are all scaling large sets of production, but their cost structures are wildly different. And so even with these large greenhouses coming online, it's going to skew the cost per gram of all these companies. But even if you don't want to grow it yourself, if you want to be big, you need access to enough. And enough, I'll put in really hard quotes there, low cost, good

supply. So this is going to eventually be a branding game when it gets to edibles and vapes and the medical products. But you need access to the supply, good premium, good quality supply at a good cost. And so first movers are important because they've scaled the most. They got access to all that capital. And they've built out. They've had a longer runway to build out. I'm very cautious about it, all the new entries. New entries in Canada, I've, extremely cautious about. All right. So we've sort of danced around this in the beginning and during this conversation, but we need to talk about the accounting treatment of gain on biologicals, because this is the first time that I actually tried to really work through the P&L statement of a

cannabis company. I forget which one I was looking at, maybe Kronos or something, right up at the top of the income statement. I ran into this thing. I didn't understand this profit from gain on biologicals. And then you and I went back and forth on DM for like 30 minutes and you tried to explain it to me. But for anyone in the U.S. investing in a Canadian company that doesn't use a gap, but IFRS, explain what this line is and how crucial it is to understanding this line in order to sort of judge the true profitability of the company. Yeah, first of all, it's ludicrous. It's meant for, think of a tequila producer where their agave takes years and years. to grow. Cannabis grows in a 12 to 14 week cycle. So this is an agricultural phenomenon and it's

also in livestock as well. And what it allows the producer to do is, and I'll just talk about at harvest because it also impacts the growing plants, but the at harvest is the big dollars. So at harvest, they get to treat it like they sold it and they get to capture the profit, less any selling expense. So that would be like going into an ACE hardware in the States. And ACE hardware has already taken profit for everything that sits on their shelves, less the selling expense. That's ludicrous. So there's two items that you have to look for. And I always use gross margin. When I do my trend analysis and my line analysis, I use gross margin before IFRS Voodoo, as I call it, because there's two items. There's the gain on biologicals. So that's,

all the growth in the plant material, the unharvested plants, which is smaller than the harvested plants. So they're taking profit as they grow, not as they sell, and you only get to take profit once. You don't get to take it multiple times. Then the other line item is fair value increment on goods sold in that quarter. And what that is is showing you how much profit they took when they actually harvested it versus when they sold it. So I'm always looking at management. We talked about management earlier. If their production costs plus their fair value increment is greater than their quarterly sales,

it means they were far too aggressive when they took the gain on biologicals in the first place. And it tells you a little bit about the company. If they're going to be that aggressive taking all the profit at harvest, You look at Canopies vault. Canopy has 100 million plus in cannabis. All the profits gone. So everyone who thinks, oh, they're going to sell all that cannabis in the quarter one and quarter two of recreational, and they're going to make gobs of money.

No, no, no, no. They already took all that profit. So it's very important when you're looking at this. I always use adjusted EBITDA. That is my drug of choice. It takes a lot of noise out of the equation, including gain on biologicals and fair value increment. But it's insane. to actually accept, even when it was just medical, the product gets harvested,

it has to still pass QAQC, quality assurance, quality control, and that takes four to five weeks. And unlike other agricultural goods, there's no futures market. So how do you actually figure out what the selling prices? So that was all left to management. And it was all over the place. And to me, there's way too much noise in that to not back it out when you're doing your analysis. So I wanted to ask you about how the cannabis industry fits into the existing financial infrastructure.

You mentioned there's no futures market at the moment. There also isn't a lot of analysts discussing the cannabis industry at the moment. And Joe alluded to this in our intro, but that's one of the reasons why the catalyst is so interesting because you guys are doing this analysis in a lot of detail in a way in which Wall Street just isn't. at the moment. Why do you think Wall Street is sort of behind on this one? Is it purely a question of the legality of the industry? I think they just found religion. Until Canopy and Cronos listed in the U.S., Canada was an afterthought. And so you get canopy listing and Jim Kramer talking it up. Then you get Kronos and then you get Tilray. My, my, my, my, what a story that was.

And you know what? I'm flattered that you think we're doing it well because I got to tell you, the people that I'm watching on the business shows in the States are doing it so poorly. They are not talking about fundamentals. They're not talking about the fact that, like Tilray, for example, the last quarter, they ended the quarter with a finished goods inventory of $89,000 in flour and $416,000 in oil extracts. No one's mentioned that, but if you're about to ramp up for rack and it takes you four to five weeks after your harvest and you're sitting on under a day's worth of sales of finished goods, you've got some issues. And I love the Tilray guys and they'll get it figured out. They're very professional and their executive is fabulous. But not one mention of something like that. Not one mention in the media about waste.

Even the Canadian media has been sadly lacking. Like I said you can measure management without the financials in certain aspects. If you follow waste and you track through and dig through the MDNAs management discussion analysis and the financial notes like we do, you can sometimes pinpoint how much waste these companies have. And some of them are over 26%. That's a little high if you're going to be at a consumer packaged goods industry. So I really think the little bit of the little bit of the little bit. listings in the U.S. created the interest. I think the talking heads are talking heads. They

really don't know what they're looking at. They're fueling hype. And I got into this industry because I didn't want to see Joe retail get taken advantage of. And that IFRS to me was people getting taken advantage of. And so some of the cheering that's going on to me is a little irresponsible. it's bringing people into the market because it's hot and topical, not because it might be a good investment for their portfolio. All right. So quick comment and then two very quick questions. First of all, I take that as a personal challenge as a business TV show co-host to not be one of the talking heads and to actually live up to your standard.

So I appreciate that comment. It's something to strive towards. As for the two questions, one is A, what is the future of the catalysts and where are you going to take it next? And B, I just have to go back. You were talking about like what's going to be the hit strains. So like is there a career where people can smoke pot and say, okay, this is really fantastic stuff? Wow. I'll answer the first.

First of all, I hope you dig deeper at the end of the day until. Until it's about the investor and not about the hits and the clicks, I think it behooves us to educate the investor because they are at such a disadvantage compared to the institutionals. Now, I'll deal with your second one. It would be great. And I think there's a lot of gamers out there that would say, hey, it would be a nice adjunct to gaming if I can also comment on strains. And there is some strain review out there. What I can't wait for is for the myths to get busted. And there be actual like Pepsi Coke challenges where it isn't just preconceived notions.

I can't wait for that. I think that's going to be very interesting. As to the future of the catalyst, in a year, we actually have a trade conference that we're doing in Leamington, Ontario, which is a small hamlet just outside of Windsor, Ontario, which is about 45 minutes from Detroit. We're actually doing a trade conference there with Grant Thornton. This is within a year. We just released a video last week. And I can tell you if I told my partners back last November,

hey, by the end of the year, we'll have videos released and we'll be doing a trade conference. They would have hung up on me. So we're going to go as far as our imaginations can take us. And as far as our community will allow us to go. We're really focused on providing content. to our community and making sure that they like what we do. And so I don't know where we're going next, quite frankly. It's very flattering that people like you, Joe, that listen to me.

My wife and my kids don't listen to me, but it's nice to know that there are some people out there that find what I say and what Andrew and what Graham say as valuable in their investment decisions. Well, we wish you luck, and I really appreciate you coming on. And like I said, I do think it's important that the media moves beyond the hype and actually helps to educate people about what these companies are. So really appreciate your explanation. Craig Wiggins, thanks for coming up. Thank you very much for having me.

It's been a pleasure. Tracy, I thought that really was like the perfect blend of my and your interest. You know what I was really surprised about? We managed to go through that entire podcast without, I think, making a single marijuana pun. You know, I'm so proud of us because I'm so tired of marijuana puns. And I think it speaks to the degree of seriousness with which we take it and the maturation of the industry. And I just, I'm trying to kill marijuana puns every time I see them in titles or articles.

Oh. So, no, they're bad. So I think that really does speak well of us that at no point in the conversation. did it occur to me to make one. Right. There's one other thing that I was thinking throughout that discussion. Obviously, we were focused on the financial and the business aspects of an entirely new industry. But if you take a step back, it's also just really interesting to watch cultural and societal norms basically changing in our own time. You know, think back to 20 or 30 or 40 or 50 years ago in the way people talked about pot marijuana, you know, refurbateness.

People honestly thought that marijuana was something that was going to destroy entire societies. And now we're talking about the degree to which it should be legalized and basically incorporated into some people's daily lives. It's pretty amazing. Well, literally, NYSC listing for a marijuana dealer is like about the pinnacle of cultural acceptance, I would say. So you think of like nothing could be more normy and conservative than NYSC listing. And so I think there's something, even though it's not fully legal or not legal across the United States yet, it's almost like that's even more striking. It's fully arrived by that point. Right. Or quality control for a Canadian provincial government. Yeah,

or like IFRS treatment of how you account for from when you plant the marijuana to when it's sitting as inventory. It's pretty entrenched. It's here. Yeah. All right. Well, this has been another episode of the Odd Lots podcast. I'm Tracy Allowway. You can follow me on Twitter at Tracy Allaway. And I'm Joe Wysenthal. You can follow me on Twitter at the stalwart. And you can follow our guest, Craveldlop. Wiggins on Twitter. He is at Go Blue CDN. And you should follow our producer Tofer Forges

at Forges T as well as the Bloomberg head of podcast Francesca Levy at Francesca today. Thanks for listening. You can get the news whenever you want it with Bloomberg News Now. I'm Amy Morris. And I'm Karen Moscow here to tell you about our new

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