Are you looking for a healthy return on capital by cashing in on the marijuana stocks? With numerous medical benefits slowly unlocking, we can see the growth potential from these stocks.
Their recent medical potential mandates you to keep an eye on the top medical marijuana stocks, which you must not miss! Having these stocks in the portfolio can help you gain handsome gains within a short span of time.
If you are still wondering about how to invest in marijuana stocks, this article will help you know the best picks for 2021!
We have done the research for you!
All you need to do is decide which is the best pick!
So, without further ado, let us look into the top 10 marijuana stocks, that you must not miss in 2021.
Found Year: 1998
Market Value: $2.8 Bn
Plant-based CBD products are what GW Pharmaceuticals is known for.
Being the frontrunner in the manufacturing of CBD derived therapeutic by releasing Epidiolex for children, GW Pharmaceuticals has etched a name in the CBD based medicines.
Though the financials of the company had been going through a purple patch, the silver lining is the revenue growth. The growth in revenue from $10 bn in 2017 to a whopping $440 bn in June 2020 is a positive sign for the investors.
On the downside, the growing expenses have made the bottom line red, though the losses have shrunk over time.
With the losses shrinking from $29 mn to a meager $9 mn, things are looking bright for GW Pharmaceuticals.
What’s more interesting to note is the pipeline of products.
With the recent approval of Epidiolex’s oral solution for treating TBS, we are sure it can turn out to be one of the top marijuana stocks, in the battle against seizures.
Found Year: 2013
Market Value: $10 Bn
With the strong numbers and the robust product line, canopy growth has proven its mettle in the CBD market.
Canopy Growth boasts of the immense market valuation. Followed by the strong industrial backing from alcohol giant, Constellation Brands, it is poised to be the giant in the CBD market.
We have seen the tumultuous numbers over the past few years with Canopy Growth, yet the success the brand has achieved is phenomenal.
With the recent launch of stand-alone websites for selling CBD products, it has made a giant leap into becoming the global leader in CBD based products.
The future for Canopy can only be brighter from here on! Let us sit tight and invest to ride the profit roller coaster with this mega-CBD brand!
Found Year: 1985
Market Value: $75.77 Bn
Altria, with close to 40% of the shareholding in the largest Canadian marijuana company, Cronos Group, is set to start its up move again!
With the recent election of Joe Biden as the US President, the decriminalization of cannabis is on the cards.
With Altria looking forward to taking major control over Cronos by holding more than 50% of the seats on the board, Altria is repositioning itself into a marijuana firm.
The past has seen Altria suffer a lot in terms of financial positions, with the stock plummeting consistently over the past 5 years. Including the massive 9% discount, the loss from the stock comes close to 3.6%, which is not attractive.
Moreover, with their recent venture in Juul Labs, it faced cumulative write-downs of close to $9 bn within 6 months.
Found Year: 2014
Market Value: $4.93 Bn
A very young runner in the cannabis market, Aphria can take the benefit of the soaring marijuana stock price, as it seems pretty undervalued.
Currently trading around $16, the company has been ignored by many, yet it has posted some really encouraging results.
With the modest losses being close to C$5.1 million in the first 3 months of FY 21, it has beaten the analyst’s view by 50%.
Aphria is a must-have stock on your portfolio being close to 16% growth in the Y-on-Y revenues and higher efficiency as reflected by the cost of sales.
With the change in the operations enabling it to increase the market penetration, it has started the price war against the big fish!
Don’t miss this multi-bagger with 11 out of 13 analysts bullish on this stock!
Green Thumb Industries Inc
Found Year: 2002
Market Value: $8.20 Bn
The fall of the GTII is a behemoth, and it cannot be denied.
With the losses accounting for more than 60% over the last 5 years, GTII is trading at 7.04X the PB ratio, thus making it more than 150% over-value stock.
With the negative PE ratio of the company, compared to the industry PE ratio of 43.6X, numbers don’t seem that bright for GTII.
On the positive side, with the marijuana market opening up, the sector is supposed to see a positive growth of 60.8%, which is 2X the market growth.
With the positive sectoral growth, GTII can see a growth close to 100% of its current stock price, which makes it a strong contender in this sector!
Analysts have been pretty bullish in GTII in terms of the EPS. Even though the current EPS is negative, with the opening up of the marijuana sector, GTII can see a four-fold growth in the EPS by 2023.
With the ROCE turning positive last year, things are looking bright for GTII to invest into!
Innovative Industrial Properties
Found Year: 2016
Market Value: $4.66 Bn
At a time when the Cannabis industry was just too young, compared to its peers like alcohol or tobacco, IIPR emerged as a REIT. With the strong growth over the last couple of years, gaining more than 150%, this stock is one of the strongest picks.
Back in 2018, with just 9 properties, it started leasing for medical marijuana production.
In two years, the growth in the properties has been 6X, which has grown at an accelerating pace during the first half of FY 20.
The financial health of the stock is highly positive, along with a strong orientation towards future contributions.
With the projected earnings to cross $200 mn by 2023, the stock is still undervalued compared to its industry peers.
The strong earnings in the past backed by the lucrative valuation of the stock make it a must-have in the portfolio for 2021.
Found Year: 1868
Market Value: $12.66 Bn
With the ecstatic growth in the Hawthrone division, by a huge 72%, SMG has made the best returns from COVID19.
As WFH became the norm, home gardening started to make its way into our lives.
It resulted in the growth of more than 20% in the garden products of SMG, which constitutes close to 70% of their sales.
Hawthorne, with its expertise in hydroponics production distribution, has seen a tremendous demand owing to its property of growing plants without soil.
These products are integral to the growth of cannabis, which makes it a direct beneficiary of the legalization of marijuana.
With the earnings looking brighter, at a rate of more than 10%, SMG stands a very good chance to give you a 15-20% return within a year.
With the PE ratio being equivalent to the PE ratio of the US Chemicals sector, SMG seems to be slightly overvalued.
Yet, with the long term assets of over $2 bn and a very healthy current ratio, SMG seems to be a healthy pick during the booming marijuana market’s growth!
Found Year: 1945
Market Value: $41.06 Bn
If any brand got the highest limelight due to COVID19, it has to Constellation Brands, with their product line of Corona Beverages.
Investing in Constellation Brands might be the safest bet if you are a risk-averse investor. With the diversification across 4 different sectors, it has mitigated the risk!
In 2017, it brought close to a 10% stake in CGC. 2018 saw the brand increase its stake by close to 4 times by investing 4 billion into CGC.
Thus, creating the fourth revenue stream!
With exercisable warrants giving the brand close to 55% ownership in CGC, if exercised, Constellation Brands has strategically diversified its business.
The stock price of CGC has been suffering lately, which resulted in moderate numbers for STZ as well.
Yet, there is no less reason to like STZ.
Especially with the expansion into the brandy line of products by acquiring Copper & Kings, the portfolio of STZ has grown even bigger!
Found Year: 2012
Market Value: $4.69 Bn
Enjoying the deep pockets of Altria, Cronos has started to make global expansion.
With the recent entry into the Israeli medicinal market, Cronos has made its intentions clear; i.e. growth!
And, it is absolutely possible, after it has posted a stupendous revenue growth!
180% Y-o-Y revenue growth, during the pandemic!
The snowflake model shows very positive health for the company, along with the financials forecasting a revenue growth by 5 times in 2025.
The yearly returns from CRONOS close to 40% and the undervaluation of the stock make it a perfect buy!
The PE ratio of CRONOS is close to 36X, which is 10X less when compared with the industry.
Supportive PB ratios, with strong industry growth forecasts, make this a very positive buy in the marijuana sector!
A firm, which is solely into the cannabis industry, is Curaleaf Holdings. The Massacheutus based firm has one inspirational medical story for every entrepreneur!
Today, with a huge empire across the US, it has kept customer satisfaction as its prime objective.
Its nascent beginnings in medicinal marijuana is slowly taking the recreational direction. With the change in the target consumers to the adults, CURLF is looking to make the best use of its vertical integration!
With marijuana getting legalized across states for recreational purposes, CURLF could just turn out to be the dark horse.
Starting from the strategic positioning to the infrastructural support, everything is in favor of CURLF. With more than 14 acquisitions since the IPO, CURLF is on an expansion spree.
With a swashbuckling result for five straight quarters, scoring straight positive EBIT, it has inched closer to greener figures using the GAAP principles.
Betting against marijuana? Don’t miss CURLF.
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