The US might not be as progressive as Canada when it comes to cannabis, but at least we’re moving forward instead of standing still: ten years ago, recreational weed was a pipe dream (literally); today, eight states allow it….and that’s just within the last five years.
With this progression, pot is a worthy investment; it’s a billion-dollar industry that’s on the upswing. Those who’ve invested in it – by opening stores or learning to grow – have found that hash rhymes with cash for a reason.
But what about stocks? What are the cannabis stocks worthy of investment? And should you even invest in the first place?
The Reasons to Wait for Cannabis Stocks
The stock market is a gamble; no one knows for sure what stocks will skyrocket and which will plummet (or which will skyrocket as soon as you take out all of your money). Cannabis stocks are even riskier than more traditional investments and that’s because of their uniqueness.
For instance, the marijuana industry doesn’t have access to financial institutions
– banks answer to Uncle Sam and as long as cannabis stays illegal on the federal level, pot people will be forced to deal in cash. Not only is this a security concern, but it has the potential to prohibit growth as well.
Another concern surrounds the stocks themselves – most marijuana stocks aren’t turning a profit. There’s many reasons for this: the banking limitations mentioned above, the limitations on tax deductions, and lack of experience. And many of these stocks are penny stocks (or stocks that have share prices of five dollars or less) that trade on over-the-counter exchanges. These exchanges aren’t necessarily bad, but they have nowhere near the street cred as the New York Stock Exchange or Nasdaq.
The current administration is a concern too; Trump is maybe pro-medicinal pot (he tends to change his mind on issues as often as he changes his mind on cabinet members), but Jeff Sessions has remained stubbornly anti-all. This has left some in the cannabis industry fearful of what the future holds, but not unhopeful entirely – at least this future is only four years.
Still, none of the above means cannabis is off-limits to investors altogether. Stocks are a risk and marijuana ones may be a bit riskier. But they offer the chance for higher returns as well.
GW Pharmaceuticals Stocks
For a long time, GW Pharmaceuticals has been heralded as the only cannabis company to invest in, the only horse to back. GW is a British biotech that’s listed on Nasdaq. It’s known for the product Sativex, a medicine that treats multiple sclerosis and the first natural cannabis plant derivative to ever secure market approval.
Whether or not it’s still a good investment depends on who you ask, but that’s par for the course when it comes to stock exchanges. Its revenue is falling, but people anticipate a dramatic rebound on the horizon. Yet it’s not the only horse available, either.
According to Investopedia, some of the other stocks to consider adding to your portfolio include:
AbbVie Inc.: AbbVie is a pharmaceutical company that has a cannabis drug already on the market (with FDA approval). The name of the drug is
Marinol is used to treat nausea in chemotherapy patients and stimulate appetite in diseases known for dangerous weight loss (such as AIDS).
Marinol isn’t the only drug produced by the company – it offers several others. But the risk comes from its lack of international reach: it’s concentrated in US markets only. This means if the domestic markets fall, so will this stock’s value.
Scotts Miracle-Gro: Not a cannabis company, per say, Scotts manufactures products for plant care, which ties it to cannabis. It offers regular lawn and garden products, but it’s developing products that specifically target marijuana growers, such as pesticides engineered for marijuana plants. They’ve also been busy acquiring hydroponic companies.
However, Scott’s revenue has declined over the past four years. Some investors see this as a good thing – they’re waiting for a breakout – while others place this stock in the wait and see category.
Corbus Pharmaceuticals: Corbus has several marijuana-based drugs in clinical trials, setting up investors for a windfall or a fallout depending on the result of said trials. For what it’s worth, Resunab, a drug designed for multiple sclerosis, is showing promise. They’re also testing it for Cystic Fibrosis.
Corbus has hardly any revenue and its drugs will certainly make or break them. But if they’re linked to positive outcomes, those who gambled on the investment will likely see positive returns.
Marijuanastocks.com offers a few other options they recommend considering. These include:
Aurora Cannabis: Aurora Cannabis focuses on growing, cultivating, and selling medical marijuana in Canada. Their mission is creating the safest and cleanest medical marijuana around. They offer registered patients affordable prices, free shipping, and say in future products.
Cara Therapeutics: Cara is presently developing a cannabis-based medicine that targets the body’s peripheral nervous system. This may be useful in people with chronic kidney disease and acute postoperative pain. They’re presently involved in clinical trials.
INSYS Therapeutics: INSYS has two cannabis-based drugs that have obtained FDA approval as well as seven others on deck. One of these drugs is Syndros, a medicine that helps patients suffering from AIDS or anorexia, by stimulating hunger. It’s used to help patients undergoing chemo as well. They also offer another drug aimed to help control childhood epilepsy.
Cannabis has a bright future; even people who dislike it have to admit it’s the high school senior destined for the Ivy league. Its potential has many people feeling hopeful, perhaps giddy. This isn’t a bad thing, but it can lead to investors jumping into stocks without weighing the risks.
Weed is a good investment, but that doesn’t mean that every stock or company is good too
Anyone hoping to put their money where their marijuana is must do so carefully. If you want to invest in a cannabis company, make sure you invest in the right company. Don’t be the person who invested in Friendster over Facebook.