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Marijuana stocks, as represented by the ETFMG Alternative Harvest ETF (MJ), have slightly outperformed the broader market. MJ has provided a total return of 36.9% over the past 12 months, above the Russell 1000 index’s total return of 35.0%. These market performance numbers and all statistics in the tables below are as of Aug. 23, 2021.

The marijuana industry is made up of companies that either support or are engaged in the research, development, distribution, and sale of medical and recreational marijuana. Cannabis has begun to gain wider acceptance and has been legalized in a growing number of nations, states, and other jurisdictions for recreational, medicinal, and other uses. Some of the biggest companies in the marijuana industry include Canopy Growth Corp. (CGC), Cronos Group Inc. (CRON), and Tilray Inc. (TLRY). Many big marijuana companies have continued to post sizable net losses as they focus on investing in equipment to speed up revenue growth.

HITI.V is top for value and JUSH.CX is top for growth and momentum

Momentum investing is a factor-based investing strategy in which you invest in a stock whose price has risen faster than the market as a whole. Momentum investors believe that stocks which have outperformed the market will often continue to do so, because the factors that caused them to outperform will not suddenly disappear. In addition, other investors, seeking to benefit from the stock’s outperformance, will often purchase the stock, further bidding its price higher and pushing the stock higher still. These are the stocks that had the highest total return over the last 12 months.

Here are the top 5 marijuana stocks with the best value, the fastest growth, and the most momentum.

These are the marijuana stocks with the highest year-over-year (YOY) sales growth for the most recent quarter. Rising sales can help investors identify companies that are able to grow revenue organically or through other means, and find growing companies that have not yet reached profitability. In addition, earnings per share can be significantly influenced by accounting factors that may not reflect the overall strength of the business. However, sales growth can also be potentially misleading about the strength of a business, because growing sales on money-losing businesses can be harmful if the company has no plan to reach profitability.

Another factor that could cause upside in pot stocks is US marijuana legalization. On the state level, the cannabis industry has been growing rapidly across the US. On the other hand, much-needed federal policy changes on cannabis seem to be taking longer than investors and analysts expected. Although we have seen some progress in 2021, we still don’t have the introduction of cannabis legislation that will gain enough support to end prohibition.

This week Us cannabis companies are driving top marijuana stocks to invest in. For the most part, many leading American MSOs are delivering strong earnings, and some are setting record revenue growth. After reaching new highs in February 2021 the cannabis sector has been pulling back for the past five months. Now after several months of consolidation top pot stocks are bouncing off some of their lowest price points in 2021.

Best Cannabis Stocks In 2021 As Marijuana Companies Report Earnings

Verano is a vertically integrated multi-state operator providing access to regulated cannabis products to US consumers. In particular, the company produces premium cannabis products sold under its portfolio of consumer brands. Currently, Verano has its presence in 14 U.S. States, with active operations in 11. The company has 83 operational dispensaries, and 10 cultivation and processing facilities. In the future, Verano expects to surpass 90 dispensaries in 2021. Specifically, Verano operates dispensaries under retail brands Zen Leaf™ and MÜV™ catering to both medical and adult-use markets.

For investors, this could be a good time to research top marijuana stocks to buy. One important factor that investors should be aware of is market activity. Most important, the cannabis sector has been known to be one of the more volatile areas of the market. This makes investing in cannabis a higher-risk investment for traders. Because of this, you should always do your due diligence on a company before investing.

Verano completed the acquisition of TerraVida and The Healing Center. As a result, this acquisition gives Verano six dispensaries in Pennsylvania. In addition, the company has a permit to build an additional three in the state. To end July the company opened a flagship Pittsburgh dispensary with a four-lane drive-through. Verano announced second-quarter 2021 financials with record revenue of $199 million an increase of 164% year over year. As a result, gross profit on an unadjusted basis was $100 million or 50% of revenue.

This huge industry holds opportunities for long-term investors, but there are risks too.

U.S. cannabis companies can’t easily secure capital from banks or financial institutions since marijuana remains illegal at the federal level. Innovative Industrial Properties (NYSE:IIPR) helps to solve that cash shortage for growing marijuana companies by buying properties owned by U.S. medical cannabis operators and leasing those same properties back to them. The property sale to IIP provides the cannabis operator with much-needed cash, and the lease agreements create a steady revenue stream for IIP.

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Impact of COVID-19 on marijuana stocks

However, not all cannabis companies have fared well in the pandemic. Recreational cannabis retailers in tourist destinations such as Las Vegas saw their customer traffic dwindle, causing some of these dispensaries to start focusing on home delivery. In the medical segment, people delayed doctor visits, causing new patient starts to drop. Biotech companies experienced logistical challenges that affected sales and research progress.

Jazz Pharmaceuticals (NASDAQ:JAZZ) acquired the cannabis-focused biotech company GW Pharmaceuticals in May 2021. GW’s drug Epidiolex is the first cannabis-based medicine to be approved by the U.S. Food and Drug Administration (FDA). Epidiolex, which treats two rare forms of childhood epilepsy, is generating sales that are routinely surpassing expectations. While new patient starts for Epidiolex slowed slightly with the COVID-19 pandemic, the company has continued to deliver strong revenue growth.

First, let’s cover some of the basics you need to know before investing in marijuana stocks:

Source: Business Wire