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OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS

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Chart of the Week

Chart of the Week

The Viridian Capital Chart of the Week highlights key investment, valuation and M&A trends taken from that week’s Deal Tracker that we believe are impactful for investors, companies and acquirers.

Week ended 11/14/2025

Viridian Capital Chart of the Week: A Counterintuitive Response to the Hemp Ban?

  • The Viridian Chart of the Week looks at the sharp decline in MSO stock prices during the week ended 11/14/25 (red line measured on right axis), the percentage above the 52-week low (green bar measured on left axis), and the percent gain required to reach the 52-week high (yellow line measured on left axis).
  • The red line shows that the stock prices of the twelve MSOs on the Chart declined between 9% for Ascend and 40% for TerrAscend. Given the news about the hemp ban, we would have expected that the companies that had jumped into the hemp drink business, including GTI, Trulieve, and Curaleaf, would have experienced the largest declines. However, the graph shows that this is not the case.
  • The significance of last week’s stock declines can be seen by comparing the red line with the yellow line, which shows the percentage gain from current prices that would be required to reach the 52-week high. The largest decliners of the week correspond to the companies (Cannabist and TerrAscend) that would require the largest percentage gains to return to their 52-week high. Conversely, the companies with the smallest weekly declines (Glass House and Ascend) also have the least required percentage gain to achieve their previous 52-week high.
  • But what triggered the decline? Clearly, a market driven by retail investors with abysmal liquidity makes this attribution difficult. It may have had to do with option expirations, the risk-off lean of the overall stock market, or any number of factors. But the one news story that dominated the cannabis press was the virtual ban of hemp products.
  • The initial reaction of most operators seemed to be schadenfreude followed by “we told you so”, and neither of those is surprising. After all, the licensed operators had been using the rise of hemp as a reason for the lackluster growth of the industry for a while. Doubtlessly, hemp really did bleed off some of the legal cannabis demand.
  • So, shouldn’t cannabis stocks have gone up this week? And isn’t it plausible that this was a gating item that needed to be cleared before rescheduling?
  • Our theory is that the sneaky way in which the hemp ban was achieved – suddenly and in the dead of night with zero debate- spooked the relatively low information cannabis investor base. It reminded us of how catastrophic it can be to be on the wrong side of political risk. It made people wonder if other nefarious things were in stall for the licensed operators. One of the factors we have advanced for why we think Trump will follow through on his rescheduling promise is the notion that he is commercially minded and naturally drawn to a growing industry that employs hundreds of thousands and generates many millions of tax dollars. Or that he is a champion of states’ rights. But none of that helped the hemp industry.
  • We do think the hemp ban will be good for regulated cannabis, even though we believe that a significant percentage of hemp revenue will go back to the illicit market rather than the licensed market. And we still believe that rescheduling is going to happen. So are we loading up our portfolios at what seems a fabulous opportunity? If only we hadn’t seen this movie so many times before.