As marijuana becomes increasingly legal in both the U.S. and Canada, it makes sense for growth-oriented investors to look for opportunities in the marijuana industry.
Up in Canada, where marijuana is legal nationwide, marijuana businesses are booming. In the U.S., we’re behind. But recreational marijuana is legal in a number of states, as is medical marijuana—and the numbers are going up. The trend is clear.
The Vermont legislature legalized medical marijuana way back in 2004, but it wasn’t until July 2018 that it became legal in the state to own an ounce of marijuana—and to cultivate two plants. So now thousands of Vermonters are doing just that.
And hemp, of course, is legal nationally, so plenty of Vermonters are experimenting with growing that, not only for CBD but also for fiber and soil remediation (hemp loves to suck up heavy metals).
While Vermonters may put their retirement funds in big, national establishments, like Fidelity and TIAA CREF, they don’t want big outside money coming in and disrupting what could be a thriving Vermont cannabis industry.
You see, Vermont likes being small and independent. Vermont has a very successful artisanal food movement—rooted in maple syrup and cheese—and a thriving craft brewery movement, so it makes sense that Vermonters want to grow their own cannabis industry.
Interestingly, one anecdote from Vermont concerns the health of its medical marijuana dispensaries. According to the president of the dispensary, which is owned by publicly traded iAnthus (ITHUF) (though that fact is not publicized), the advent of the grow-your-own law in Vermont marked the beginning of a steady drop in patients as more and more opted for the homegrown route.
You don’t, however, need to live in Vermont to invest in and benefit from this fast-growing industry. Several cannabis-related stocks have achieved one of my favorite fundamental milestones: accelerating revenue growth.
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.
And not all these companies are selling marijuana. For example, Real Estate Investment Trust (REIT) invests exclusively in properties for the cannabis industry. Another is a dividend-paying smokeless tobacco company that is diversifying into the cannabis accessories business. Another is focused solely on CBD, the product of the cannabis plant that doesn’t get you high but might treat everything from Alzheimer’s to anorexia, epilepsy to emesis, insomnia to indigestion, osteoporosis to obesity.
However, institutional investors are still leery of investing in the cannabis industry, mainly because marijuana is still not legal nationally in the U.S., and thus banking can be problematic.
And that means opportunity for you!
If you invest in marijuana and CBD stocks today, you will be getting in ahead of the big institutions, and thus when they finally start buying, their buying will benefit you!