OUR 8TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / CBD / PSYCHEDELIC SECTORS

Capital Raises

Past Charts

Capital Raises

Capital Raises Summary

Each week, Viridian publishes insights and analysis on completed capital raise transactions in the prior week, focusing on all equity and debt deals. Our analysis includes:

  • YTD Analysis
  • Sector Focus
  • Capital Raises vs Equity Prices
  • Outlook
  • Sector and Company Performance
  • Capital Raises by Sector

Quick Links

YTD Analysis

Week ended 04/08/2022

  • Transactional ActivityThere was one less transaction but a $366.0 million higher volume than the prior week. Compared to last year’s same week, ten fewer transactions closed with a $38.1 million lower volume. The average deal size was $123.8 million this week vs. $31.5 million in the same week last year. The $345M equity issuance by Innovative Industrial Properties dominated this week’s totals.
  • The cannabis equity markets finally reacted to the rampaging inflation, an increasingly brutal war in Ukraine, and increased talk of a potential 2023 recession (despite the 2/10 yield curve reversing its inverse curvature.)  Cannabis stocks, as measured by the MSOS ETF, were down 6.09% for the week. The MSOS is now down 22.9% for the year.
  • We continue to believe that the chances for meaningful legalization or banking reform will be slight for the rest of the year. Continued consolidation activity is a better bet to support the market, and we continue to believe other significant public/public deals will occur in 2022.

 

  • Cannabis capital raises are off 69% YTD, slightly improved since last week due primarily to a $350M IIPR equity issuance. Reduced equity issuance (down 76% y/o/y in the U.S. and 95% in Canada) was partially compensated for in the U.S. by solid debt issuance (up 392% y/o/y, however, Canada’s debt decline of 95% brought total debt issuance down by 22%l. As the graph below shows, capital raises for the first fourteen weeks of 2022 were dominated by U.S. activity. Additionally, a higher percentage of capital raises came from international locations than any recent year’s corresponding period.

  • There were only three closed capital raises for $371.4M this week, and approximately 93% of the total raised was due to the $345M Innovative Industrial Properties (NYSE: IIPR) deal. The graph below clearly shows the sea change in financing as debt (light green) replaced equity (dark green) as the market slid.

                                                                                                            

  • Cap Raises by Sector:

Market Commentary and Outlook

This Week Sector Focus

Capital Raises vs Stock Prices

  • There were only three closed capital raises for $371.4M this week, and approximately 93% of the total raised was due to the $345M Innovative Industrial Properties (NYSE: IIPR) deal. The graph below clearly shows the sea change in financing as debt (light green) replaced equity (dark green) as the market slid.

Best and Worst Stock Performers