With May nearly behind us, 2018 continues to truck on, and here we are with another marijuana forecast. Looking ahead to June, what does the marijuana forecast hold for pot bulls?
Well, it’s a bit of a mixed bag.
I’ve long held that this will be a strong summer for marijuana stocks. So far, we’ve seen that borne out.
May was certainly one of the best months this year for the legal marijuana industry, with gains seen among many of the top companies. Meanwhile, other cannabis companies that had been struggling finally saw some relief following the correction that began in January.
While May isn’t technically summer yet, it was in keeping with my predictions that we would see an industry-wide recovery following the pullback.
My next prediction is that, as the summer progresses, we’re going to see substantial gains for many top pot stocks.
Why is that? Momentum.
With Canadian marijuana legalization fast approaching, alongside aggressive expansion around the globe by the top pot stocks, we’re likely to see a renewed interest in the marijuana industry.
It’s worth noting that many marijuana stocks took some serious damage in the wake of the marijuana correction, with some dropping by as much as 40% over the year.
With those stock prices tanking, investors are eventually going to see these stocks less as toxic assets and more as bargain steals.
Aphria Inc (OTCMKTS:APHQF, TSE:APH) is a perfect example.
Aphria stock struggled mightily throughout 2018, but in May, the company was one of the top performers.
Chart courtesy of StockCharts.com
Aphria stock leaped up by 20% in May, made all the more impressive by how poorly it had been doing a few short weeks earlier.
That was something I had long suspected would happen. The decrease in the stock price once again made Aphria stock enticing to investors.
There wasn’t much in the news that helped propel the company, other than its heavily reduced stock price.
These types of situations are going to play out again and again in the coming months, I believe.
The issue is, however, that we may see a bit of a correction to compensate for overenthusiastic reinvestment.
So in June, we’re watching for two things: the first is investor interest in a recovering marijuana industry, and the second—and more important—is investor sentiment surrounding the marijuana market.
If investors go in too brashly, we’ll see an inflation of stock prices followed by a quick correction.
If not, I predict steady gains in the June marijuana forecast.
In either case, I don’t expect my overall outlook for marijuana this summer to be affected. Which is to say, I believe that good things are in store for the industry in the coming months.
I’m still very bullish on the marijuana market for summer 2018, but that doesn’t mean the road will be bump-free.
Obstacles in the form of mini-corrections may hit here and there, and that’s factored into my June marijuana forecast.
I firmly believe that marijuana stock prices are likely to rise in the coming months by double-digits. And if the rollout of Canadian marijuana legalization goes smoothly, I expect we may even see triple-digit growth.