New York Wants To Legalize Cannabis in 2019

New York is on the fast track to becoming the second largest recreational cannabis market in the United States. Today I am going to reveal two promising young cannabis companies operating in New York that are in position to benefit.

New York governor Andrew Cuomo revealed some big news in late December when he announced that legalizing recreational cannabis would be one of his top priorities in 2019.

Here are some more details from the New York Times.

Gov. Andrew M. Cuomo announced that he would push to legalize recreational marijuana next year, a move that could generate more than $1.7 billion in sales annually and put New York in line with several neighboring states. The highly anticipated proposal came in a speech in Manhattan on Monday, in which the governor outlined his agenda for the first 100 days of his third term.

This is big news for the US cannabis industry. If New York achieves its goal – that’s what I expect – it would almost instantly make the state one of the largest cannabis markets in the country.

The New York comptroller released a study in May that predicted New York cannabis market would grow into a $3.1 billion annual industry.

This is creating another great investment opportunity. With billions set to flow through New York’s cannabis market every year, cannabis companies are scrambling to cash in. Continue reading "New York Wants To Legalize Cannabis in 2019"

3 Reasons Why You Should Still Avoid MJ, The Marijuana ETF

2018 was a tough year for long-term buy and hold marijuana investors. As a whole, the industry went on quite a wild roller-coaster ride. Marijuana stocks popped in December 2017 as anticipation for the ‘legalization’ of the drug occurred in the state of California on January 1st, 2018. We saw stock prices and the ETFMG Alternative Harvest ETF (MJ) jump as investors anticipated a ‘boom’ for the industry.

But, within a month or so of the legalization date, most of the marijuana-related stocks have fallen in price and MJ was trading below its December 2017 price. A few months went by, and most of the industries stocks just meandered along. Then the next big ‘legalization’ date grew near, October 17th, 2018, the day marijuana became legal in Canada.

The price of most of the well known and many of the lesser-known marijuana stocks, and MJ of course, once again began to ski-rocket. MJ, for example, went from $24 per share in August 2018, to as high as $45 per share, with its peak occurring just days before October 17.

Each time a new State or large country legalizes the drug, the companies in the industry experience an unfound increase in their valuation as investors buy shares at an insanely high rate. This type irrational buying leading up to a hyped up, essentially arbitrary date has put a lot of investors in a really bad place in 2018. MJ for one is down more than 24% in 2018, while other individual marijuana companies have seen their stock prices fall even further. Continue reading "3 Reasons Why You Should Still Avoid MJ, The Marijuana ETF"

Marlboro Maker Invests $1.7 Billion in Cannabis

The cannabis industry announced a groundbreaking $1.7 billion megadeal with big tobacco that has the sector on the upswing last week.

Marlboro maker Altria Group (MO), one of the largest tobacco companies in the world, announced a $1.7 billion investment in Cronos Group (CRON), one of Canada’s largest cannabis companies.

Here are some more details from Bloomberg.

Altria has agreed to take a 45 percent stake in Toronto-based marijuana producer Cronos Group Inc., marking a major tobacco company’s first foray into cannabis. It has the option to take majority control in the future.

With U.S. smoking rates falling fast, Richmond, Virginia-based Altria is under pressure to find new avenues to expand. Marijuana is now allowed in an increasing number of states but is still illegal on the federal level in the U.S. That makes Canada, which legalized recreational use in October, a large laboratory for the nascent industry.

“We believe cannabis is an excellent strategic fit for tobacco,” Jefferies analyst Owen Bennett said in a research note earlier this week. It’s a logical fit, because “big tobacco knows how to cultivate crop, knows how to deal with regulators, they are at the forefront of vaporization technology, and they also arguably have less reputational risk than other fast-moving consumer goods,” he said.

The good news gave Cronos a nice boost – shares jumped 25% and settled just shy of the 52-week high. Continue reading "Marlboro Maker Invests $1.7 Billion in Cannabis"

Chicago Ready To Legalize Cannabis

Chicago just took a big step toward becoming the cannabis capital of the Midwest. Not only would that be good for the broader US cannabis industry – it would be great news for two young and promising cannabis companies operating a string of cultivation facilities and dispensaries all across Chicago and Illinois.

The catalyst for Chicago’s cannabis potential? Governor-Elect JB Pritzker.

Pritzker is a major advocate of legalization. It was a staple of his campaign and now that he has won Pritzker says his goal is to legalize recreational cannabis as quickly as possible.

According to a recent report from the Chicago Tribune, Illinois legislators are expected to introduce a bill as early as January that could be passed by May.

Sponsors plan to introduce a new legalization bill in January and hope to get it passed before the session ends in May. The proposed measure would allow the commercial sale and regulation of marijuana, similar to alcohol, for adults 21 and over. There would probably be a six-month waiting period for officials to draw up rules before issuing licenses for growing and selling it. Sponsors say existing medical marijuana companies would likely get the first crack at sales.

Illinois already has a booming medical cannabis industry. Continue reading "Chicago Ready To Legalize Cannabis"

Farm Bill Could Unleash $1 Billion In US Hemp Sales

The US hemp industry is on the verge of a groundbreaking legal victory. Powerful politicians are about to open the floodgates for billions in new sales to flow into the hemp industry in the next few years with a controversial piece of legislation.

This potential legal breakthrough is the perfect catalyst for a promising young US cannabis company that is an early leader in the high-growth hemp and CBD markets.

US hemp
Picture from ministryofhemp.com

However – hemp’s seemingly supernatural powers have plenty of applications.

The total sales for the U.S. Hemp Industry in 2017 were $820mm. $190mm were for Hemp-Derived CBD products, $181mm were for personal care products and $137mm were for hemp food products. Food sales were led by the Snack Food category and Industrial Product sales were led by the Automotive category.

US hemp

Despite all of these applications, hemp is still classified as a Schedule 1(I) drug by the Federal Government. That classification has significantly stunted the growth of the US hemp industry.

That could all change as early as this week. Continue reading "Farm Bill Could Unleash $1 Billion In US Hemp Sales"