Marijuana News Today
The marijuana news today has pot investors salivating as shares continue to soar in June following a weak May for the industry, while opportunities continue to expand for U.S. pot stocks.
First, the U.S. pot stocks and their growing presence in the market.
To this day, the industry has largely been dominated by marijuana stocks that originate in Canada. Almost every stock I cover for Profit Confidential and my newsletter, Marijuana Millionaires, is from a company that is based out of the Great White North. And that makes sense.
Canada is the only developed economy in the world to have fully legalized all forms of marijuana, but that is a somewhat misleading fact. You see, in some ways, the U.S. is actually way ahead of Canada when it comes to the pot market.
Neil Selfe, founder and chief executive officer of Infor Financial Group Inc., believes that Canada has dropped the ball on marijuana legalization due to onerous policy decisions that will, in the long-run, allow the U.S. pot producers to dominate. (Source: “Canada ‘Blew’ Its Chance to Be the World’s Pot Leader,” Bloomberg, June 9, 2019.)
“I think we had a real chance to be global leaders,” Selfe said. He added that he only considered Canopy Growth Corp (NYSE:CGC) as a global leader in marijuana, while many U.S.-focused companies are quickly nipping at its hills and are otherwise poised to join it on the world stage, while Canadian pot stocks fall behind.
“It’s a real consumer product in big U.S. states where it’s legal, and it isn’t that way yet in Canada despite the fact that we were first,” Selfe explained.
While I don’t necessarily agree with all of Selfe’s pronouncements, he does have some valid points—specifically when it comes to marijuana regulation in Canada, something I’ve been harping on for a long time.
I believe that several other companies are what I would consider global leaders in the industry, but aside from his condemnation of the Canadian marijuana industry, a more optimistic reading would point towards the potential-filled U.S. marijuana industry as the future of pot.
Consider that more and more marijuana stocks are beginning to list on public exchanges, allowing investors to wet their beaks on the explosive and highly lucrative U.S. pot market.
Furthermore, we’re seeing advancements on the political front that were frankly inconceivable a few years ago. Now we’re a few votes away from potentially having a pro-marijuana president.
So while there is a lot more that Canadian pot stocks could do to keep a competitive edge, they are in a far better spot than Selfe believes due to their global presence, huge production capacities, and the ability to enter the U.S. market once legalization does come around.
On the flip side, he is absolutely right when he says the future of the industry is in the U.S.; look to America if you want to jump on the next big boom in the marijuana sector.
The marijuana news today is also largely focused on the massive rally we’re seeing across pot stocks, as June is proving to be a very strong recovery from May’s poor showing.
Since we already mentioned Canopy Growth at the top of this piece, why not continue and track CGC stock’s impressive gains of late.
CGC stock jumped nearly four percent in early morning trading and finds itself up 13.25% over the past five days.
Canopy Growth Corp has been rather quiet of late, not grabbing many headlines. 2019 began very much in the thrall of the company, with each week seemingly heralding a new triumph by the company.
While things have slowed on the news front, overall Canopy still appears to be going very strong.
The largest marijuana company in the world continues to see steady gains while also absorbing downturns better than most. That’s the advantage of being such a massive company.
We’ll likely see Canopy Growth Corp continue to grow at an impressive rate precisely because of the many strong fundamentals that have propelled CGC stock growth so far.
Another company that has been going strong of late is Aphria Inc (NYSE:APHA).
APHA stock found itself climbing four percent in early morning trading and jumped nearly 20% over the past five days.
Much of this was motivated both by the overall rally in the marijuana market and the company’s endorsement from Jefferies Financial Group Inc (NYSE:JEF) analyst Owen Bennett in late May.
“On our strategic scorecard Aphria scores highly, and third overall behind only Canopy and Aurora,” said Bennett. “Despite its strong global outlook, its valuation is the cheapest across our space, with allegations around inflated assets/insider deals weighing.” (Source: “Aphria leads cannabis stocks higher after Jefferies starts coverage with a buy rating,” BNN Bloomberg, May 27, 2019.)
Aphria Inc has been on rocky ground ever since its horrid 2018, but with the past few weeks seeing the company begin to pick up steam, APHA stock may be in store for a very strong recovery.
Another company that was a recent recipient of excellent news, Cronos Group Inc (NASDAQ:CRON) is one of the best performers on the day.
CRON stock gained nearly five percent in early morning trading and is up about 23% over the past five days.
Cronos, like Aphria stock, saw big gains following an upgrade from an analyst—this time from the folks at Bank of America Corp (NYSE:BOA), which gave the company a two-notch upgrade following Cronos Chief Executive Officer Mike Gorenstein claiming on June 4 that his company would be “aggressive” regarding a U.S. cannabidiol (CBD) launch. (Source: “Cronos Rises On Analyst Upgrade Following ‘Aggressive’ CBD Expansion,“ Bloomberg, June 5, 2019.)
Bank of America was impressed both by the company’s promise to pursue opportunities in the cannabidiol market, but also by the company’s partnership with Altria Group Inc (NYSE:MO), the markers of “Marlboro” cigarettes.
The use of Altria as leverage to enter the U.S. market is something that has analysts excited, which is why we’re seeing such impressive gains out of CRON stock.
CGC, APHA and CRON Stock Performances
The performances of CGC stock (black line), APHA stock (blue line), and CRON over the past week are seen on the chart below:
Chart courtesy of StockCharts.com
The marijuana news today should have every pot bull smiling.
The pot stock market showed a massive rally to start the week, in keeping with the otherwise very impressive gains so far in June. Following the pullback in May, this is welcomed news.
And even better, many are beginning to see the U.S. marijuana market show its true potential, meaning that massive gains could be in store for savvy investors who are able to take advantage of the second “green rush.”