Top Marijuana Penny Stocks 2017
There are very few industries generating as much buzz as the medical and recreational marijuana markets are these days. With legislation across the world generally trending toward the legalization—or at least decriminalization of the drug—growth potential is strong, with investors seeking out “the best marijuana stocks to buy 2017.”
What makes the industry even more attractive are the best marijuana penny stocks to buy now, which could allow you to get in on the market without having too much capital to begin with. In this piece, we’ll be tackling the marijuana stocks to watch, from cheap marijuana stocks to those that are a little bit on the pricier side.
While the industry is certainly booming and there are many great marijuana stocks to choose from, two major political developments could have a drastic impact on marijuana sales going forward.
The first development we’ll look at is the announcement coming from the Canadian government that recreational marijuana sales will be legalized in that country by 2018. That would make Canadian pot producers some of the best marijuana penny stocks 2017, seeing as how they are likely to get a huge boost if the government can come through on its promise. (Source: “Liberals to announce marijuana will be legal by July 1, 2018,” CBC News, March 26, 2017.)
The current Liberal administration in Canada headed by Prime Minister Justin Trudeau campaigned on a promise to legalize the drug for recreational use. While Trudeau and his government have been under fire for breaking a number of their other campaign promises, it seems that his is one promise that the Liberal Party is eager to fulfill.
Reports are coming in that the Canadian government wants to have a bill tabled before April 20, an important date to cannabis lovers, due to its correlation with 4/20, a sacred number among pot smokers.
Progress toward legalization in Canada would naturally have a huge impact on not only Canadian weed companies, but on cannabis producers the world over. Canada would be one of the first western nations to fully legalize the drug, depending on how the legislation ultimately reads when it is passed. As such, this is one of the key events that should influence your list of marijuana stocks to watch.
Marijuana Penny Stocks in North America
While by no means a done deal, the news coming out is still positive for the weed business, as evidenced by several Canadian marijuana companies seeing surges in share prices since the news broke that the government is pushing hard to implement legislation. (Source: “Marijuana stocks jump on legalization reports,” The Globe and Mail, March 27, 2017.)
Canadian weed companies (which feature heavily in this list) are obviously going to be the greatest impacted by new legislation, but the industry as a whole should benefit from a lessening of restrictions in a strong market.
Canaccord Genuity Group Inc (TSE:CF) released statistics claiming that the Canadian market could reach $6.0 billion in annual sales by 2021, and could hit that benchmark as soon as 2018. (Source: Ibid.)
Staying in the political realm, our focus shifts south to the U.S., where a relatively new president and his administration have been rather uneven on how the marijuana business will fare under their purview.
When looking at the best marijuana stocks to watch 2017, knowing the political landscape can, at times, be even more important than certain business aspects. That makes the uncertain tone of U.S. President Donald Trump when commenting on the state of weed laws something that might give pause to marijuana company investors.
When looking into how to invest in marijuana penny stocks, the last thing you want is the chance for extreme negative volatility. Penny stocks are volatile by nature, and the weed business hasn’t exactly been stable, but finding ways to mitigate the riskier aspect of that trade is always a good way to add some security to your investment. And one of those mitigation strategies would be avoid time of political upheaval, especially when the politics could easily go against you.
Examining the words of many of Trump’s senior officials and contrasting their words with Trump’s own words, and you get the outline of an altogether murkier picture.
While national legalization is nowhere near being a political reality in the U.S. at the moment (despite the majority of Americans agreeing that marijuana should be legalized), there is hope for action on the state level. A total of eight states have legalized recreational marijuana use, and 29 states have pushed through medical marijuana usage legislation. (Source: “What Jeff Sessions Said About Marijuana in His Attorney General Hearing,” Fortune, January 10, 2017.)
But, due to preemption, where federal law can overrule state law, federal regulations have still made certain aspects of the weed business difficult. For instance, banks that operate outside the states where pot is legalized are unable to accept money directly from the industry, forcing many pot sellers to resort to a cash-only business style.
And those federal laws are unlikely to be softened in the near future.
“Good people don’t smoke marijuana,” said Attorney General Sessions back in April 2016, when he was still senator of Alabama. “There is more violence around marijuana than one would think.” (Source: “Senators held a hearing to remind you that ‘good people don’t smoke marijuana’ (yes, really),” The Washington Post, April 5, 2016.)
And White House Press Secretary Sean Spicer hasn’t been too kind to the herb either. “I do believe that you’ll see greater enforcement,” said Spicer during a press briefing in late February. “There’s a big difference between the medical use … [and] recreational use, which is something the Department of Justice will be further looking into.” (Source: “Marijuana sellers face uncertainty under Trump,” The Hill, March 8, 2017.)
According to a Gallup, Inc. poll from October 2016, 60% of Americans now approve of legalizing marijuana. That’s the highest percentage recorded in the 47 years that public approval of the drug has increased. (Source: “Support for Legal Marijuana Use Up to 60% in U.S.,” Gallup, Inc., October 19, 2016.)
Despite this, the current administration is more than likely going to, at best, maintain the status quo around marijuana stocks and, at worst, come down hard on the industry with more regulations.
With the political landscape painted, let’s get to the marijuana stocks to watch.
How to Invest in Marijuana Penny Stocks
The thing to remember about the best marijuana penny stocks 2017 is that they are, by nature, extremely volatile. You’re acting on cheap stocks that are known for the lack of liquidity and, therefore, being mercurial within the confines of an industry similarly noted for its vulnerability to rapid change.
These factors do not make for a safe, steady stock. Instead, it makes for ones that are prone to seismic shifts. This does mean that there is a good amount of money to be made by the right investor. That said, below are the three cheap marijuana stocks we’ll take a look at.
|Best Marijuana Penny Stocks 2017||Ticker|
|Cara Therapeutics Inc||NASDAQ: CARA|
|Aurora Cannabis Inc||CVE: ACB|
|Aphria Inc||CVE: APH|
1. Cara Therapeutics Inc (NASDAQ: CARA)
The first stock we’ll consider is Cara Therapeutics Inc (NASDAQ:CARA).
Shares of CARA stock have jumped a jaw-dropping 80% since the beginning of the year. Over the last 12 months, that number improves to 187%. It has been a great time to be an investor in Cara.
With a number of cannabis-based drugs entering the final stages of testing in the near future, and CARA stock is one of the best marijuana stocks to watch. If the test results come back positive from the trials, then Cara will be in for massive gains in 2017.
2. Aurora Cannabis Inc (CVE: ACB)
Aurora Cannabis Inc (CVE:ACB) perhaps best fits the bill of what marijuana penny stock chasers are looking for: it has a low share price mixed with strong momentum. The company is Canadian-based, making it ideal to take advantage of the weed goodwill exhibited by the Canadian federal government.
The company has had a good 2017 so far, jumping upward by 10%, and that’s despite earlier trepidation seen in the Canadian weed industry as a whole before more information was released detailing the Liberal’s plan for legalization. But the number you really ought to consider is 4500%; that’s how much ACB stock grew in the past 12 months. Those types of gains are the ones that make analysts salivate.
After all, 4500% gains are enough to give any investor the munchies when looking at the marijuana stocks to watch 2017. Whether Aurora will be able to replicate such massive returns is not guaranteed, but continued political progress is only likely to continue to spur on growth.
3. Aphria Inc (CVE:APH)
While not as impressive as Aurora, with its massive rise, Aphria Inc (CVE:APH) has experienced strong returns of its own, gaining 421% over the past 12 months. Similar to Aurora, APH stock is one of the lower-priced marijuana stocks and, therefore, more aptly fits the bill of the best marijuana penny stocks of 2017, compared to a more household name like, say, Canopy Growth.
Aphria will also benefit from being based in Canada as the new legislation continues its path through the political organ grinder.
These are three of the marijuana penny stocks to watch now, ones that will see huge growth if their rates hold up, and even further gains if the legislative landscape shifts in their favor, as it appears to be doing in Canada.
While the political battle plays out in the U.S., Canada, and across the world, none of that has been able to slow the rapid growth of these three companies, much to their investors’ delight.