Okay, buddy. So this is a story about how some companies that sell weed or things related to it told everyone how much money they made last year. People were happy because most of them did better than expected with their money stuff. When the companies shared this news, their stocks went up or down depending on how good or bad the news was. The story also says that there is a connection between how much money the company makes and how its stock price changes. Read from source...
1. The author uses a vague term "generally positive" to describe the earnings results without providing any specific details or numbers to support this claim. This creates a sense of uncertainty and lack of credibility in the article.
2. The author claims that there was a ".75 correlation between EBITDA surprises and stock performance", but does not provide any evidence, data, or statistical analysis to back up this statement. This is an unsupported assumption that could be easily challenged by someone with knowledge of correlation coefficients and their significance levels.
3. The graph shown in the article is confusing and misleading. It shows three different bars (% revenue beat, % EBITDA beat, and percent revision to 2024 EBITDA estimates) without clearly explaining what each one represents or how they relate to each other. Additionally, the green line showing the net percent change in stock price is not labeled with any units or scales, making it difficult to interpret its meaning or significance.
4. The title of the article is misleading and sensationalized. It implies that the market reacted rationally for a change, suggesting that this is an unusual or unexpected occurrence. However, this contradicts the main argument of the article, which states that the market has been behaving irrationally in recent years due to factors such as over-speculation and hype. A more accurate title would be "Cannabis Market Reacts Rationally To Q4 2023 Earnings Releases" or something similar that reflects the content of the article without making false or exaggerated claims.
- Cannabist Holdings (OTC:CBSTF): Buy, high growth potential, but also high risk due to volatile market conditions and regulatory uncertainty. The stock has a strong correlation between EBITDA surprises and stock performance, indicating that the market is rewarding its positive earnings surprise
- Green Thumb Industries (OTC:GTBIF): Buy, similar to Cannabist Holdings, but with a more diversified portfolio of products and markets. The stock has also shown a strong correlation between EBITDA surprises and stock performance, indicating that the market is rewarding its positive earnings surprise
- Tilray (NASDAQ:TLRY): Sell, high valuation and low growth potential compared to peers. The stock has a weak correlation between EBITDA surprises and stock performance, indicating that the market is not impressed by its negative earnings surprise
- Aurora Cannabis (NYSE:ACB): Hold, moderate growth potential, but also high debt levels and regulatory uncertainty. The stock has a weak correlation between EBITDA surprises and stock performance, indicating that the market is not rewarding or punishing its earnings surprise
- Aphria (TSX:APHA): Sell, low valuation and low growth potential compared to peers. The stock has a weak correlation between EBITDA surprises and stock performance, indicating that the market is not impressed by its positive earnings surprise