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Why these ASX cannabis shares are rocketing higher today

Cannabis shares

One area of the share market that is performing better than most on Thursday is the cannabis industry.

A number of cannabis-related shares are trading notably higher today. Two in particular that have caught the eye are listed below. Here’s why they have stormed higher:

The MGC Pharmaceuticals Ltd (ASX: MXC) share price surged 10% higher to 5.4 cents after providing a positive update on its Pharmaceutical operations. According to the release, the company has been reaping the commercial benefits of its signed distribution agreements with Health House International and Cannvalate. This has led to total purchase orders of ~$300,000 being received during the first month of operation.

Management believes that this “is testament to the quality and affordability of MGC Pharma’s products that ensure doctors remain confident when prescribing to patients, and reflects strong immediate demand from the market.” MGC Pharma is focused on developing affordable cannabinoid derived medicines.

The THC Global Group Ltd (ASX: THC) share price rocketed over 20% higher to 53 cents this morning after emerging from its trading halt. Investors have been buying the diversified cannabis company’s shares after it announced that its wholly owned subsidiary, Canndeo Limited, has been granted a Manufacture Licence for the production of extracts and tinctures of cannabis and cannabis resin from the Australian Office of Drug Control.

The company regards this as a major milestone as it represents the completion of its Farm to Pharma vertical integration strategy. This means that THC Global is now able to cultivate its own proprietary strains, process cannabis plant material, and manufacture extracts and tinctures from cannabis. The company also advised that it remains on target to be undertaking product validation production towards the fourth quarter of 2019.

Elsewhere in the industry on Thursday, the Cann Group Ltd (ASX: CAN) share price is up 1% and the Althea Group Holdings Ltd (ASX: AGH) share price has risen a further 3.5% following a positive update on Wednesday.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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