GLJ Research founder Gordon Johnson joined Benzinga’s PreMarket Prep show on June 23. During the discussion, Johnson weighed in on Canadian cannabis stocks, which have made a major comeback since the market bottom in March.Johnson said the best data on the Canadian cannabis market is from Stats Canada, and recent trends are not encouraging.”In March, Canadian cannabis sales skyrocketed. What happened? Everybody got scared. They thought we were going to be locked in for a long time, so people stocked up on inventory,” Johnson said.Cannabis Stocks RallyAs a result, cannabis investors thought the Canadian market had finally reached a turning point after sales growth softened throughout 2019. Canadian cannabis stocks, including Tilray Inc (NASDAQ: TLRY) and Aurora Cannabis Inc (NYSE: ACB) surged higher on the March sales data.”So then, fast forward and we got April sales data last week. Guess what? Sales down in April,” Johnson said.Given the large cannabis inventory levels in Canada, Johnson said cannabis stocks need consistent growth in sales or cannabis prices will face significant pressure. New cannabis store openings were down in April and cannabis prices have been down in June as well.”There’s a lot of optimism priced into these stocks. Aurora is trading at an EV-to-sales multiple of 5.5x. The MSOs in the U.S., who actually generate positive EBITDA, are trading at less than half that. So I think what happens is Q2 numbers come out, and I think they’re going to be a big disappointment, not just from a volume perspective but from a margin perspective,” Johnson said.How To Play It Johnson predicted large cash burns from Canadian cannabis producers but said US MSOs should perform relatively well in the quarter.”I think the stocks trade off significantly. And when I say the stocks, I’m talking about Aurora and Tilray,” he said. “I’d be short Aurora, I’d be short Tilray. On the flip side of that, you may look positively on some of the U.S. MSOs.”Johnson specifically mentioned Trulieve Cannabis Corp (OTC: TCNNF) and Curaleaf Holdings Inc (OTC: CURLF) as two U.S. MSOs that are performing relatively well when it comes to EBITDA.Watch to the full interview with Gordon Johnson in the clip below, or listen to the podcast here<>PreMarket Prep is a daily trading show hosted by prop trader Dennis Dick and former floor trader Joel Elconin. You can watch PreMarket Prep live every day from 8-9 a.m. ET here. The replay can be found on Benzinga’s YouTube channel, and the podcast is on iTunes, Google Play, Soundcloud, Stitcher and Tunein.Latest Ratings for TLRY DateFirmActionFromTo May 2020StifelMaintainsHold May 2020Cantor FitzgeraldMaintainsNeutral May 2020Cantor FitzgeraldMaintainsNeutral View More Analyst Ratings for TLRY View the Latest Analyst Ratings See more from Benzinga * Canopy Growth Analyst Sees Increasing Cannabis Market Share, Little Stock Upside * ‘Price Is Truth’: Analyzing Stock Chart Performance Using Technicals * Cannabis Short Sellers Down 1M In May(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.