Marijuana stocks may not have had a stellar year
in 2018. But, this year could easily bring better news
as things continue to expand and more new marijuana markets open
Canada became the first country to legalize
recreational weed last October. This development has, undoubtedly,
cemented the way for billions of dollars in legitimate annual sales
and has helped the pot market to come out from the shadows and into
the limelight as a reliable business model.
A number of developments happened in the United
States as well. President Trump signed the Farm bill into law last
November, legalizing hemp and cannabis-based products throughout
To top it off, the U.S. Food and Drug
Administration approved the first cannabis-derived drug,
with quite a number of U.S. states giving green signal to
cannabis in some capacity last year. Nearly two-thirds of all
states in the U.S. have legalized medical marijuana and 10 of them,
in fact, allowed adult consumption.
Companies in this up-and-coming industry, thus,
have taken aggressive steps to raise cash, go public and list their
shares on the U.S. exchanges to access capital. Hence, looking at
some of the stocks from this fast-growing industry doesnât seem
like a bad proposition.
Marijuana Sales to Skyrocket
According to Arcview Market Research and BDS
Analytics, global consumer marijuana outlays are estimated to climb
38% to $16.9 billion this year, up from a projected $12.2
billion last year, $9.5 billion in 2017, and $6.9 billion in 2016.
Additionally, compounded global annual sales growth of cannabis
from 2017 to 2022 is expected at $31.3 billion.
While legalization of marijuana in several U.S.
states and in Canada will surely help cannabis growth to hit such a
promising number by 2022, a number of dispensaries have been given
the permit to sell legalized cannabis. At the same time, mergers
and acquisitions between large beverage, tobacco, pharma and
cannabis companies should certainly help the weed market grow.
After all, deal making will diversify their product portfolio and
Investment bank Cowen & Co said that the
legal weed market is expected to reach a value of as much as $75
billion by 2030. This indicates that there are plenty of
opportunities for investors to make money from both direct and
Fast-Growing Marijuana Stocks to Consider
As excellent prospects are expected to make
marijuana stocks winners this year, take a look at these selected
few poised to move north this year. All these stocks possess at
least a Zacks Rank #3 (Hold) right now. You can
see the complete list of todayâs Zacks #1 Rank (Strong
Buy) stocks here.
GW Pharmaceuticals GWPH focuses
on discovering, developing, and commercializing cannabinoid
prescription medicines using botanical extracts derived from the
cannabis plant. The cannabinoid drug maker is expected to see an
uptick in sales this year, especially after its lead drug,
Epidiolex, became the first cannabis-derived drug to gain approval
from the FDA.
Earnings for GW Pharmaceuticals, a Zacks Rank #2
(Buy) stock, is projected to gain 5.13% in the next quarter. The
company has outperformed the Medical - Products industry
so far this year (+56.5% vs +9.4%).
Innovative Industrial Properties
IIPR, also a #2 (Buy) on the Zacks Rank, focuses on the
acquisition, ownership and management of specialized industrial
properties leased to experienced, state-licensed operators for
their regulated medical-use cannabis facilities.
With more states in the United States giving
cannabis the green light, Innovative Industrial Properties has
incentive to acquire additional properties. The stockâs
expected earnings growth for the current year is 64.2%, and the
company has outperformed the REIT and Equity Trust -
Other industry on a year-to-date basis (+44.2% vs +13.6%).
KushCo Holdings KSHB operates a
creative design agency for cannabis and non-cannabis clients that
provide brand strategy, design and marketing, Web application
development, and e-commerce solutions.
KushCo, by the way, had acquiredSummit
Innovations known for manufacturing hydrocarbon gases. These gases
are necessary for converting cannabis plants into oils, and we all
know that oil generates more profits than traditional dried
Next yearâs earnings could grow over 100%, and
the stock, a #3 (Hold) on the Zacks Rank, has gained over 14% since
Canopy Growth CGC engages in
growing, possessing, and selling medical cannabis in Canada. In
fact, in terms of aggregate sales, Canopy Growth may find itself at
the top spot. The companyâs annual production comes in at more
than 500,000 kilograms and is positioned to increase on branding
While shares of Zacks Rank #3 (Hold) CGC have
only gained around 8.5% this year, it has a huge cash stockpile
that far surpasses its peers thanks to Constellation Brandsâ STZ
hefty $4 billion investment made last year.
Zacks 2019 Marijuana Investorsâ
Summit: In addition to the companies you learned about
above, we invite you to learn more about investing in pot stocks.
On Tuesday, February 26, our team of experts will reveal what we
believe is the single best way to make money from legal marijuana.
Register Now for Free >>
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free
Constellation Brands Inc
(STZ) : Free Stock Analysis Report
GW Pharmaceuticals PLC
(GWPH) : Free Stock Analysis Report
Properties, Inc. (IIPR) : Free Stock Analysis Report
KUSHCO HOLDINGS, INC.
(KSHB) : Free Stock Analysis Report
Canopy Growth Corporation
(CGC) : Free Stock Analysis Report
To read this article on
Zacks.com click here.
Zacks Investment Research