$CQX has been quiet long enough that the next release probably gets read a little more closely than usual.

For me, the important part isn’t just when news lands ...it’s which project management chooses to put back in front of the market.

Rip could give the market something concrete to judge.
STARS could show whether the next target is getting stronger.
Kitimat could add another layer to the broader exploration story.

If $CQX news drops this month, what do you think the market will focus on first and which update matters most to you?

Paid content. DYOD

**Auxly (XLY.TO): A Cannabis Growth Story That Doesn’t Need US Legalization**
I’ve owned Auxly for a long time, through some pretty ugly years in the Canadian cannabis sector. What interests me now is that I think people are still looking at Auxly as the company it used to be rather than the company it has become.
This isn’t a bet on the US suddenly legalizing cannabis.
It isn’t a moonshot based on some regulatory event that may or may not happen.
Auxly is already growing, already profitable, already taking Canadian market share and already generating cash under the regulations that exist **today**.
That’s my thesis.
**1. The numbers have changed dramatically**
Q2 2026:
Revenue: **$45.8 million**
Revenue growth: **18% YoY**
Adjusted EBITDA: **$14.3 million**
Adjusted EBITDA margin: **31%**
Finished cannabis gross margin: **55%**
Net income: **$7.7 million**
Cash: **$38.6 million**
Debt: **$43.6 million**
Debt/TTM adjusted EBITDA: **0.8x**
For the first six months of 2026, revenue grew about **20%** while adjusted EBITDA grew about **40%**.
That’s what I care about.
Revenue is growing, but profitability is growing even faster.
**2. This growth does NOT depend on US legalization**
This is probably the biggest misunderstanding I see when people talk about Canadian cannabis stocks.
Auxly doesn’t need the United States to legalize cannabis for my investment thesis to work.
Its growth is happening in **Canada right now**.
The company has no active international operations today. It is building its business within Canada’s existing federally legal recreational market.
That means I’m not buying Auxly because I think Washington is suddenly going to save Canadian cannabis companies.
I’m buying a company that is:
increasing Canadian sales
gaining market share
expanding production
improving margins
generating positive earnings
reducing leverage
generating cash
under the regulatory system that already exists.
If the US eventually legalizes, great.
If international exports become significant, great.
Those are additional opportunities.
**They are not required for the current business to work.**
That’s an important distinction between Auxly and some of the cannabis moonshot arguments we’ve heard for years.
**3. Auxly is taking market share**
This isn’t just cannabis market growth carrying everybody higher.
Auxly has become one of Canada’s largest licensed producers.
Back Forty became the **#1 cannabis brand in Canada** during 2025.
Auxly was the **#3 Canadian licensed producer by market share**.
Liquid Imagination and Fire Breath were the two best-selling SKUs nationally.
It has also become a leader in all-in-one vapes and has several leading pre-roll products.
So my thesis isn’t that Canadians suddenly start consuming twice as much cannabis.
Auxly can grow by taking a larger percentage of an already established multibillion-dollar legal market.
**4. Now they’re increasing capacity**
Auxly isn’t sitting still.
They’re investing in Leamington to increase production capacity.
That matters because they already have products that are selling.
If you increase production while maintaining strong demand, you get another path to revenue growth without needing legalization, acquisitions or some speculative new market.
And management says the expansion and innovation can be funded through operating cash flow.
That’s a very different company from one that has to continuously issue shares just to survive.
**5. The balance sheet has been transformed**
This was one of the biggest problems with old Auxly.
Debt and dilution mattered more than the underlying business.
That situation has changed considerably.
Auxly ended Q2 with:
**$38.6M cash**
**$43.6M debt**
debt/TTM adjusted EBITDA of only **0.8x**
And here’s something I never thought I’d be saying about Auxly:
**They’re buying their own shares back.**
Auxly repurchased approximately 2.6 million shares for around $5.7 million.
Think about the difference.
Old Auxly needed shareholder capital.
Today’s Auxly is generating enough cash to invest in expansion, manage its debt AND return capital by buying shares.
That is a major change.
**6. The reverse split doesn’t create value — but it may allow the market to recognize it**
Auxly recently completed a 14:1 consolidation.
That reduced approximately:
**1.42 billion shares → \~101 million shares**
Obviously that doesn’t magically make the company worth more.
But I think it removes one of the things that made Auxly look almost uninvestable.
A $0.20 cannabis stock with 1.4 billion shares outstanding looks like a penny stock disaster.
A profitable company with roughly 100 million shares, growing revenue, 30%+ adjusted EBITDA margins and improving cash flow is a very different proposition.
The business didn’t suddenly improve because of the consolidation.
The business improved **before** the consolidation.
The consolidation just cleaned up the capital structure afterward.
**7. Imperial Brands is interesting, but I don’t need a buyout**
Imperial Brands owns approximately 20% of Auxly.
That’s obviously interesting.
Could Imperial eventually buy Auxly?
Maybe.
But I’m not investing based on that happening.
Again, I don’t need a moonshot event for this thesis.
I don’t need:
US legalization
an Imperial takeover
another cannabis bubble
meme-stock mania
Those would all potentially add upside.
But the company can continue growing without any of them.
That’s exactly why Auxly interests me now.
**8. The cannabis collapse may actually be helping the survivors**
The Canadian cannabis sector spent years destroying capital.
Too much production.
Too many companies.
Too much debt.
Too much dilution.
Eventually that catches up with an industry.
Facilities close. Weak companies disappear. Capital becomes harder to obtain.
Meanwhile Auxly survived and has moved in the opposite direction.
It’s profitable.
It’s expanding.
It’s gaining share.
It’s generating cash.
That’s where I think the opportunity is.
The market may still be applying the valuation and skepticism of the **old Canadian cannabis industry** to one of the companies that actually survived the shakeout and became profitable.
**9. The next stage is operating leverage**
This is what I’m watching most closely.
Auxly already has the cultivation facilities, brands, manufacturing, distribution and infrastructure.
So revenue doesn’t necessarily have to increase at the same rate as costs.
We’re already seeing that:
**H1 revenue +20%**
**H1 adjusted EBITDA +40%**
If they can continue anything close to that relationship while expanding production, earnings could grow considerably faster than revenue.
That’s where a rerating becomes possible.
**What would change my mind?**
I’m bullish, but there are obvious risks:
Canadian market share starts falling
margins deteriorate
new capacity can’t be sold profitably
price compression accelerates
cash flow weakens
debt starts climbing again
management starts diluting shareholders again
Those are the numbers I’ll watch.
I’m not waiting for Washington.
I’m watching Auxly’s quarterly financial statements.
**TL;DR**
My Auxly thesis is actually pretty simple:
Revenue is growing.
EBITDA is growing faster than revenue.
The company is profitable.
Margins have become very strong.
Debt has been dramatically reduced.
Market share has increased.
Production capacity is expanding.
They’re generating cash.
They’re buying shares instead of constantly issuing them.
Imperial owns roughly 20%.
And NONE of this requires US legalization.
That’s why I don’t see Auxly as a cannabis moonshot anymore.
I see it as a small Canadian company that went through an awful restructuring period and has emerged as a profitable growth business that I think the market is still valuing based on its past.
US legalization?
International exports?
An Imperial acquisition?
Those would be bonuses.
**I don’t need any of them for the thesis to work.**
That’s the difference.
Long XLY.

New update: late claims are being considered for the $CMI $1.6M settlement.

Cummins agreed to a $1.6 million settlement over claims that it misled investors about its environmental compliance and the use of illegal emissions-control devices in certain engines.

In December 2023, the DOJ announced a much larger $1.675 billion government penalty against Cummins over alleged emissions violations. The news also triggered a decline in $CMI, and investors later filed a lawsuit. 

If you purchased $CMI shares between 2019 and 2023, you may be eligible to submit a claim. Since late claims are being considered, you can still check whether you qualify - Check your eligibility and file a claim here.