7 Marijuana Stocks to Buy As the Industry Continues to Grow
Finding the best marijuana stocks to buy isn’t an easy task. However, despite having generally under performed, many still have a lot of potential.
market research by Grand View Research Inc.
That equates to a compound annual growth rate (CAGR) of 18% in each of the next seven years. The continued legalization of both medical and recreational marijuana in the U.S. and abroad is expected to propel the industry higher. This means there will still be promising marijuana stocks to buy as several should rise in coming years. While the road ahead might be volatile, there’s no doubting the potential growth that is waiting to be unlocked in marijuana stocks for long-term investors.
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Here are seven marijuana stocks that investors shouldn’t overlook:
- Canopy Growth (NYSE:CGC)
- Tilray (NASDAQ:TLRY)
- Aurora Cannabis (NYSE:ACB)
- Aphria (NASDAQ:APHA)
- GrowGeneration (NASDAQ:GRWG)
- Cronos Group (NASDAQ:CRON)
- Hexo (NYSE:HEXO)
Let’s take a look at what makes each among the best marijuana stocks to buy now.
Marijuana Stocks to Buy: Canopy Growth (CGC)
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We’ll start with the largest marijuana company by market capitalization, Canopy Growth. Being the biggest player in the recreational marijuana space has made Canopy Growth vulnerable to the industry’s growing pains over the past few years.
1.3 billion CAD loss for its fiscal fourth quarter, announced the layoff of 500 staff members and closed two of its largest greenhouses where it grows marijuana. The company also scrapped plans to open a new third greenhouse. Additionally, Canopy Growth has endured a lot of changeover among its executive ranks and board of directors. The Chief Executive Officer, Chief Operating Officer and Chief Commercial Officer have each changed in the past year.
All the turmoil has wreaked havoc with CGC stock, which is 41% below its 52-week high at $16.92 a share. Yet, there is reason to be optimistic about Canopy Growth’s future prospects.
novel coronavirus pandemic brought life as we know it to a halt, and Canopy Growth is cash rich, having 2 billion CAD in reserves. These facts mean that Canopy Growth is more resilient than many smaller marijuana companies and capable of withstanding the industry’s ups and downs. The company has also seen an upswing in its medical marijuana sales and recently launched a new U.S. focused e-commerce website called ShopCanopy.com that gave its shares a boost.” data-reactid=”58″>The company’s most recent fiscal first quarter results were much improved, demand for recreational marijuana has risen since the novel coronavirus pandemic brought life as we know it to a halt, and Canopy Growth is cash rich, having 2 billion CAD in reserves. These facts mean that Canopy Growth is more resilient than many smaller marijuana companies and capable of withstanding the industry’s ups and downs. The company has also seen an upswing in its medical marijuana sales and recently launched a new U.S. focused e-commerce website called ShopCanopy.com that gave its shares a boost.
Investors can expect that Canopy Growth will find its footing and that its share price will appreciate in time. As such, it remains one of the key marijuana stocks to buy.
Tilray (TLRY)
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Like most marijuana companies, Tilray has seen its stock get beat up over the past year. In fact, TLRY stock has fallen 85% in the past 12 months and is now trading at just over $7 a share.
second-quarter results that were downright scary. From April 1 through to June 30, the company lost $81.7 million, a 125% increase from the $36.3 million loss reported in the same period of 2019. Sales across all business segments, including hemp products, rose by only 10% year-over-year in the second quarter to $50.4 million. The poor results sent investors fleeing and TLRY stock fell 13% the next day.
more diverse than many marijuana companies, focusing on recreational and medical products, as well as hemp.
It all bodes well for the company’s long-term prospects. Plus, much of the second quarter loss can be attributed to one-time, non-recurring charges and a one time inventory write down. TLRY stock may surprise on the upside in the coming months.
Aurora Cannabis (ACB)
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grown nearly 250% between 2015 and when Canada officially legalized marijuana use throughout the country in 2018. However, the share price then fell 91% from its record high of $128.27 on poor earnings and a lack of demand for legal marijuana products.
But after reporting better than expected quarterly results this spring, the price of ACB stock jumped 200% in one week to $17.40 a share. Sadly, the stock has fallen again in recent months and now trades just under $10 per share. So what to make of this extremely volatile stock and the company behind it?
fluctuating demand and struggled to manage its inventory. The company has closed five of its production facilities and sold off its largest greenhouse that had one million square feet of production space. Aurora Cannabis has also halted construction on two other production facilities that had been in the works. With scaled down operations, Aurora Cannabis has forecast that it will post an operating profit by the first quarter of 2021. Time will tell if the company succeeds, but investors may want to consider grabbing ACB shares before they jump higher — again.
Aphria (APHA)
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stock is outperforming the broader sector. Since August 2019, APHA stock is down 25% to $4.63 a share, compared with a decline of 52% for the Horizons Marijuana Life Sciences ETF, which is widely used by analysts as an industry benchmark. There’s reason to be bullish on Aphria, which is doing better today than many of its peers.
notably Germany, due to several strategic acquisitions.
Put it all together and it’s easy to see that APHA stock has a lot of potential upside, which makes it one of the more promising marijuana stocks to buy now.
GrowGeneration (GRWG)
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stunning jump has been due to the fact that the company’s sales grew more than 100% in the second quarter on strong demand for its hydroponic and gardening products that are used by marijuana growers large and small.
Darren Lampert is confident, noting that his company is well-positioned to capitalize on a multi-billion dollar industry that is still in its infancy. If he’s right, and GrowGeneration can continue supplying marijuana growers with the equipment needed to cultivate the plant, then GRWG stock may be cheap at its current level.
Cronos Group (CRON)
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vulnerable to the challenges that have plagued the entire industry in the U.S. and Canada. Covid-19 related store closures, inconsistent regulations and government red tape, and a strong black market have conspired to hurt Cronos Group’s sales and growth. For the second quarter, the company reported an operating loss of $31.3 million, compared to a loss of $16.8 million in the year earlier period. The news sent CRON stock down 16% recently, and it currently trades at $5.44 a share.
well positioned to ride out the current turmoil and stay afloat until it can find firmer footing. The company ended the second quarter with more than $1.3 billion in cash and investments, which is more than most of its competitors. Equally positive, Cronos Group has almost no debt and there are signs that the entire marijuana market might be bottoming. Nowhere left to go but up — fingers crossed.
Hexo (HEXO)
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TAP) — failed to takeoff as hoped. Staff layoffs and production facility closures have followed.” data-reactid=”222″>Now we’re firmly into penny stock territory as Hexo’s share price is currently under $1 at just 72 cents per share. HEXO stock has been more beat up than most marijuana companies. In 2019, it was trading at nearly $8 per share. The sharp decline has come after Hexo’s marijuana infused beverages — it has a strategic partnership with beer maker Molson Coors (NYSE:TAP) — failed to takeoff as hoped. Staff layoffs and production facility closures have followed.
even Israel. This diversification offers a glimmer of hope for the battered HEXO stock and its shareholders.
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