In recent years, cannabis has become more popular internationally, and it’s been legalized for recreational, medical, and other purposes in more and more countries, states, and jurisdictions.
Cannabis stocks are a fantastic investment opportunity, given that the marijuana sector was practically non-existent before. Sure, individuals have been growing and selling marijuana for a long time, but they’ve always done so illegally.
With favorable social opinion and legislative winds, legalization is gaining traction, converting the plant into a taxable cash stream.
Statistical Market Analysis
According to ArcView Market Analysis and BDS Research, worldwide spending on legalized marijuana would reach $57 billion in a decade. Legal cannabis earnings in the United States are expected to reach $23.4 billion by 2022, supported by the licensing of medical and recreational cannabis and rising demand for both.
If you are interested in investing in cannabis stock, we are here to guide you about the hottest cannabis stock available. First, however, it is important to examine the status of the largest weed stocks in the present context, as understanding where they are can help determine where they are headed.
Let’s discuss some of the most well-known marijuana stocks.
Curaleaf (CURLF): The best cannabis stock
“96 dispensaries, 23 production facilities, and more than 30 processing sites” make up this company’s 23-state footprint. Curaleaf also earned $626.6 million in 2020, increasing about 184 percent from the previous year. Even better, the business continues to grow, with top-line revenues of $260.3 million at the start of 2021.
Green Thumb Industries (GTBIF):
Green Thumb Enterprises (OTC: GTBIF) runs 13 manufacturing facilities and owns retail cannabis outlets in 12 states throughout the United States. Green Thumb has 96 commercial cannabis licenses but only opened a little more than half of that number.
This company benefits from huge development in its home state, with the legal recreational marijuana market in Illinois set to start in the first half of 2020. As a result, the company has enormous growth potential and the possibility to develop into other states such as New York and New Jersey.
Trulieve Cannabis (TCNNF):
Trulieve Cannabis is another cannabis stock that could make you wish you could go back in time. TCNNF stock was trading around the $6 mark during the company’s March lows. Speculators have profited handsomely from this market, as indicated by current pricing. This stock is now trading at approximately $37.50.
- Trulieve Cannabis emphasizes that its low-THC/CBD medicines are intended for patients who do not require euphoria.
- With over 550 SKUs, the company caters to a wide range of clients and introduces new items on a regular basis.
- It reported $193.8 million in revenue in its most recent earnings report.
Cresco Labs (CRLBF):
Cresco Labs, another big MSO in the cannabis stock market, has a significant presence in the United States. It includes 18 manufacturing facilities, 44 retail licenses, and 32 licensed dispensaries in ten states.
Cresco has several premium national brands that cater to distinct consumer needs. The brand has everything for everyone, from edibles to vaping items and more. It also gives Cresco an advantage when it comes to spreading the word about organic products. Basically, infused gummies are far easier to persuade someone about the benefits of cannabis than a bong.
This vast product stream also has a good impact on CRLBF stock, which is reassuring. CRLBF has risen 24 percent YTD despite some severe rumblings this year. Moreover, the stock has risen about 149% in the last year, indicating rising demand for high-end marijuana goods.
Ayr Wellness (AYRWF):
Ayr Wellness, one of the most recent cannabis stock movers and shakers, had its stock rise 3.5 % on May 26. AYRWF stock has risen 10.5 % in the last five sessions using this date as a benchmark. The stock is currently trading at a bit more than $30.
Innovative Industrial Properties: (Ancillary provider)
Since marijuana remains illegal on the federal level, cannabis enterprises in the United States have difficulty obtaining funding from banks or financial institutions. Through its acquisitions and leasing of properties held by medical cannabis producers in the United States, Innovative Industrial Properties (NYSE: IIPR) helps developing marijuana businesses overcome liquidity shortages. The land sale to IIP gives much-needed cash to the cannabis company, while the lease agreements provide IIP with a consistent revenue stream.
IIP’s business was somewhat interrupted by the COVID-19 outbreak, with three tenants receiving temporary rent deferrals. Despite the epidemic, the ancillary firm has continued to develop rapidly and is extremely profitable. IIP returns at least 90% of its taxable revenue to shareholders because it is structured as a real estate investment trust (REIT).
GrowGeneration: (Ancillary provider)
GrowGeneration has a presence in ten states, including Colorado, California, Michigan, and Nevada, and maintains 28 hydroponic and horticultural businesses and an online retailer. According to Lampert, the company aims to create more facilities in the Northeast side, focusing on the marijuana, hemp, and organic grower markets.
GrowGeneration expects to open 50 stores in 15 states by the end of 2021, a year in which the business has set a revenue target of $260 million on the high side. Such growth would be a 232 percent increase over the firm’s sales of $79.7 million in 2019.
Sales are rising 180 percent year over year among GrowGeneration’s multi-state operators (MSOs), who account for 20% of the company’s revenue.
Scotts Miracle-Gro: (Ancillary provider)
Another firm benefiting from the same trends that have improved GrowGeneration’s sales is Scotts Miracle-Gro(NYSE: SMG). Hawthorne Gardening, the company’s hydroponic gardening division, is a leading supplier of hydroponic gardening goods to the cannabis market.
Even though Hawthorne is the company’s key growth driver, consumer lawn and garden goods still account for well over half of Scotts’ entire revenue. The COVID-19 epidemic has also benefited this industry.
Other Valuable Stocks:
However, there is no shortage of options when it comes to finding the best marijuana stocks, as the market is flooded with many other companies holding great potential for providing investors with valuable investment options.
Following are some other top marijuana stocks to buy:
- Ascend Wellness Holdings (AWWH)
- TerrAscend Corp. (TRSSF)
- Cara Therapeutics (CARA)
- Cronos Group (CRON)
- Amyris Inc. (AMRS)
- Jazz Pharmaceuticals (NASDAQ: JAZZ)
- Altria Group Inc (MO)
- Constellation Brands, Inc. Class A (STZ)
Should I Invest in Marijuana Stocks, Anyway?
You don’t have to invest in a popular new sector with a lot of press and prospective growth just because it’s trendy. If you invest in wide-ranging index funds, you will be protected regardless of whether areas of the stock market perform well. Marijuana equities are probably best avoided by conservative investors who desire reduced risk.
Marijuana stocks, on the other hand, are likely to appeal to aggressive investors with high-risk tolerances. The cannabis market is still in its infancy, but its potential is huge, especially as more states in the United States legalize the drug. Thus, investing in marijuana stocks is a high-reward business indeed but involves its own set of risks.