More stock investors are wanting to go green, as the marijuana industry – even through market corrections – continues to show its promise for future growth.
But volatility characterizes the industry, making the risks of investment seem daunting to unseasoned investors. Or perhaps investors who are less tolerant of risk.
In an uncertain climate, three things can be said with relative consensus about marijuana stocks:
- Marijuana pot stocks invite a great deal of speculation.
- Demand for both legal medical and recreational cannabis is on the rise.
- Growth prospects are enticing for cannabis firms that can meet this demand.
So, for the investor who is willing to take risks and go green, which are the best pot stocks to invest in?
Aphria cannabis stocks
This Canadian cannabis grower and distributor is valued at $2.1 billion. Aphria shares reached record highs in January and have since fallen 32%. But, at $12.82 per share, the stocks have still increased more than 150% in value since October. Those who invest in Aphria are betting on the company’s rapid expansion, largely through the acquisition of strategic players in the field.
In the beginning of January, Aphria acquired competitor, Broken Coast Cannabis, for $187 million, which should boost their domestic sales. However, the more notable announcement came at the end of January when Aphria purchased Nuuvera for $167 million, labeling them a “global leader” in the marijuana, according to executives. Nuuvera opens the door for Aphria to distribute medical cannabis in Italy, bringing with it one of only seven available licenses to distribute in the country, as well as a deal to allow distribution in Germany.
Canopy Growth marijuana stocks
The leader in Canada’s marijuana industry, Canopy Growth is valued at $4.1 billion. Its stocks are not traditionally cheap, but, they trade at around 100 times the sale price, so buying in now might mean a long-term, profitable investment for cannabis stock investors.
Canopy Growth not only leads the sector in revenues and quantity of weed sold by weight, it’s also expanding into the recreational marijuana sector. It now has production facilities leased or under construction in eight Canadian provinces and plans for a marijuana cultivation facility in Denmark, which they expect to open doors for European export in the future.
For more information, read Canopy Growth Corp Still Looking Strong in Marijuana Stocks.
Constellation Brands cannabis stocks
Constellation is a popular American alcohol company that announced plans in October to purchase a $191 million stake in Canopy Growth. Among the first major alcohol companies in the U.S. to forge ties with a marijuana company, Constellation intends to sell marijuana-infused beverages. With a significant sector of their business coming from Mexican imported beers (i.e., Pacifico, Modelo, Corona), the company anticipates benefiting from the growing Hispanic population who are spending roughly one-third of their beer money on imported Mexican beverages. The company is valued at $41.7 billion and rated a “strong buy” for pot stock investors.
GW Pharmaceuticals marijuana stocks
GW is a biotech company based in England, though it trades as an American depository receipt in U.S. markets, valued at $3.4 billion. Their specialty revolves around the development of CBD drugs to treat epilepsy and epileptic childhood disorders. The company is awaiting patent approval in the first half of this year for their flagship drug, Epidiolex, which performed well in phase III trials last year with significant seizure reduction in sufferers of several epileptic disorders.
Huge projected sales for GW are dependent on the regulatory approval of this drug. Pot stock investors need to understand that investments in biotech companies are always a bet made on drugs that are still undergoing development. This company, however, appears to be on a positive trajectory and is rated a “buy” for MMJ stock investors.
Zynerba Pharmaceuticals cannabis stocks
Zynerba, valued at $156.4 million, is involved in the research and development of CBD-based drug treatments. Their biggest experiment, ZYN002, is undergoing trials with the hope of successfully treating epilepsy, osteoarthritis and a genetic condition, Fragile X Syndrome. Were the drug to progress past its trial phase, it would still be no less than 2 years from launching, with only a 40% chance of making it to the market. For MMJ stock investors willing to risk on a biotech firm, this company received a “buy” rating.
For more pot stock recommendations, read The Top Marijuana Stocks Thus Far in 2018.