Marijuana News Today
It’s seeming like 2019 will be the year Wall Street finally catches up with the rest of us, as the marijuana news today shows more major banks looking to get into the marijuana trade in advance of what is sure to be a global industry in the years to come.
There are rumblings that analysts within massive U.S. banks, namely Goldman Sachs Group Inc (NYSE:GS) and Bank of America Merrill Lynch, have been looking into the cannabis industry for some time now. (Source: “Wall Street banks face hurdles as they rush to cover the suddenly booming marijuana industry,” CNBC, February 3, 2019.)
Now, there are good reasons why Wall Street has been reluctant to join the marijuana rush—and some not-so-good reasons.
There is still a federal ban on marijuana in the U.S., which makes banking complicated, to say the least, when it comes to storing cash from what is essentially an illegal trade taking place within the country.
Holding money that could, theoretically, be seized at any time by the federal government is a risky venture for banks. There’s upside by way of huge gains, but the risk is simply too much to bear. That’s understandable.
Other factors, like the illicit reputation of marijuana, also prevented some major institutional investors from getting involved. With the gift of hindsight, I’m sure those analysts are giving their butts a good kicking right now.
Which is to say that Wall Street is warming up to marijuana. After all, Wall Street only sees green—money, that is. And money is rolling in fast and large in the pot industry.
These banks won’t be able to interact with marijuana stocks the same way they do with other industries until the fear of a federal crackdown subsides. That won’t happen until we see major political reform take place on the national stage.
Unfortunately, so far, no major U.S. Democratic presidential candidate has come out with a major marijuana reform plan, although some have introduced bills in Congress that could carry over into the campaign or the presidency, should one of those pot-friendly Democrats win. But that’s getting way ahead of ourselves.
For now, the marijuana news today is a solid reminder that the marijuana industry is still growing. Not only in a hard-numbers way, but also in terms of acceptance.
This legal cannabis industry is no longer a baby, but it still very much an infant, getting its legs under it and learning to walk.
This is great news for marijuana bulls because, as we know with infants, they love playing, throwing tantrums, and growing. In this case, the growing part should have everyone excited.
ACB Stock and RDDTF Stock
In the marijuana news today on the pot stock market, we have Aurora Cannabis Inc (NYSE:ACB) climbing big after announcing a technological breakthrough of sorts.
Radient Technologies Inc (OTCMKTS:RDDTF, CVE:RTI), an extraction partner of Aurora, received its Standard Processing License from Health Canada on Monday. (Source: “Disruptive Technology an Important Component of Aurora’s Derivative Products Strategy,” Aurora Cannabis Inc, February 4, 2019.)
The move helped juice both Radient and Aurora stock, sending the companies soaring yesterday.
Today, RDDTF stock took a bit of a dip, dropping over one percent. ACB stock, meanwhile, did the opposite, gaining near two percent.
Over the past five days, however, RDDTF stock soared 35%, while ACB stock had a much more moderate (but still great) 15.5% climb.
Aurora first got involved with Radient in 2016, excited by its extraction technology that it claims can be, “potentially disruptive” due to its increase in efficiency and yields.
The press release also spoke at length about the company’s presence in the cannabidiol market. Aurora is looking to make big gains on the back of the Agriculture Improvement Act of 2018 that has opened up the American hemp market.
It makes sense that it would remind investors of its acquisitions in that segment to continue to prompt excitement over what could be the defining marijuana market development of 2019.
In any case, the news was strong for both ACB stock and RDDTF stock, even if Radient took a bit of dip to start today.
Considering how fast it jumped over the past week, it makes sense we’d see a bit of a correction.
In any case, ACB stock is climbing its way back into my good graces after a weak 2018. It still has a long way to go, but I’m hopeful that it can make 2019 a comeback year. I’m on the lookout for a partnership with Big Tobacco or Big Alcohol on the horizon, which would really return Aurora stock to primacy.
Radient, on the other hand, is a marijuana penny stock with a lot of potential. However, as with all marijuana penny stocks, it also carries with it an extra bit of risk.
But Radient isn’t the only pot stock getting a speeding ticket today. Cronos Group Inc (NASDAQ:CRON) is also down big after having a huge week of gains.
Up over 23% during the past week, CRON stock has had a roaring start to 2019.
As a result, the company took a big hit to start today, down seven percent in early-morning trading.
This isn’t uncommon, with marijuana stocks often having the breaks pumped when they grow too fast.
CRON stock has been on the receiving end of a lot of good press lately. Finishing 2018 strong with a Big Tobacco partnership, since then CRON stock has been one of the media favorites in the marijuana sector.
And, frankly, I’ve come around to favoring the stock myself.
While I was skeptical of CRON stock for a long while, it has since proven itself to me.
At first, it was too erratic and profiting too much from its Nasdaq listing hype. But Cronos Group stock has made several very concrete deals that have strengthened its position in the market.
Furthermore, Wall Street analysts have singled out CRON stock alongside a few other favorites as pegged for greatness.
So while CRON stock may be down today, it has a very bright future that I think will see it move towards big gains for many years to come.
ACB, RDDTF, and CRON Stock Performances
The performances of ACB stock (black line), RDDTF stock (blue line), and CRON stock (red line) over the past week are seen on the chart below.
Chart courtesy of StockCharts.com
The marijuana news today is all about maturity.
On Wall Street, we’re seeing more analysts warm to the idea of marijuana coverage. While U.S. federal law will still largely prevent major institutional banks from getting involved in marijuana directly, the newly opened hemp market could see huge money flow into the cannabis industry from these institutional investors, much to the joy of pot bulls everywhere.
On the pot stock market, we have licensing and technology stories grabbing headlines, boosting both Aurora and Radient stocks. Both stocks are up big over the past week as a result.
Overall, the industry continues to grow and expand, and it’s looking like 2019 could be a fantastic year for marijuana.