Please ensure Javascript is enabled for purposes of website accessibility

Why Marijuana Stock CannTrust Holdings Popped Today

By Joe Tenebruso – Updated May 14, 2019 at 6:14PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The cannabis company generated a surprise profit.

What happened

Shares of CannTrust Holdings (CNTTQ 7.69%) climbed 6.5% on Tuesday, following the release of the marijuana producer's first-quarter results.

So what

CannTrust Holdings' net revenue surged 115% year over year to $16.85 million Canadian ($12.5 million), driven by a 57% rise in its medical net revenue and a ninefold increase in its wholesale revenue. 

CannTrust Holdings' total active patient count rose 70% to 68,000 people. The Canadian marijuana producer sold more than 3,000 kilograms of dried cannabis equivalent -- a nearly 200% year-over-year increase -- at an average net price of $5.47 per gram during the first quarter. 

In turn, CannTrust delivered a surprise profit of CA$12.8 million ($9.5 million), or CA$0.12 per share. Analysts had been expecting a loss of CA$0.05 per share. 

A cannabis leaf on top of a $100 bill

CannTrust Holdings is turning weed into profits for investors. Image source: Getty Images.

Now what 

CannTrust's harvested production increased by 96% from the fourth quarter of 2018 and more than 400% year over year, to over 9,400 kilograms. The company said it expects to boost production capacity to 50,000 kilograms annually by the third quarter of 2019. 

CEO Peter Aceto said CannTrust's recent stock offering would allow it to further increase capacity in the years ahead. "With the successful closing of our equity offering providing gross proceeds of US$170 million ... we are well positioned to execute on our growth plans," Aceto said.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool recommends CannTrust Holdings. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

CannTrust Holdings Inc. Stock Quote
CannTrust Holdings Inc.
$0.00 (7.69%) $0.00

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/29/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.