Last week, a blockbuster story for marijuana stocks — one of the biggest in years — slipped by a lot of investors. It was in the news, but most investors don’t know the industry well enough or the players involved to grasp its huge significance. To them, it was just another headline.
Not to me. I’ve been waiting years to write this story, and now the final chapter is taking shape.
I’m extremely bullish on the once-in-a-lifetime opportunity to build wealth in marijuana stocks. There was a time when other investors laughed at me because of it. Not anymore.
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Basically, the biggest marijuana company in the world and some of the most connected people in the world all but told us that U.S. marijuana legalization is coming… and perhaps sooner than expected.
Cannabis giant Canopy Growth (NYSE:CGC), which is based in Canada, confirmed last week that it plans to enter the U.S. market. The $16.5 billion company made an offer to buy U.S.-based Acreage Holdings (OTCMKTS:ACRGF).
At first glance, that doesn’t sound all that important. But remember: Marijuana is legal in Canada. It is not in the United States, at least on the federal level.
In fact, any company that touches the marijuana plant in the United States cannot list on a major stock exchange — the New York Stock Exchange (NYSE), NASDAQ, even the Toronto Stock Exchange (TSX).
Well, guess what? Canopy already trades on the NYSE and TSX. If it were to enter the U.S. marijuana market right now, it would be forced to delist from both and move down to a lesser known, less liquid exchange.
There is no way the company would let that happen.
So what prompted Canopy to prepare to enter the U.S. now? Why not next month? Next year? Why not wait until after marijuana legalization?
Two reasons. One, Canopy wants to be ready to capitalize on what will instantly become the largest marijuana market in the world the moment it becomes legal.
And two, Canopy all but knows — or is at least extremely confident — that legalization is right around the corner.
Management didn’t say that outright. I wouldn’t expect them to. But I believe it to be true because of three very important people on the board of Acreage Holdings:
Among those three gentlemen, there is undoubtedly insight into marijuana’s future that you and I are not yet privy to.
But if we know the industry and the players involved, we can connect the dots. These two companies have access to and insight from three of the most politically connected men in the world. They decided it was time to make a deal.
If Canopy believed U.S. legalization was still years away, there would be absolutely no reason to buy the rights to Acreage yet.
Last week’s announcement is like knowing the score of a game before it starts. Marijuana stocks are already on the move, but you still have time to position yourself to make a lot of money as legalization sweeps the globe and the industry grows many times over.
Instead of buying Acreage outright today, Canopy wisely bought the “rights†to purchase the company when marijuana becomes fully legal in the United States. That last part is the key. And Canopy wouldn’t do that if legalization were still years away.
When marijuana does become legal, Canopy will pay $3.4 billion, a 42% premium over Acreage’s average value the last month. The deal is mostly stock, which means Canopy still has more than enough cash to make similar deals.
Canopy Growth is not just any marijuana company. It is the biggest cannabis company in the world, so deals like this speak volumes. Canopy’s $16.5 billion market cap is nearly 80% above its closest competitor, Aurora Cannabis (NYSE:ACB), which his valued at $9.2 billion.
Last June, Canopy was the first of the marijuana stocks I’ve recommended to my Investment Opportunities readers. We’re up 58% since then, capitalizing on the stock’s nearly 80% jump in 2019. It is above my recommended buy limit, but it is a stock every cannabis investor should try to own at the right price.
In the wake of the big news, we will be adding fresh stocks in position to benefit from the coming U.S. marijuana legalization. In the meantime, there are other great buys with huge potential, from growers to suppliers to real estate companies to IPOs and more.
Some of the absolute best opportunities are in smaller companies that are about to explode — possibly into the next Canopy Growth or Aurora Cannabis. In fact, one tiny company I recommend even has interesting connections to Canopy Growth.
I am more excited than ever about the opportunity to make life-changing gains as the marijuana industry grows exponentially in the coming years. Now is the time to act.
That tiny company I mentioned is a unique type of investment among red-hot marijuana stocks.
As the cannabis industry grows exponentially in the coming years, it could realistically multiply your money several times over… if you take part soon — I’d say no later than April 25.
The company is part of a phenomenon that has only occurred a small handful of times in the past few decades — in other industries. But on many occasions, it’s resulted in an explosion of wealth so incredible, the numbers almost seem made up.
The first time we saw it was in 1983, when it returned early investors as much as 45,300% gains!
Incredibly, there is that opportunity once again, right now… in the booming marijuana market.
This is so important that I put together a presentation with all of the details on this rare opportunity and why you need to act now. Click here to learn all about it.
Matthew McCall is the founder and president of Penn Financial Group, an investment advisory firm, as well as the editor of Investment Opportunities and Early Stage Investor. He has dedicated his career to getting investors into the world’s biggest, most revolutionary trends BEFORE anyone else. The power of being “first†gave Matt’s readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA), +1,044% in Tesla (TSLA), +611% in Liquefied Natural Gas Limited (LNGLY), +324% in Bitcoin Services (BTSC), just to name a few. If you’re interested in making triple-digit gains from the world’s biggest investment trends BEFORE anyone else, click here to learn more about Matt McCall and his investments strategy today.
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