Israel's Bid To Legalize Recreational Cannabis

Israel just took an important step to make it the next country to legalize recreational cannabis. If this happens, two young cannabis stocks could surge.

A bill to legalize recreational cannabis in Israel passed a critical test after being approved by the Ministerial Committee for Legislation.

According to The Times of Israel, this bill would decriminalize possession (up to 50 grams). It would also legalize individual possession of up to 15 grams among opening up other restrictions.

Here are some more details from The Times of Israel.

If the bill becomes law, selling and purchasing marijuana for personal use will be legal for those above 21 and authorized shops will be allowed to sell cannabis product, through growing marijuana at home will still be illegal. The legislation also outlined medical cannabis reform.

On Wednesday, the legislation is expected to be brought before the Knesset for the first of three votes it must clear in order to become a law.

The bill still has to jump a few hurdles, but the outlook is promising. Prime Minister Benjamin Netanyahu has found the leadership support needed for full legalization and has vowed to “resolve the issue of decriminalization and legalization.”

If the bill is passed – it would pave the way for Israel’s medical and recreational industry to flourish. If legalization pushes through, these two stocks are in position to benefit. Continue reading "Israel's Bid To Legalize Recreational Cannabis"

Canopy CEO Predicts U.S. Legalization by 2022

I call it the “holy grail” of the cannabis industry – a game-changing event that would mint the first cannabis billionaire and richly reward early investors.

I’m talking about the federal legalization of cannabis.

Some say it’s still a pipe dream, years away at best. However, the reality is that federal legalization could be right around the corner.

If you don’t believe me, check out what the CEO of the largest cannabis company had to say in an interview with Jim Cramer on Mad Money.

Here’s the clip from CNBC.

David Klein, the head of Canopy Growth, told CNBC’s Jim Cramer on Tuesday that as states continue to gradually permit medical and recreational use of marijuana, Congress will have no choice but to act.

“My assumption is that 2022, for me, is the magic number,” he said in a “Mad Money” interview. “I think, as you watch more and more states move to legalization for medical or rec, you really bring in almost two more senators each time who are really going to feel compelled to not make criminals out of the people in their state who are doing what’s legal in their particular state.”

Why Klein’s Comments Are an Important Signal

#1 – CEOs have an incentive to establish realistic goals that are attainable. It doesn’t do a CEO any good to set expectations really high and then fall short. For Klein to publicly project legalization in 2022, it tells me he knows about things that are happening behind the curtain. I think he’s showing his hand.

#2 – U.S. federal legalization by 2022 is the most optimistic projection that I’ve heard from anyone on Klein’s level.

#3 – As the CEO of Canopy, Klein has access to the best contacts and information in the industry. His opinion about the cannabis industry carries a lot of weight.

Current Events Are Pointing Towards Legalization

COVID-19 just made the case for legalizing cannabis stronger than ever. The U.S. economy shed around 40 million jobs in eight weeks. According to recent reports, many of those jobs are never coming back. Tax revenue has plummeted. Officials are calling it catastrophic. Politicians are desperate for new sources of taxes. Continue reading "Canopy CEO Predicts U.S. Legalization by 2022"

Will Canopy Growth Corp (CGC) Jump 250%?

Aurora Cannabis (ACB) just jumped 250% in two days after reporting third-quarter earnings that crushed expectations.

Not many people saw that huge jump coming. If you missed it – don’t worry.

I see a high probability that the same pattern will repeat itself on Friday morning when the largest cannabis company in the world reports highly anticipated fourth-quarter earnings.

Here’s what you need to know and how to play Friday’s big event.

Aurora Cannabis (ACB) is one of the largest cannabis companies in the world. Shares of ACB jumped 250% in two days last week after reporting third-quarter results that crushed expectations.

Here are some more details from Aurora.

  • Net revenue, excluding provisions, of $78.4 million in Q3 2020 was up 18% quarter over quarter. Cannabis net revenue, excluding provisions, was $72.6 million, up 15% over Q2 2020.
  • Consumer cannabis net revenue, excluding provisions, was up 24% from the prior quarter to $41.5 million, demonstrating the impact of the launch of Daily Special, Aurora’s value brand, and a full quarter of Cannabis 2.0 products. Medical cannabis net revenue, both Canadian and international, showed healthy growth of 13.5% overall.

Aurora Cannabis Announces Fiscal Third Quarter 2020 Results & Operational Reset Update

Canopy Growth Corp

These results send an important and encouraging message to investors – cannabis stocks are shifting into a bullish phase.

In 2019, pot stocks fell short of lofty expectations. Today, the sector is crushing more realistic expectations.

Canopy Growth Corp (CGC) is the largest cannabis company in the world with a market cap of $7 billion and operations on four continents.

Canopy is scheduled to report fourth-quarter results on Friday, May 29, 2020, before the opening bell. Aurora’s impressive results tell me that Canopy is also going to crush expectations.

Here’s why… Continue reading "Will Canopy Growth Corp (CGC) Jump 250%?"

Cannabis Sales Surge On Coronavirus

Coronavirus is having a devastating effect on many industries in the United States and across the globe.

For example, millions of US citizens are canceling travel plans and that is crushing US airline industry revenue. That's why the US airline industry just asked for a $50 billion financial bailout from the federal government that would be three times the size of the airline bailout after September 11.

This big drop in sales is causing a lot of pain for shareholders. Airline stocks have been getting hammered.

United Airlines Holdings Inc. (UAL) is down -60% from the 52-week high, much worse than the S&P 500’s -12% decline from the 52-week high.

UAL

However, not all industries are struggling right now. In fact – some are thriving.

Cannabis sales have been one of the few bright spots while most industries are in a tailspin. Continue reading "Cannabis Sales Surge On Coronavirus"

Can Big Tobacco Ignite This 80% Loser

There are few events that can send a cannabis stock soaring like an investment from big tobacco.

Do you remember what happened on December 7, 2018?

That’s when Altria Group (MO), one of the largest tobacco companies in the world and maker of Marlboro cigarettes, invested $1.8 billion into Cronos Group (CRON), one of the largest cannabis companies in Canada and the world. Investors loved the news, sending shares of Cronos soaring. Cronos proceeded to jump almost 148% in the eight weeks while the rest of the cannabis sector gained 24%. It looks like a similar megadeal is in the works.

Big Tobacco

Auxly Cannabis Group (XLY, CBWTF) is a mid-sized cannabis company headquartered in Canada.

It has a market cap of $380 million and annual cannabis cultivation capacity of 100K kilos.

Auxly has one of the most unique business models in the Canadian cannabis industry – it calls itself a “streaming cannabis company.” Here’s what that means. Auxly is basically a wholesaling, cultivating and selling cannabis to some of the largest retailers in the industry. In order to meet these supply needs, Auxly owns an impressive portfolio of cannabis cultivation facilities that it expects to produce more than 100,000 kilograms in the next 12 months. Continue reading "Can Big Tobacco Ignite This 80% Loser"