Short sellers circle cannabis stocks as profits dwindle

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Wall Street's love of cannabis appears to be going up in smoke as vaping-related ailments and missed revenue projections are prompting short ...

NEW YORK: Wall Street's love of cannabis appears to be going up in smoke as vaping-related ailments and missed revenue projections are prompting short sellers to raise their bets against the industry, fund managers and analysts said on Wednesday.

A pushback on vaping could put further pressure on companies such as Curaleaf Holdings Inc and Aurora Cannabis Inc , whose stocks suffered drops of 10per cent or more after missing revenue projections in their most recent quarters. "We've been through the golden ages in the sector where you had high growth models and unsustainable price speculation because it was a hot new idea," said Michael Underhill, chief investment officer at Capital Innovations, who has focused on cannabis stocks."Now the gold rush talk is gone and you're going to see a rationalization of the business.

 

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