In a stunning reversal, powerful conservative politicians are suddenly expressing major support for the cannabis industry.
Most importantly, President Trump has promised to support federal legislation to protect state cannabis laws.
This revolutionary shift in US cannabis policy is creating a huge opportunity for investors.
Here’s a clip from a Bloomberg article with more details:
President Donald Trump endorsed letting states decide how to regulate marijuana, in a major boost for the legal pot industry.
Colorado Republican Senator Cory Gardner said that as a result of Trump’s assurances, he’ll end a blockade of Justice Department nominees. Gardner held up the nominees after Attorney General Jeff Sessions rescinded an earlier Justice Department memo that shielded marijuana operations in states like Colorado from enforcement of the federal ban on the drug.
“Since the campaign, President Trump has consistently supported states’ rights to decide for themselves how best to approach marijuana,” Gardner said in a statement Friday. “President Trump has assured me that he will support a federalism-based legislative solution to fix this states’ rights issue once and for all.”
John Boehner, the former Republican speaker of the House of Representatives, invested and joined the board of one of the largest cannabis companies in the US.
On April 20, 2018, New York Senator Chuck Schumer (D-NY) announced plans to introduce a bill that would reschedule the drug classification of cannabis.
These legal game changers could unleash billions in new sales and profits for investors, setting these 7 cannabis stocks soaring.
#1 – High Hampton Holdings Corp
Ticker: CSE: HC, OTC: HHPHF
Market Cap: $29.7M
YTD Return: 96.87%
High Hampton is a young Canadian company that is making big investments in California’s high-growth cannabis market.
For example, on April 18, 2018, HC announced that it is buying Caligold – a well-established and recognized edibles brand already generating millions in revenue.
I see a US-based, OTC ticker HHPHF. However, this ticker is not very liquid. Average daily trading volume is just 3,000. With a share price of $0.84, that means just $2,500 in shares are trading hands every day.
I prefer the Canadian ticker – but the US ticker should get the job done too.
#2 – Sunniva, Inc.
Ticker: CSE: SNN, OTC: SNNVF
Market Cap: $137.2M
YTD Return: 56%
Sunniva is another direct play on California’s high-growth cannabis industry and evolving US cannabis policy.
The company is building a 498,000 square foot cannabis greenhouse in Southern California’s Cathedral City that would be one of the largest in the state.
Phase I will be a 325,000-square-feet facility expected to produce 177,000 pounds of dry cannabis annually, with around 50% of production converted into oils and extracts.
Phase II will add 164,000 square feet to the facility, adding 100,000 more pounds of cannabis produced each year.
#3 – Cara Therapeutics
Ticker: NASDAQ: CARA
Market Cap: $782.2M
YTD Return: 55.75%
Cara is an up-and-coming cannabis biotech headquartered in the US. Cara has one of the most promising drug pipelines in the cannabis sector – developing cannabis-based drugs to treat pain and pruritus.
Cara’s lead drug candidate, CR485, is in a late-stage study for the treatment of postoperative pain and a treatment of chronic kidney disease-associated pruritus (CKD-aP) which leads to chronic itching for dialysis patients.
This is a promising drug candidate that we’ll want to keep our eye on. I would expect that any good news on CR485 would give shares a nice jolt.
#4 – Innovative Industrial Properties
Ticker: NYSE: IIPR
Market Cap: $754.8M
YTD Return: 67.75%
IIPR is headquartered in San Diego and operates in the US.
Shares are traded on the NYSE, making this the only cannabis-related listing on the Big Board.
IIPR owns a real estate portfolio of commercial cannabis greenhouses that it rents to domestic cannabis growers looking to ramp production.
This is a unique cannabis stock. I don’t know of any other company with this business model.
For example, IIPR building a 72,000 square foot greenhouse in Maryland. It just announced a deal to buy a 350,000 square foot greenhouse in Arizona.
Looking forward, IIPR has a robust pipeline of potential investment properties and is expanding its portfolio of commercial cannabis greenhouses.
#5 – Grow Generation, Inc.
Ticker: OTC: GRWG
Market Cap: $88.4M
YTD Return: 44.65%
Growgen is a pick-and-shovel play on the US cannabis industry, selling growing supplies and equipment to US cannabis producers.
Growgen has one of the best financial profiles in the US cannabis industry. That means it has strong sales, strong sales growth, and an attractive valuation.
The company posted revenue of $29M in 2018, up over 102% from their 2017 figures.
With that revenue increase, Growgen looks like one of the most undervalued stocks in the entire cannabis sector. That is important because value stocks are hard to find in the cannabis industry.
#6 – Cannabix Technologies
Ticker: CSE: BLO, OTC: BLOZF
Market Cap: $112.2M
YTD Return: 2.83%
Cannabix is an early stage Canadian company that makes a “marijuana breathalyzer.”
Its cannabis breathalyzer product is still in development which means revenue could be months or even years away.
That makes this a higher risk-reward cannabis stock.
Shares are traded on the Canadian Stock Exchange under the ticker symbol BLO. I see average daily trading volume of 1.2 million so that is liquid enough for 99% of regular investors.
#7 – Americann, Inc.
Ticker: OTC: ACAN
Market Cap: $41.6M
YTD Return: -13.74%
ACAN is a US cannabis stock that is headquartered in Colorado.
This company hopes to be a supplier for the major markets on the East Coast who have legalized recreational and/or medical cannabis.
In order to achieve that goal, ACAN is in the early stages of building the Massachusetts Medical Cannabis Center (MMMC), which could eventually be a 1 million square foot cannabis greenhouse.
I expect big things from ACAN.
About the Author
Michael Vodicka is an equity analyst with more than 20 years of experience trading and investing. His research has been featured in some of the industry’s most respected publications. He has been investing and leading investors in the cannabis sector since 2013.