Marijuana News Today: Pot Industry Continues to Boom in the U.S.

Marijuana News Today
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Marijuana News Today

The marijuana news today has us celebrating the ever-growing pot market in the U.S. as it creates jobs and generates huge sales. This represents a massive opportunity for growth among pot stocks when federal U.S. marijuana legalization eventually comes.

Today’s look at the massive pot boom comes to us by way of The New York Times, which is in and of itself a big deal. After all, whenever the Gray Lady writes about something, you know it has largely hit the mainstream.

The main thrust of the article is that the hundreds of thousands of jobs created by the marijuana sector in its current state are already a great start. (Source: “Cannabis, Marijuana, Weed, Pot? Just Call It a Job Machine,” The New York Times, April 25, 2019.)

I would add that this is but a precursor to the massive economic boon that U.S. marijuana legalization would be.

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This is very important for the future of marijuana stocks. If there’s one thing politicians love, it’s job creation. Marijuana is a proven job creator and, as such, makes selling it to voters that much easier.

With these stellar numbers being reported in the most prestigious national paper in the country, it marks another milestone for pot stocks. The push for U.S. marijuana legalization on a national scale is still on the go, and articles like that will certainly help smooth along the process.

We’ve already seen state legislatures step up to the plate as of late, legalizing marijuana through traditional procedures instead of using referendum votes to provide the impetus to table legislation.

As politicians increasingly become more comfortable selling pot reform to their constituents, we’ll see pressure mount to change the laws at the federal level and legalize pot for every American.

While that may still be a few years away, I’ve never been more optimistic that marijuana reform will take place in the U.S. in the near future.

All signs are pointing toward that outcome. Higher government revenue, lower crime, massive job creation, etc.—it’s not a hard sell by any means, and we’re likely to see the pitch take place in the U.S. sooner rather than later.

HEXO Stock

The marijuana news today did not mirror the pot stock market, which was quite flat this morning. While yesterday saw stocks gaining or losing a point here and there, today appears to be a general down day for pot company shares.

There don’t appear to be any major setbacks causing this, but the overall picture is that today is a slow one for marijuana stocks.

One company that was able to see gains to start the day—if only a small amount—is Hexo Corp (NYSEAMERICAN:HEXO). The stock gained half-a-point in early-morning trading and finds itself up by nearly eight percent over the past five days.

HEXO stock remains one of my top picks in 2019, and it will likely remain so for many years to come.

There’s a lot to love about this company, which I’ve written about several times before.

Its latest triumph came when Bank of America Corp (NYSE:BAC) began its coverage of marijuana with a note supporting Hexo.

The Bank of America note named HEXO as among the top pot stocks, largely in keeping with my own projections. (Source: “HEXO Is Top Pick as Bank of America Initiates Cannabis Coverage,” TheStreet, April 17, 2019.)

The wins continue to roll in for HEXO stock. Investors who had followed my advice about the stock over the past few months would have seen huge improvements to their portfolios. I believe that will continue for some time yet.

TLRY Stock

In contrast to Hexo, we have Tilray Inc (NASDAQ:TLRY), a company I’m not too sure about. TLRY stock dropped one percent in early-morning trading today and has remained flat over the past five days.

Tilray stock continues to be one of the biggest disappointments of 2019. There just isn’t all that much going on at the company right now that excites investors. Couple that with the stock’s massive leap following its initial public offering (IPO) and you have a recipe for a decline.

That’s exactly what has been happening with Tilray stock.

Now, that doesn’t mean TLRY stock is doomed to be a clunker forever. But it does mean that it’s hard to recommend the stock when so many other pot stocks are outperforming it.

I’m not alone in my negative prognosis: a fund manager at CastleMoore Investment Counselling is similarly down on Tilray stock.

“This whole area is a real quandary for me because there are so many variables. Tilray is such a new issue. It got to $300, but I see no support until we hit around $35 for Tilray,” said portfolio manager Hap Sneddon. (Source: “Tilray is in trouble, this fund manager says,” Cantech Letter, April 15, 2019.)

“I think you could see $34. We’re right around $48 but there’s nothing to hold it there anymore and I don’t see any catalysts in the sector.”

I agree. There’s still a ways yet that Tilray can fall before it balances out. I would be patient before jumping in on the company.

CRON Stock

As in the tale of the Three Bears, so too in the stock market; Cronos Group Inc (NASDAQ:CRON) represents the middle between Tilray and Hexo.

While TLRY stock has a lot of concern surrounding it and HEXO stock is full of potential, Cronos stock falls between the two, although I’d put it more toward HEXO’s side of the spectrum.

CRON stock remained flat in early-morning trading today but it has jumped by four percent over the past five days.

The company continues to show pretty strong potential, but it’s rather large and therefore prone to slower growth—save for when it makes big moves that spur investment.

The last major move by Cronos was its deal with Altria Group Inc (NYSE:MO), which saw the first union between Big Tobacco and marijuana and injected $1.8 billion of capital into the company.

I am bullish on CRON stock, if only because I believe that the marijuana industry will continue to grow and propel solid stocks like this upward. Having said that, Cronos has the opportunity to be a real star if it can score another win like its Altria deal.

HEXO, TLRY, and CRON Stock Performances

The performances of HEXO stock (black line), CRON stock (blue line), and TLRY stock (red line) over the past week are seen on the chart below:

Chart courtesy of StockCharts.com

Analyst Take

It’s getting harder every day for people to argue against marijuana legalization; the marijuana news today exemplifies that.

The numbers for the pot sector are in and they look great. It’s just a matter of time before politicians in the U.S. are able to turn those hard numbers into policy platforms that push legalization on a federal scale. In fact, we’re already seeing that take place in the Senate, the House, and in the presidential race.

U.S. marijuana legalization is on its way, and with it comes a huge opportunity for growth among pot stocks.