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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Next Stop for Cannabis Industry Investors: Malawi

The countries in Africa are falling one by one. First Lesotho, then Zimbabwe, then Zambia, and now Malawi. Quickly changing their cannabis regulation to promote global medical marijuana export markets. How will Malawi’s introduction onto the playing field fair?

Malawi is a landlocked country in southern Africa, bordered by Mozambique, Tanzania, and Zambia. Ten different ethnic groups are associated with Malawi, which has a population of approximately 21 million people. Most of the country works in agriculture with the majority being subsistence farmers on smaller farms, while growing tea and tobacco is done on large estates. This system has largely favored the bigger estates which has led to a great wealth inequality, with most of the population living in extreme poverty resulting in high infant mortality rates, chronic and widespread malnutrition, and general sickness. The overall life expectancy is in the low 60’s.

Much like Zimbabwe which also relied heavily on tobacco exports, Malawi was in the market for a new industry, making its induction into the African green rush right on point. As said by Agriculture Minister, Kondwani Nankhumwa, “Legalisation of this crop will contribute to economic growth as it will contribute in the diversification of the economy and boost the country’s exports, especially at this time when tobacco exports are dwindling.”

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Cannabis laws in Malawi for citizens

According to the Dangerous Drugs Act, “The Minister may by regulation: prohibit, control or restrict the production or possession” of illicit substances. Since trafficking is the bigger deal, and where law enforcement spends most of its energy, use crimes are generally overlooked. Since 1961, when Malawi signed the UN Single Convention on Narcotic Drugs, it has been illegal to sell or supply cannabis in the country. This has not stopped cannabis smuggling from being pretty routine, something Malawi has received criticism for.

Citizens are not permitted to grow any form of cannabis, hemp or marijuana, but it happens often anyway, with illegal cannabis grow operations being the primary activity when it comes to illicit drug rule-breaking in Malawi. Anyone caught illegally doing grow and supply crimes can now face up to 25 years in prison and an approximately $70k fine.

CBD, medical, and religious

CBD, or cannabidiol, one of the non-psychoactive components of the cannabis plant associated with many medical benefits, is exempt from the laws governing the rest of the plant, but there seems to be ambiguity in the terminology, and it is not actually legal there, only cultivated and produced for export.

In terms of medical use, the new bill did attend to a medical program for the residents of the country, although how well it will be carried out remains to be seen. Some of the bullet points include patients requiring a Registry Identification Card, that distributing cannabis from doctors to patients can only be done with the attendance of inspectors and police officers, and not producing adequate documentation or making false statements in regards to entrance and use of the cannabis program can incur financial penalties and up to five years in prison.

Malawi is home to a small Rastafarian community that has itself been pushing for religious legalization. This bill, along with not granting any form of recreational or personal use laws, also didn’t recognize any religious use rights.

Legalized Religiously – How Rastafari Tradition Is Helping Ease Cannabis Regulation in the Caribbean

Cannabis laws for business use

Earlier this year, cannabis was legalized for medical and industrial use in Malawi. The bill establishes certain bullet points for the regulation of the industrial cannabis market including the following:

  • The Cannabis Regulatory Authority (CRA) is the new body that will be responsible for issuing licensing for cultivation, processing, distribution, and export of products for the industrial hemp and medicinal cannabis programs.
  • The CRA will also issue research permits.
  • License holders must comply with CRA security requirements regarding growing, sale, exportation, processing, distribution, and storage.
  • Cultivation must be done under strict practices including children not being involved, the natural environment being preserved, and compliance with a very high soil standard including fertilizers and pesticides that can be used.
  • Inspectors will be appointed by the CRA to ensure compliance with regulation.
  • Growing and supply operations that are not government approved are subject to large financial penalties and up to 25 years in prison.

Hemp cultivation is allowed with up to 1.0% THC. This means that it’s over the 0.2% allowed in cannabis applications by current EU standards, but follows in line with other countries that have more recently set their THC limit higher.

How’s business going?

Since Malawi only made its regulatory updates recently, it’s expected that not all the pieces are in place yet. It can often take a country years to work out kinks in their licensing and regulatory framework, so the specifics of how much licenses will cost, and if there are other provisions that must be met by potential licencees, is still unknown.

In terms of interest by foreign countries in using Malawi for their own cannabis production projects, Director of Investment Promotion Joshua Nthankomwa stated back in 2018 before the laws had passed “We have registered huge interests from companies in Canada, Israel and many other places. We look forward to many more investors coming, not only in this sector, but many other sectors that Government has created environment for one to grow their business.”

African Foothold for U.K. Entrepreneurs in Tandem with Aphria

The first company to get a research license to grow cannabis in Malawi was Invegrow, which started conducting trials on low-THC hemp back in 2015 to investigate hemp as a practical crop and determine viable seed strains. Its trials were used to help the government draft the legislation for commercial legalization. With its foothold already in the country, Invegrow is looking to start production of broad-spectrum hemp extracts and essential oils for export.

Other international companies had expressed interest in Malawi before the legalization, among them, Green Quest Pharmaceuticals, which requires 50,000 hectares of land to grow industrial hemp for manufacturing products like clothing and medicine. Green Quest Pharmaceuticals investor, South African/Canadian Graham Macintosh was among a group of lobbyists that encouraged politicians to create regulation that would allow them this ability.

The investment in Africa

Africa is becoming a hot spot for foreign investment in cannabis since Lesotho first opened up its cannabis regulation to allow for legal cultivation of medicinal cannabis in 2017. Zimbabwe and Zambia followed suit in the next years, with each bringing increased chance for investment, and more companies interested in getting a foothold in their fertile, rich-soiled land. These countries come complete with cheap farm labor in the form of the locals who are technically being priced out of their own markets.

Whether Malawi will follow suit will only be known as more specifics come out about prices and rules for licenses. As per statements made earlier by government officials, looking for foreign investment is key, and this possibly could mean steep licensing prices. On the other hand, if prices are kept low, it could mean more opportunity for not only locals to take advantage of their own land and profit directly from the new market, but also for lower capital investors from abroad who don’t have the bigger capital of their larger competitors, the chance to buy in as well.

The African Cannabis Market is Poised to Reach $7.1 Billion Within Four Years

Conclusion

Malawi is likely not the last African country to jump into the new legal medical cannabis market. In fact, several others in the general southern region (and elsewhere) are already looking into updating legislation to take part. For anyone interested in Malawi, or Africa in general, as a place for their own possible investment, a close watch should be kept on news coming out about pricing and particular laws and requirements for whatever kind of establishment is in mind. Chances are, within the next several months we’ll start hearing about all the new deals going down in Malawi’s new legal cannabis market.

Thanks for stopping by CBDtesters.co, your place to go for all things legal-cannabis related. Come back frequently and subscribe to the CBD Testers Weekly Newsletter to stay up-to-date.

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An Investor’s Guide to Cannabis and Hemp

Despite numerous challenges that constantly throw this industry on its head, there are many opportunities to make worthwhile investments in cannabis and hemp – and as it becomes increasingly mainstream, these opportunities will grow in abundance and fiscal potential.

Science and pharmaceuticals, engineering of new equipment, marketing, distribution, farming and more, the potential for a rewarding investment (or investments) in the cannabis and hemp sector is infinite. Investors need to remember that market research is the key to making informed financial decisions.

Research by the Kauffman Foundation led by Robert Wiltbank, Ph.D., and Warren Boeker, Ph.D. prove just that. Studies show that investors who spend over twenty hours performing due diligence on a prospective company accomplish 5.9 times more profit on their investments; Investors who spend under twenty-hours average around 1.1 times on investment returns; and investors who spent over forty hours researching achieved a whopping 7.1 times more.

Of course, in a field as wide open as cannabis/hemp, it could easily take twice that long just figuring out where to look. Trust us, we know. That’s why we put together this investor guide – we’re doing the heavy lifting so you can go out and make some real money in this confusing industry.

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First, Some Advice From Experienced Investors

According to Aaron Herzberg, a partner at CalCann Holdings, a medical cannabis real estate company based out of California, “Investments in cannabis are not for the average investor. Cannabis remains federally illegal, and there are significant challenges with federal taxation and lack of access to banking.”

“Regulations are established on a state-by-state level and are constantly in flux.” Herzberg also states that “people think money grows on marijuana plants, but the reality is that the business is complex, capital intensive, and like any other real investment, requires patience and discipline. Those looking to make a quick buck out of marijuana are likely to fail,” Herzberg says.

John Torrens, a Professor of Entrepreneurship Practice at Syracuse, and a board member of the Cannabis Sustainability Committee, also warns about potential risks to investors. “Even though the U.S. Department of Justice has directed law enforcement not to pursue cannabis businesses that operate within local and state regulations, the feds still use size as a proxy for illegal activity and have a tendency to harass large operations, which would make the best investment opportunities.”

Regulatory ambiguity is keeping a lot of professional money out of the industry,” he continued, “which creates room for smaller investors to establish a foothold,” Torrens says. “Plus, once federal regulators reschedule cannabis as a schedule two instead of a schedule one drug, then the doors will be open for professional and institutional money to pour in,” he says. “This will be the big exit opportunity for the early investors.”

Some Tips to Keep You Safe

The cannabis industry can be very complex

Torrens offers some helpful suggestions to anyone researching cannabis and hemp investment opportunities:

  • Play by the Rules. It’s important to find a company that not only knows how to grow and extract, but is also fully compliant with their state. “Compliance needs to be a top concern,” he says. Seriously, nothing is worse than putting your money into a company, only for the owner to get arrested, business is shut down, and you’re left high and dry.
  • Licenses and permits. Make sure the business you wish to invest in has the correct license and permits according to local regulations. “This is especially true in California where some municipalities have very loose regulations,” Torrens says. “This creates an opening for the feds to come in and shut it down.”
  • Distribution. You can choose the best growers out there, but if they don’t have the connections needed to be able to distribute their product, then it’s no better than investing in a Nasdaq company. You can have the best product in the world, but what good is it if no one knows about it?

“The market demand exists, but in an industry, that is just coming out of the shadows, the strength of relationships is critical,” Torrens says. “Go slow. If you think you want to play in this space, then start with a small, manageable investment.”

Popular Investment networks

A great way to get your feet wet in the research pool is to start by researching through cannabis and hemp investment networks. Here are a few places to get start.

  • ArcView Group – The granddaddy of cannabis investing, ArcView Group offers investment opportunities for venture capitalists, access to funding for business owners, and market research for anyone interested in learning more about Hemp and CBD financial opportunities.
  • CannaFundr – Whether you want to invest in new and growing companies, or you are a business owner looking for funding, CannaFundr is a great place to find like-minded people in your industry.
  • New Cannabis Ventures – New cannabis ventures was founded by the owner of 420 Investors, which is one of the largest, due-diligence platforms in the cannabis investment sector. Both sites are great sources of market information.

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Final Thoughts

Although figuring out how to invest in cannabis or hemp can be a challenge, it’s extremely rewarding when done correctly. And by correctly, we basically mean safely and legally, and with a bit (a lot) of due diligence and forethought. Don’t let the call of quick cash let you overlook any red flags that may stand out to you.

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