Top Marijuana Stocks on the Nasdaq for October 2021

The marijuana industry consists of companies directly related to the research, development, and distribution of cannabis products, as well as companies that indirectly support these operations. Traditional stock market indices such as the Nasdaq continue to include more companies from the marijuana industry, as a growing number of regions around the world legalize marijuana. The number of U.S. states that permit marijuana use in some form increased to 36 after voters in several states approved marijuana legalization initiatives on their ballots in last year’s U.S. presidential election.

Some of the Nasdaq-listed marijuana companies include Tilray Inc. (TLRY) and OrganiGram Holdings Inc. (OGI). Many of these companies have managed to maintain revenue growth in spite of the COVID-19 pandemic.

Marijuana stocks, as represented by the ETFMG Alternative Harvest ETF (MJ), an exchange-traded fund, have outperformed the broader market. MJ has provided a total return of 47.6% over the past 12 months, above the Russell 1000’s total return of 40.7%. These performance figures and all statistics in the tables below are as of Sept. 23, 2021.

Here are the top three marijuana stocks on the Nasdaq with the best value, fastest growth, and most momentum.

These are the marijuana stocks trading on the Nasdaq exchange with the lowest 12-month trailing price-to-sales (P/S) ratio. For companies in the early stages of development or industries suffering from major shocks, this can be substituted as a rough measure of a business’s value. A business with higher sales could eventually produce more profit when it achieves, or returns to, profitability. The P/S ratio shows how much you’re paying for the stock for each dollar of sales generated.

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• HEXO Corp.: HEXO is a Canada-based, vertically integrated, consumer packaged goods cannabis company. The company offers both adult-use and medical cannabis. Its line of products include dried flower, marijuana powder, cannabis oil, and cannabis-infused beverages. On Sept. 1, HEXO announced the completion of a previously-announced acquisition, valued at about $50 million, in which it bought all of the issued and outstanding shares of 48North, a Canada-based licensed cannabis producer. Each former shareholder of 48North received 0.02366 of a common share of HEXO stock per share of 48North.
• Village Farms International Inc.: Village Farms International is a Canada-based agricultural producer. In addition to growing vegetables such as tomatoes, bell peppers, and cucumbers, the company now also produces cannabis.
• Hydrofarm Holdings Group Inc.: Hydrofarm Holdings Group manufactures and distributes hydroponics products, including lighting equipment, climate control devices, garden accessories, and related products.

These are the marijuana stocks on the Nasdaq with the highest year-over-year (YOY) sales growth for the most recent quarter. Rising sales can help investors to identify companies that are able to grow revenue organically or through other means, and to find growing companies that have not yet reached profitability. In addition, earnings per share (EPS) can be significantly influenced by accounting factors that may not reflect the overall strength of the business. However, sales growth can also be potentially misleading about the strength of a business, because growing sales on money-losing businesses can be harmful if the company has no plan to reach profitability.

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• GrowGeneration Corp.: GrowGeneration operates retail hydroponic and organic specialty gardening retail outlets. It offers plant nutrition, farming soils, crops, advanced lighting technology, hydroponic and aquaponic equipment, and more. While GrowGeneration is not a pure-play cannabis company, many of its products are used in cannabis cultivation. The company announced in mid-September the opening of the two largest hydroponic garden centers to serve Los Angeles County in Southern California, the largest hydroponic market in the country. These stores are GrowGeneration’s 11^th and 12^th locations in the region, and both opened on Sept. 24. Combined, the two stores comprise more than 120,000 square feet.
• Cronos Group Inc.: Cronos Group is a Canada-based diversified cannabis company focused on research, technology, and production and distribution of adult-use and medical cannabis products and cannabis oils. In late August, Cronos announced an important milestone in its partnership aimed at producing cultured cannabinoids with cell programming company Ginkgo Bioworks. The companies successfully achieved their productivity goals for cannabigerolic acid (CBGA). Cost-efficient access to the rare cannabis molecule is key to Cronos’ launch of its new CBG products this fall. CBG is a chemical compound derived from the cannabis plant known as the “mother of all cannabinoids” due to its important role in producing related chemicals.
• Village Farms International Inc.: See above for company description. The company reported 70% YOY growth in net sales for its Pure Sunfarms cannabis business and 135% YOY growth in Pure Sunfarms’ Retail Branded Sales in Q2 2021, ended June 30. The quarter was the first that Village Farms was the top-selling licensed producer in Ontario.

These are the marijuana stocks on the Nasdaq that had the highest total return over the last 12 months.

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• Sundial Growers Inc.: Sundial Growers is a Canada-based cannabis producer. The company produces and distributes cannabis for the adult-use and medical market. It offers dried flower cannabis products in various formats, including pre-rolls, oils, capsules, and more. Sundial recently announced the launch of Caviar Cones under its Top Leaf brand. It is the first infused product of its kind to be released in the Canadian cannabis market and strengthens the company’s position in the inhalables products.
• Tilray Inc.: Tilray is a Canada-based company that engages in cannabis research, cultivation, and distribution. It sells various cannabis products, hemp-based foods, and alcoholic beverages.
• OrganiGram Holdings Inc.: OrganiGram Holdings’s wholly owned subsidiary, Organigram Inc., is a Canada-based producer of medical and recreational cannabis. Its major focus is producing indoor-grown cannabis.

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