Which Marijuana Stock Could Be The First to $1 Billion?

There are already several high-performing marijuana stocks on the NASDAQ today, and some investors are already wondering, which will be the first to reach $1 billion in market capitalization?

Over the last couple years the marijuana industry has been growing like a– well– growing like a weed!

According to Forbes Magazine, at the marijuana industry’s current rate of phenomenal growth (even faster than the dot com boom of the 2000s), we can expect to see legal marijuana business sales north of $20 billion by the year 2021 just five years from now.

U.S. public opinion in favor of legal marijuana is more robust than ever and on an upward trend while 29 states have legalized medical marijuana and several of them like California, Colorado, Alaska, and Washington have legalized it for recreational consumption.

As the inevitability of legalized marijuana businesses nationwide becomes more and more apparent, and as marijuana business sales take off into the stratosphere in 2017, there’s already chatter out there about which marijuana business stock will be the first to top a $1 billion valuation.

The Motley Fool, a multimedia financial services company that employs 300 people in Alexandria, Virginia, providing financial and investment advice since 1993, has raised the question and says the five marijuana stocks most likely to hit that big triple comma stock valuation are:

1. GW Pharmaceuticals (NASDAQ:GWPH) – A cannabinoid-based drug developer that currently has the highest market cap by far of any marijuana stock.

2. Corbus Pharmaceuticals (NASDAQ:CRBP) – It’s more of a high-risk, high-reward stock than GW Pharmaceuticals, because if one specific clinical trial for a synthetic oral endocannabinoid-mimetic drug goes its way, Corbus could leap to $1 billion in annual sales with a medical marijuana treatment for cystic fibrosis, which is notoriously difficult to treat.

3. Canopy Growth Corp. (NASDAQOTH:TWMJF) – A Canadian producer and retail seller of medical marijuana products and oils. (Medical marijuana has been legal in Canada since 2001.) Canopy just completed its acquisition of Mettrum Health earlier this year, and got a 472,000 square foot facility for it that includes its current corporate headquarters, plus access to more medical marijuana patients.

4. Aphria (NASDAQOTH:APHQF) – Aphria is one of Canopy’s biggest competitors, and holds the distinction of being one of the most consistently profitable marijuana stocks after reporting five consecutive quarterly profits.

5. Aurora Cannabis (NASDAQOTH:ACBFF) – Aurora Cannabis has been light on profits lately, but only because of an aggressive round of expansion-based spending, which it says will increase its marijuana plant production capacity nearly ninefold, after investing in creating the most technologically advanced automated cannabis-grow facility in the world.

Our Very First Actively Managed Marijuana ETF May Be On Its Way

Cannabis Investment

US SEC CLEARS WAY FOR CANNABIS EFTs

On Friday, May 5th, Cambria Investment Management filed an N-1A form with the US Securities and Exchange Commission (SEC) for not just one, but five new ETFs. The diverse basket of proposed funds cover a wide range of industries (real estate, cannabis, robotics and AI), and also include two tax optimized funds – one domestic and one foreign.

The stand-out of the bunch – and the one that is perhaps kicking up the most attention – is the Cambria Marijuana Industry ETF. The proposed fund, if successfully launched by Cambria, will be given the ticker “TOKE.”

Cambria’s Marijuana ETF will track publicly traded companies that support or directly work in the legal production of cannabis, including: companies that legally produce marijuana, those that conduct legal research into its medical or pharmaceutical use, and those that design and manufacture equipment used in the marijuana sector.

While it may be the first cleverly-named marijuana ETF, TOKE is not the first ETF to deal in cannabis-related stocks. The proposed fund will follow on the heels of the first-ever marijuana ETF, the Horizons Medical Marijuana Life Sciences ETF (TSX:HMMJ) – which launched at $10.00 per share last month and is now sitting at $9.59. While the fund trades in Canada, American investors have been able to get in on the action via its listing on the OTC.

Horizon’s ETF isn’t alone, either. In February, a filing popped up for a fund called the Emerging AgroSphere ETF. The proposed fund, which comes from New Jersey-based ETF Managers Group, will include companies exclusively in the medical marijuana space and – if approved – will list on the NYSE Arca.

Both HMMJ and the Emerging AgroSphere ETF are passively managed, meaning the indexes they are based on dictate their performance. This means that TOKE has the potential to be the first actively managed ETF in North America. At the time of writing, there is no indication yet as to when the two remaining ETFs might launch.

There is still no telling how well these (hopefully) soon-to-be-launched ETFs will perform in the market, especially considering the fact that HMMJ has declined by about four percent since it began trading. But, at the same time more and more states are legalizing medical cannabis, and – according to Arcview Market Research – sales in the marijuana sector as a whole grew 30 percent in 2016 alone. The industry is also projected to triple in size over the next four years.

Marijuana Businesses Better Stock Up On This Product in 2017

There are some big changes happening in cannabis consumer preferences that marijuana businesses should pay close attention to in 2017!

marijuana businesses should stock up on cannabis oil for vape pens

Earlier this year the California-based marijuana delivery service called Eaze (known as “The Uber for weed”), released its second annual “State of Cannabis” report.

The report draws on data from 250,000 California users and a survey with 5,000 respondents to provide a very comprehensive picture of your customers if you’re in the marijuana industry.

If you’re not selling cannabis oil cartridges as part of your marijuana business and making a concerted effort to advertise this product category to your clientele, you’re missing out on a big opportunity in a rapidly growing cannabis product segment.

According to Eaze’s first report at the beginning of 2016, marijuana oil cartridges for vaping were a mere 6% sliver of overall sales for the past year. This year sales of marijuana oil cartridges are up over 400% making up a full 24% of the delivery service’s sales.

As more cannabis consumers take to vaporizing their weed, fewer and fewer are purchasing the raw plant itself. Over the last year sales of the marijuana plant’s raw flowers fell from 75% to 54%.

Customers are less interested than ever in lighting up and smoking, when they can use a cleaner, less harsh vaporizer, or purchase any number of edible cannabis products ready-made, that they don’t have to prepare themselves.

Finally, consumer purchases of flowers, edibles, and concentrates that are primarily CBD-based has increased 38% over the last year.

CBD or cannabidiol, is a cannabinoid that is remarkable for providing consumers with many of the palliative and medical benefits of marijuana, without producing the characteristic psycho-active “high” that is caused by THC.

Marijuana businesses that are paying attention will cater to the increasing consumer demand for these product categories.

Investing in The Marijuana Industry Promises Huge Returns

Investing in the marijuana industry has never looked more lucrative.

investing in the marijuana industry yields big returns

Earlier this year, Forbes astounded its audience by noting that 2016 marijuana sales in the US states where it’s legal outmatched the Dot-Com boom of the early 2000s.

They based this on a report by Arcview Market Research, which is the market leader in data research for legal marijuana market in the United States. According to Arcview, legal marijuana sales in North America grew to $6.7 billion in 2016.

As Forbes Magazine observed, by comparison the entire US GDP during the Dot-Com era grew at 22% versus the 30% growth we’ve seen in the marijuana market to achieve those kind of number sin 2016. And remember that at the time, the dot-com expansion was considered unparalleled in its scope and magnitude.

Arcview’s editor, Tom Adams wrote:

“The only consumer industry categories I’ve seen reach $5 billion in annual spending and then post anything like 25% compound annual growth in the next five years are cable television (19%) in the 1990’s and the broadband internet (29%) in the 2000’s.”

At the rate the marijuana industry is growing, we can reasonably project legal cannabis sales north of $20 billion by the year 2021 just five years from now.

Consumers clearly value marijuana for its psychoactive effects, the characteristic “high” caused by the THC in its leaves, rewarding consumers with relaxation, greater enjoyment of their company and surroundings, increased insight, and greater creativity.

Many consumers use marijuana the way American workers have used alcoholic beverages since this country was founded, as a way to unwind after a hard day’s work. The demand for legal marijuana is undoubtedly robust and hardly flinching at federal prohibition of cannabis and cannabis products.

Investing directly in marijuana dispensaries themselves or cannabis farms is just one way of investing in the marijuana industry. Another is to invest in the various auxiliary businesses the provide support and business infrastructure to this multi-billion dollar boom industry.