Last Updated on Dec 20, 2019 by James W
The marijuana business is estimated to be worth at least $10 billion. By all means, this is a lucrative market if you intend on investing in the stock exchange. However, few people know how to go about investing in stocks such as the MJNA Stock.
This is why we put together this simple guide which will come in handy when searching for a marijuana business in the stock market.
The Suppliers and Growers
This is the first set of stakeholders in marijuana stocks. Of course, you need this group in order to grow and distribute the product. Nevertheless, legal cannabis business is still in its early stages. In Canada, for example, the business came into life after it was legalized in 2001.
In 2017, the Canadian government announced plans to legalize the herb for recreational use. As a result, many companies are looking to reap from this positive mood to handle the product. Canopy Growth is the largest by market capitalization courtesy of numerous acquisitions. In addition, they have a permit to export some of the products.
For the first quarter in 2017, Canopy Growth announced $17.0 million in revenues which represented twice the figure achieved in the same period the previous year.
Other companies in the same space include Aurora Cannabis, MedReleaf and Aphria. While Canopy Growth enjoys a huge market, these three companies also enjoy increasing profits.
The Medical Herb
Certain chemical compounds in cannabis contain medicinal properties. This why bio-tech companies are scrambling for a dose of this herb.
The biggest in the business, GW Pharmaceuticals, a UK based company uses this herb to develop solutions for patients with multiple sclerosis. Keep in mind the company has already received a green light from at least 30 markets.
Corbus Pharmaceuticals Holdings, Cara Therapeutics, Insys Therapeutics, Axim Biotechnologies and Zynerba Pharmaceuticals are some of the companies developing medical products from marijuana.
The final group in the long chain contains companies such as Scotts Miracle-Gro. This company deals with garden and lawn care products. Remember, even marijuana needs a bit of help to grow, especially if it’s grown for commercial purposes.
Apart from Scotts Miracle-Gro, another company, Medical Marijuana Inc also fights for space in this category although it’s a group of marijuana-associated assets.
Cronos Group is the last in this category which is also a set of marijuana-related assets. It owns two other business although small and holds a significant stake in another. The three businesses are sellers and producers.
You can also follow these companies on a preferred stock message board.
The Legal Status
When investing in the marijuana business, the only hurdle to success is the legal status. For example, it’s illegal at the Federal level to possess marijuana. This is despite its legalization for medicinal purposes in 28 states and for recreational purposes in 8.
For this reason, as a stock investor in the marijuana business, you must prepare for the high risks brought about by the legal issues in each country. In fact, the marijuana stock business is riskier than other types of stocks.
