Higher Exchanges Water Tower Research

It's a quieter time in cannabis, but this was a fun show. We started by reviewing the 4/20 holiday, focusing on the revenue lift and which categories performed best. Beverages were a top seller, and the guys debated the category's future and who will drive its growth. 

We debuted a new game called "buy or sell" that led to several fun debates on rescheduling probabilities, how to play a potential rescheduling bounce, when Florida may eclipse California in legal cannabis sales, and whether dispensaries will exist in twenty years. 

The trichome trio is home from the Benzinga Cannabis Capital Conference in Florida and the show starts with their biggest takeaways from the event.  The conversation evolves into a spirited discussion on where we stand on Schedule III. The guys debate the probability of landing on Schedule III and the time frame in which it may happen. The episode concludes by talking about the AGP sentiment survey and what everyone is doing for the 4/20 holiday. 

2024 is the year of potential cannabis catalysts and we had Hirsh Jain, Founder of Ananada Strategy join us to discuss a bevy of federal and state-level opportunities. Next week is 4/20, and one potential time that the DEA could respond to the HHS' Schedule III recommendation. The trio debates the probability of a response and the implications to short and long-term investors. 

On the state side, we tackle Ohio first, and the exciting news that adult-use sales could start as soon as July 2024. Hirsh sees this as a big market, and potentially very profitable due to the reasonable regulatory structure. The conversation evolves into the biggest state-level catalyst, Florida. This massive market may flip to adult-use in 2025 and Hirsh walks us through how he sees the vote potentially happening and the factors determining if it gets to the 60% threshold. We close the conversation handicapping Pennsylvania and when this legislative process could approve adult-use sales and implications for the publicy-traded operators. 

This week's show starts with a recap of adult use making the ballot in Florida and what it may mean to the industry. Morgan shares his perspective after recently visiting the Sunshine State. We cover the pros can cons of the mandatory vertical market and opportunities for smaller companies like Sunburn to expand if adult use succeeds. Toby gives his thoughts on how Florida will expand the TAM and drive revenue, especially to the tier-one operators. 

AYR Wellness President and CEO David Goubert and VP of Public Engagement Rob Vanisko join twenty minutes into the episode. They offer AYR's perspective on getting on the ballot and review AYR's Florida assets. AYR also has significant exposure in Ohio and Pennsylvania and the team updates us on where we are in these respective processes and how the company is positioned in each state. Toby asks David how they are planning around Schedule III, and their current tax strategy. Finally, Morgan thanks the AYR for recently joining the Boises lawsuit and shares how others can contribute to this case. 

Of course, the show ends with another captivating Ask Grok segment. 

Jesse starts the show by sharing his experiences visiting LEEF Brands and Gold Flora. LEEF is a leading producer of concentrates in California and he went to see their 12,500-square-foot extraction facility in Northern California. Gold Flora is a top vertically integrated California company and Jesse shared his experience seeing their stores and cultivation facilities in San Jose. 

Sam Armenia, known as Sammy J on X and VP of Corporate Development at C21 Investments, joins the show to share his perspective on Schedule III implication and potential adult use in Florida. He has done some interesting math on how Schedule III will unlock cash flow and we discuss how these funds can be deployed to grow revenue. We also cover how the Florida Supreme Court did not opine on cannabis today and we will find out next week whether it makes the ballot. 

The show concludes by asking Grok what happens if the Florida Supreme Court does not respond in time for a deadline. 

The show kicks off with Toby sharing his experience at the ROTH Conference this week in Dana Point, California. We discuss how institutions are beginning to look at cannabis, but it will take federal reform for most to spend more time and resources on due diligence. Jesse and Morgan also talk about things it takes to win in the difficult California market. 

TerrAscend Executive Chairman Jason Wild and CEO Ziad Ghanem join the show to cover their most recent results. The team provides an overview of the quarter, including a conversation about the cultivation issues in Maryland. Ziad shares his insights on how the wholesale business is evolving, with New Jersey showing significant strength. Toby asks about tax strategies and Jason explains how they are treating past 280E payments and the plan moving forward. The conversation concludes by talking about opportunities in Ohio and whether TerrAscend is considering Florida if adult use ends up on the ballot and ultimately passes. 

Finally, the show ends with an Ask Grok that you won't want to miss!