A humorous look at the companies that caught our eye, for better or worse, this week
Canopy Growth Corp. (DOG)
Business quiz! Shares of Canopy Growth, Canada’s largest cannabis producer, fell after: a) a new study found that cannabis use is associated with serious memory and concentration problems; b) the company reported a wider-than-expected fourth-quarter loss of $323.4-million or 98 cents a share as recreational cannabis sales fell about 4 per cent from the third quarter; c) a new study found that cannabis use is associated with serious memory and concentration problems. Answer: b.
Crude oil (STAR)
The U.S.-Iran conflict so far: Norwegian- and Japanese-owned oil tankers are attacked near the Strait of Hormuz in what may or may not have been an Iran-backed operation; Iran shoots down an unmanned U.S. military drone that may or may not have been in Iran’s air space; U.S. President Donald Trump calls off a retaliatory strike against Iran that he may or may not have been serious about in the first place; crude rises sharply amid speculation that oil supplies may or may not be interrupted by the escalating conflict.
SIR Royalty Income Fund (DOG)
True or false: When it’s pouring rain, a fun thing to do is gather with friends on an outdoor patio and get soaking wet. Answer: false. Citing unseasonably cool and wet weather that caused a “late start to the patio season," SIR Royalty said same-store sales at its flagship Jack Astor’s casual dining chain fell 3.9 per cent for the 12 weeks to May 5. With third-party food delivery apps and menu price hikes tied to minimum wage increases also affecting sales, SIR’s stock is getting drenched.
S&P 500 (STAR)
Interest rates are going up! Sell! No, wait. Rates are going down! Buy! In a dramatic reversal from a few months ago, investors are now expecting the U.S. Federal Reserve to cut its benchmark interest rate. The speculation intensified this week when the Fed cited increased “uncertainties” in the economic outlook and chairman Jerome Powell declared that “the case for somewhat more accommodative policy has strengthened,” sending the S&P 500 to a fresh record. Please try to follow along, people.
Snap Inc. (STAR)
Investing in Snap used to be as much fun as getting a text from Anthony Wiener. Now, the messaging app – whose stock got crushed in 2017 and 2018 – is back in Wall Street’s good books. Boosted by an improved user interface and new games and photo filters, Snap has soared more than 160 per cent this year. The shares got another boost this week when BTIG analyst Richard Greenfield hiked his target to US$20 from US$15, saying “too many investors [are] continuing to ignore Snapchat’s recovery.” At this rate, the stock might even get back to its IPO opening price of US$24 in March, 2017.