The whole truth about vape pen lung disease is yet to be determined, but the major media outlets have been surprisingly inept at covering the story, so in light of the scary headlines I’ve been seeing recently, this seems like a good opportunity to bring you up to date on what I’ve been able to learn about this issue.
What is Vape Pen Lung Disease?
- The disease is most likely due to contaminants or adulterants in black market vape cartridges.
- The number one suspect is a thickening agent derived from vitamin E known as vitamin E acetate.
These substances can be added to both nicotine and THC products, and for black market vendors, there’s little incentive not to—especially if it reduces costs.
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In that way, the story of vape pen lung disease is similar to that of bathtub gin nearly a century ago in this country, which occasionally had the potential to blind or kill people.
The long-term solution, of course, is legalization and regulation—which begins in Canada in December (where no cases of the illness have been reported), but is still just a dream in the U.S.
But many shortsighted people—in addition to people who are just plain anti-cannabis—are now calling for a ban on vaping, and that’s just stupid.
For anyone buying legal vape cartridges—which have been sold for years in some states—there’s no more danger now of than there ever was. And for people in states where vape cartridges are not legal yet, the remedy is to either return to smoking marijuana the old-fashioned way, or to buy vaping supplies out of state from a legal seller.
Hopefully, the authorities will recognize the real problem before the cries to ban vaping get too loud. If not, can I coin a new word—Vapegate?
Cannabis 2.0
In the meantime, the approach of Cannabis 2.0 on December 17, when cannabis edibles, beverages and vapes will become legal across Canada, looms large.
As with the legalization of marijuana flowers, plants and oils in Canada last year, I expect that demand will initially exceed supply. No doubt that’s something the media will label a failure. But I call it growing pains, and it’s to be expected in an industry evolving this fast. (In the most recent quarter, the average stock in my Cabot Marijuana Investor portfolio saw revenues grow 273% from the year before. That’s fast!)
But what I’m focusing on as I guide investors in the cannabis sector are not those often misguided media stories; what I’m focusing on is the action of the Marijuana Index, as well as the leading stocks in the sector, and what I’m seeing has me very bullish about the months ahead!
Marijuana Index
After a 44% drop from its April high to its late-August low, the Marijuana Index has now begun a new uptrend. And what I like about this is that it’s happening despite the bad news about vaping!
As we all know, stocks peak on good news and bottom on bad news, and the fact that the recent bad news has failed to drive marijuana stocks any lower means the bottom is in!
Also comforting is the fact that the broad market has turned up again; one of Cabot’s key intermediate-term trend-following indicators turned positive less than two weeks ago, and as we all know, it’s much easier to make money when the market’s main trend is up!
Odds are, therefore, that this nascent uptrend in cannabis stocks will grow stronger—and I’m beginning to think (though it’s foolish to predict) that this uptrend could peak in mid December, when Cannabis 2.0 kicks in across Canada.
If so, you’ll definitely want to have some profits to take then, and the best way to get them is to be a buyer now!
In fact, just last week I recommended some additional buying for readers of my Cabot Marijuana Investor, averaging up in three of our portfolio holdings that I had taken profits as the downtrend got under way. Now, with those stocks cheaper and heading in the right direction once again, I’m telling my readers to get back on board.
Accelerating Revenue Growth
Last but least, there’s one more piece of good news.
With second-quarter financial reports in the books, I’m pleased to announce that three of my portfolio holdings in Cabot Marijuana Investor have achieved one of my favorite fundamental milestones, which is accelerating revenue growth.
One major Canadian cannabis company, for example, grew revenues 106% (year-over-year) in the fourth quarter, 616% in the first quarter, and 969% in the second quarter!
Accelerating revenue growth is a very good indicator of higher prices ahead, because analysts are behind the curve; they just can’t revise their estimates fast enough. In short, these three marijuana stocks in particular could do very well!
For details, click here.
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