Best Cannabis Stocks To Invest In This Fall 2021

The cannabis industry is expected to double in total value over the next 3 years, with legal products sales estimated to top $43 billion. That said, right now is prime time to invest and venture capitalists are taking note. Naturally, being an incipient market, there are numerous investment risks to take into consideration so it is important to have a good understanding of industry operations and patterns beforehand.

It can take some time to get educated in all the innerworkings of the complicated and everchanging cannabis industry, so until then, you can check out some of the current top stocks from our list and see if any are a right fit for you.

The cannabis industry is still relatively new, but growing at exponential rates. That’s why now is the perfect time to consider investing. If you’d like to learn more about the industry, make sure to subscribe to The Medical Cannabis Weekly Newsletter, your top-source for all things cannabis-related including more articles like this one and exclusive deals on various legal products.


1. Innovative Industrial Properties

Innovative Industrial Properties (NYSE:IIPR) is probably a name you’re already familiar with, as it’s well known, well performing, and somewhat unique in the industry. This company doesn’t deal directly with cannabis products nor is it really an ancillary company. Rather, it’s a real estate investment trust that specializes in the management of cannabis cultivation facilities, which it leases to growers across the US.

As of now, they only offer property contracts to growers that are licensed to cultivate for medical purposes. The medical market is stable, more widely accepted, and according to recent data collected by Global Market Insights, expected to surpass $15 billion in valuation over the next few years. IIP has a large portfolio in this sector that includes properties in Arizona, California, Colorado, Florida, and Illinois.

Now let’s take a quick look at the numbers. In 2020, the company reported a 162% increase in revenue, as well as a net income boost of 191 percent. In the first half of 2021, they company continued to see growth by 101% in the first quarter and 119% in the second.

In 2020 alone, the company reported that its revenue increased 162% and net income rose by 191% from the prior year. In the first half of 2021, the company’s revenue and net income surged by 101% and 119%, respectively, from the same period in 2020. The company raises its payout on a regular basis and recently announced a 28% year-over-year increase. Additionally, IIR is yielding 2.6% percent, compared to the average of 1.3% noted by S&P 500.

2. Jushi Holdings

When it comes to the type of cannabis stocks most investors think of when considering the marijuana industry, Jushi Holdings (OTC:JUSHF) is one of the first that comes to mind. Jushi is a multi-state cannabis operator has a large portfolio of dispensaries across the US in states such as California, Illinois, Virginia, Massachusetts, and Pennsylvania, its largest market where it current has 15 stores.

Jushi Holdings (OTC:JUSHF) is the kind of stock that most investors think of when looking at the marijuana industry. The multi-state cannabis operator has a fast-growing portfolio of dispensaries and retail locations that run from coast to coast.

Jushi Holdings has locations in Pennsylvania, Illinois, California, Virginia, and Massachusetts. The company’s most substantial presence is in Pennsylvania, where it has 15 stores. Additionally, they recently acquired an 8,000-square-foot medical cannabis production facility in Ohio, where they already sell a large percentage of their products.

Jushi Holdings reported a 220% year-over-year revenue increase in the most recent quarter, as well as 194% raise in gross profits from 12 months prior. Shares are up 80% since last year but they are still affordable enough for even novice investors to consider.

3. Cresco Labs

Cresco Labs (CRLBF), is another multistate operator with business in 10 different states. Their portfolio includes 44 ancillary retail businesses, 18 production facilities, and 32 dispensaries. National brands they represent include Cresco, Reserve, Remedi, and Mindy’s Edibles.

In April of this year, Cresco Labs announced the launch of a new line of low-dose cannabis-based edibles: Wonder Wellness. For now, this brand is only available in Illinois, but they will so be on store shelves in the all the states in which Cresco currently operates.

Cresco reported a 123% increase in sales during Q2, as well as an adjusted EBITDA of $45.5 million, which was 98% higher than the same time last year. In total, they reported a net profit of $2.7 billion, a 106% increase from 12 months ago – making it one of the safest and most reliable stocks in the industry.

4. GrowGeneration

GrowGeneration (GRWG) is the largest operator of hydroponic garden centers in the United States. Although they have been on a bit of a roller coaster ride this year as far as stock prices rising and falling, overall, they have been on a steady rise with shares doubling annually over the last 3 years.

In July 2021, GrowGeneration announced the acquisition of Michigan-based company HGS Hydro. In total, HGS operates seven stores and they are the third largest retailer of hydroponic products in the US.

In total, GrowGeneration operates 65 stores in 12 different states, and they are currently looking to expand into many of the newer markets such as Missouri, Illinois, Arizona, Pennsylvania, New York, and New Jersey. By 2023, they plan to operate over 100 stores across the country.  

Current numbers for GrowGeneration boast a year-over-year revenue increase of 190%, and a net income rise of 161% compared to last year. They also experienced 60% same-store sales growth and raised their full-year sales guidance. Despite some minor setbacks and occasional drop in prices, GrowGeneration is moving up again and stock prices are quite reasonable heading into fall.

5. ETFMG Alternative Harvest ETF

As far as industry stocks go, ETFMG Alternative Harvest ETF (MJ) is a well-known name in the world of cannabis investing and the first ETF to target the industry. Since launching in December 2015, MJ has accumulated an estimated $1.4 billion in total assets, and the company is expected to grow to $66.3 billion in annual revenue within the next 3 years. MJ has an impressive portfolio of Canadian holdings including Canopy Growth and Cronos Group.

According to Kiplinger’s Investment Outlook, “The Prime Alternative Harvest Index looks to embrace a broad strategy that not only invests in companies that grow or manufacture cannabis-related products, as well as CBD stocks; it also invests in those businesses that are likely to benefit from increased cannabis use worldwide. For example, a company such as Scotts Miracle-Gro (SMG) will benefit from the sale of lawn care, gardening and hydroponics equipment to cannabis enthusiasts. It represents 2.9% of MJ’s total portfolio, putting it outside the top 10 holdings.”

That being said, one slight setback to buying MJ stock is that their expense ratio is a bit high at 0.75%. But despite that, it’s an affordable, solid stock with tremendous growth potential.

Final Thoughts on Fall Cannabis Stocks

Right now is the perfect time to invest in cannabis. The market has solidified it’s place in our culture, so we know it’s here to stay, but the industry is still in its infancy so stock prices are affordable and seeing a lot of forward momentum.

Thank you for stopping by CBD Testers, your hub for all things cannabis-related. Remember to subscribe to The Medical Cannabis Weekly Newsletter for more articles like this one and exclusive deals on various legal cannabis products.

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Heading Into 2021 – Best Cannabis Stocks to Buy, and One Major Mistake to Avoid

The real winner on election day was cannabis. We now have legal, adult use cannabis in 15 states, and roughly 75% of the country has legalized medical marijuana – how does that play out when it comes to stocks?

In total, we have four new states (Arizona, New Jersey, South Dakota, and Montana) with recreational marijuana and another state (Mississippi) that passed legislation to launch a comprehensive medical program. Next year, Florida, New York, and Ohio are expected to pass adult-use legalization measures as well. When that happens, nearly half of Americans will live in a state where they can legally use marijuana.

With so much attention on legalization and future markets, cannabis stocks are expectedly hot. Even despite the pandemic, many cannabis stocks remained stable and have been skyrocketing in recent weeks. Check out the top few companies we’ve been keeping my eye on, and make sure to read to the end to learn about the biggest mistake to avoid when investing in today’s cannabis industry.

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Planet 13 (OTC:PLNH.F)

Referred to as the “Disneyland of Cannabis”, Planet 13 is the largest dispensary in the world. At 115,000 square feet, it’s larger than an average Walmart, comparable to a small shopping mall. And it’s much more than just a run-of-the-mill dispensary, it’s an experience. Inside there is a restaurant, a museum, regular entertainment, and a viewing area where customers can watch the manufacturing process of various different cannabis derivatives.

With a place like Planet 13, located right off the Las Vegas strip, there was considerable fear about what kind of effects the pandemic and lack of tourism would have on the business and holdings. In my opinion, what really set P13 apart from other touristy destinations is how quickly hey pivoted to a delivery business model that catered to the local community. At the beginning of the pandemic, around April, Planet 13 shares where selling for just around $1. Now, they’re hovering around $3.50.

“They’ve done an excellent job of adapting to very challenging times and Planet 13, they got hit really hard. They operate right off of the Las Vegas Strip with their superstore there, and of course, when the pandemic hit, tourism just evaporated. But the management team really moved quickly,” says Motley Fool contributor Keith Speights.

“They switched to a distribution model within the state of Nevada and serving the local market more than just tourists and really have managed to get through an extremely difficult time. I think their last quarterly report, their revenue was actually even a good bit higher than it was in the prior-year period. So, I think Planet 13 is really positioned well to come out of the pandemic quite strong.”

Cresco Labs (CNSX:CL) (OTC:CRLBF)

Ever since it was founded in 2013, Cresco Labs has held its ranking as one of the nation’s fasted growing cannabis companies. Cresco Labs is the third largest producer of cannabis products in the country, currently operating 19 dispensaries across nine states, and their products are sold in nearly 800 dispensaries throughout the United States. They manufacture a wide array of products including raw flower, vape cartridges, edibles, prerolls, and cannabinoid sprays and capsules, which they just launched last month

At the moment, this company is just about breaking even but still not profitable. However, shares are trading at a price-to-sales (P/S) ratio of 5.8. That seems high, all things considered, but it’s because investors are convinced they’ll turn a profit with Cresco Labs in the Very near future.

During the first half of the year, nearly all of the company’s dispensaries in all the states where they currently operate saw over 30% sequential sales growth. In California, which is the world’s largest and most competitive marijuana market, Cresco Labs showed quarter-to-quarter sales growth of 41 percent. It’s a strong possibility that shares will go up when the company reports their third quarter earnings, with will be released on November 18.

GrowGeneration (NASDAQ:GRWG)

GrowGeneration is another company that’s playing it smart. They stand to benefit significantly from legalization as states continue expanding their marijuana markets and giving people the right to grow cannabis in the own homes. As a way to save money in the long run, and have complete control over the growing environment, it’s becoming increasingly popular to set up a small home-grow.

GrowGeneration operates 31 hydroponic garden stores in 11 different states – which they plan on expanding to 50 stores in 15 states by the end of 2021. They provide nutrients, additives, lighting, fertilizers, and environmental control solutions to both individual growers and large-scale industry producers. It’s the largest chain selling such products, and their future doesn’t hinge entirely on the cannabis industry as they supply the needs of hydroponic growers of many other types of produce, such as tomatoes, lettuce, and peppers.

The company showed a revenue increase of 175% last year, bringing their profits to $76,4 million. By 2021, management expects to see roughly $300 million in sales and $36 million in operating income, excluding non-cash items (EBITDA). That’s nearly double the adjusted EBITDA of $20 million that GrowGeneration expects to rake in by the end of final quarter.

GrowGeneration ranked as the best-performing cannabis stocks during the first half of 2020, and third quarter earnings, which were reported September 2020, showed a revenue growth of 153% year-over-year. Shares are trading at a P/S ratio of eight.

Biggest Mistake Cannabis Investors are Making Right Now

The big mistake that some investors are making, though, is being to bullish, based on the assumption that the U.S. is set to soon legalize cannabis at the federal level. This is accurate, to an extent, and as many of us who are following investment trends noticed, cannabis stocks briefly soared when Joe Biden was named president on December 3rd.

But let’s not forget that Biden isn’t very enthusiastic about cannabis reform. As a matter of fact, any mention of cannabis reform was completely omitted from Biden’s initial draft transition plan on racial equality, despite campaign pledges to make that a priority.

To make matters worse, republicans still have a stronghold over the U.S. Senate. With senate majority leader Mitch McConnell (R-Ky.), we can expect any bills regarding cannabis legislation to be swiftly blocked. Despite backing hemp revisions in the 2018 Farm Bill, Sen. McConnell has stood in the way of marijuana reform for years.

As of now, the GOP is slated to hold 50 Senate seats next year, and it looks like two remaining races Georgia is the deciding factor on which party has the majority. So, if (or when) Republicans win those southern elections, it means Sen. McConnell will remain senate leader and go on preventing progressive cannabis bills from even reaching the Senate floor for a vote.

So yes, full federal cannabis legalization is on the horizon, but don’t start basing all your financial decisions on that just yet.

Final Thoughts

Cannabis stocks are hot, but still not so expensive that the average investor is alienated from the market. If you have the means, it’s great time to put your funds into the industry and get some shares of a reliable company that shows promising growth trends. Above are a few that have been getting a lot of attention and are positioned to perform well over the coming years.


RESOURCES:

Synthetic Cannabinoids (Are they synthetic cannabinoids safe?)
The Endocannabinoid System Explained (Why Cannabis Is Good for Our Bodies)
Everything You Need To Know About CBD Isolate (a deep look into hemp extracts)

Cannabinoids 101 – Spotlight on CBN (Cannabinol)
Your Complete Guide to EU GMP-Certified CBD Isolate and Distillate – Spotlight on the regulated EU market

Everything You Need To Know About CBG Isolate
Newest Cannabinoid Powerhouse – CBC – What Can It Do for You?
What is DELTA 8 THC (FAQ: Great resource to learn about DELTA 8THC)
The CBD Flowers Weekly newsletter (your top resource for all things smokable hemp flowers)
The Medical Cannabis Weekly newsletter (International medical cannabis business report)
The Legal Landscape Of CBD Hemp Flower In Europe

The Delta 8 Weekly Newsletter (All you need to know about Delta 8 THC)
Regulators Go After Smokable Hemp Flower – What Does The Future Hold?
The Complex Issue of Marijuana and Hemp Business and Legalization On Tribal Land
Government Assistance Options for U.S. Hemp Farmers Affected By COVID-19

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Your Complete Guide to Investing in Cannabis Stocks in 2020

Think back to 2017, 2018, and even the first quarter of 2019 – cannabis stocks were hot, and the talk of Wall Street investors globally.

Those who had the resources and foresight to invest in cannabis a few years ago were sitting pretty good by the beginning of last year. More than a dozen cannabis stocks rose 70% or more in the first quarter of 2019, leaving investors up by quadruple digits. But the wins were short-lived.

For the last 14 months or so, cannabis stocks have been plummeting and recent events have done nothing but throw another wrench in the gears for already pessimistic investors.

There is a silver lining however; the fact that cannabis is always an in-demand product, so certain stocks still have a lot of potential.

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What are the experts saying?

Matthew Carr, financial publisher and chief trends strategist of The Oxford Club, a network of investors and entrepreneurs, believes that cannabis stocks will certainly see better days, and those days are likely just around the corner. He says that now is the time to start making investments in the cannabis industry.

“The industry got killed [last year] by the vaping crisis,” stated Carr. “Coming from the illicit market and vitamin E additive, that contributed to the longest bear market the industry experienced. Then we had CEO misconduct and firings. After we made it through that, I thought it was going to be a good year for cannabis in 2020.”

“After COVID hit, I thought maybe it would be the final straw that hit the camel’s back,” he continued. “But the industry has proven to be remarkably resilient. Cannabis deserves a place in that vice stock category—alcohol, tobacco, firearms, casinos—all that people consume more of during an economic recession. I believe the sector is attractive now and after the pandemic is over.”

Stifel analyst Andrew Carter echoed these sentiments, referencing the Canadian market. “The market made strides throughout late April into May with store (reopenings), new store additions, private operators investing in omnichannel capabilities, and Provinces improving upon their own e-commerce capabilities… we believe the strength is likely to continue.”

Things to keep in mind

First and foremost, it’s extremely important to remember that pot stocks aren’t going to get you rich overnight, it’s not that kind of investment. In the beginning, yes, stocks were surging to unimagined heights. But that bubble has burst and prices have leveled out. From this point forward, you can expect to see to slow yet consistent growth (over years, not weeks or months) in stocks that have what it takes to make it over the current hump.

Cannabis Legislation Moves Forward Across the U.S. – Revenues Continue to Soar – What Else Does the Future Hold?

The second thing to bear in mind is that numbers and profitability matter over marketing hype and empty promises. That sounds obvious, but a good ad campaign from a familiar company might have some novice investors overlooking major monetary red flags.

For example, Aurora Cannabis is a well-known Canadian grower and top-ranked stock among millennial investors. Unfortunately, the company has been losing money like it’s the thing to do, and their share price is dropping as a result. Aurora stocks have lost 84% of their value over the trailing year, yet despite this, new-to-the-sector investors are quick to throw their money at the troubled stock.

Comparatively, investors with money in the lesser-known stock, Trulieve Cannabis, have been banking for years. Although Trulieve has operations in multiple states, they’ve largely focused their efforts on the Florida market, with 48 of their 50 medical dispensaries operating within the state. Their targeted marketing strategy has helped them be very effective with branding while keeping company expenses down.

The third must-know, is that cannabis is a fluctuating stock in a relatively new and turbulent market. Just like most other stocks, many societal factors will impact the cost and profitability of your investment. Tourism, unemployment rates, job market, and numerous other issues can impact the success of a cannabis business.

Stocks to follow

Trulieve Cannabis (OTC:TCNN.F) – As mentioned above, this stock has been a consistent money maker. During its most recent quarter, Trulieve cleared $96.1 million in total sales, with $28.9 million in cost of goods sold and $31.1 million in operating expenses, leaving the company with an operating income of more than $36 million. Trulieve’s shares are up 12% percent over the trailing year.

Marlboro Investment Lights-Up Fortunes of Canada’s Cronos Group

Cronos Group (CRON:NASDAQ) – With financial backing from major investors like Altria, maker of Marlboro cigarettes, Cronos group was able to funnel money back into their core operations, which solidified their impact and reputation in the global cannabis market. In its first fiscal quarter of 2020, Cronos saw 55.5% year over year growth in net revenue to 8.4 million Canadian dollars. Despite high operating costs, it’s still a strong and safe cannabis industry investment.

OrganiGram (OGI:NASDAQ) – Although this company has had some ups and downs, especially now that we continue to navigate the economic effects of COVID-19, this Canadian grower and producer ended the last quarter with $41.2 in cash and short-term investments. This was a roughly $8 million increase since their previous quarter. Over the long term, this company has exhibited good management practices and the ability to properly oversee funds.

Final Thoughts

To sum it up, if you have some extra cash on hand, it might be a wise move to put your money in a safe and reliable cannabis stock. Prices are currently down and you can test the waters without putting up a very large initial investment.

Thanks for stopping by CBD TESTERS, your hub for all things relating to business and medical cannabis. Stop by regularly and make sure to subscribe to the Medical Cannabis Weekly Newsletter to keep up-to-date on all the most interesting industry topics.

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