It wasn’t long ago when investing in marijuana meant giving your buddy money for seeds, grow lamps, and bail money for when he would inevitably get caught with weed and go to jail. Times are different now.
8 states have legalized the use of recreational medical marijuana while 28 states have legalized the use of medical marijuana. The change of opinion by the general public regarding marijuana and the level of social acceptability has also created a profit opportunity.
It is difficult to argue with the growth rate of MJ stocks over the last few years. Marijuana penny stocks have seen some of the highest growth rates of any stocks in recent history and we don’t see that growth slowing down any time soon. In fact, some of the best marijuana stocks to buy have been lower priced cannabis penny stocks over the past couple years.
Below are the top 10 pot stocks to watch that have the potential to double or triple in 2017. As medical marijuana continues to become more accepted and legalized around the country, medical MJ stocks will continue to gain popularity and recognition from the rest of the stock market.
Why People are Investing in Marijuana Stocks
The next gold rush will get its investors higher than the pot that is creating the opportunity for the profits. This new medical marijuana market could be worth upwards of $21 billion by 2020 according to some estimates. Do you have your favorite marijuana penny stocks picked out yet?
The process of selecting the best cannabis stocks to invest in starts with doing some research on the current state of affairs for this delectable marketplace. Colorado was the first state to legalize recreational marijuana and sales for the fiscal year ending June, 30th 2016 exceeded $1 billion for the first time in US history. The growth of Colorado’s medical marijuana and recreational marijuana is projected to more than double by 2020.
Market experts differ regarding projections for growth in the marijuana market as well as which are the best stocks to buy in the marijuana niche. The one thing they all agree on is that the marijuana market is a multi-billion dollar titan of growth that has not been seen in the stock market for years. Some advisors, including Matt Karnes from GreenWave, estimate the compound annual growth rate for the marijuana sector to be pushing 35% by the year 2020.
35% per year is an incredible projection, but this doesn’t come close to some other market analysts who are projecting that the market could climb higher than $50 billion in the next 10 years provided that marijuana is legalized on a federal level.
Here’s The Best Marijuana Stocks to Buy Now:
HEMP Stock– This has been one of the most popular and best performing penny stocks since the beginning of the marijuana boom. The company consistently trades millions of shares per day and the stock has been fairly stable for such a low priced stock.
The stock is being held back by a pending court case. If this case gets cleared up or dismissed then HEMP Inc Stock could turn into one of the best marijuana penny stocks to buy in 2017.
ERBB Stock– With Trump’s press secretary stating today they will fight cartels, etc. they are not going to fight medical marijuana. They did not mention Medical MJ Stocks as a negative and the additional revenue that California and Washington have seen in the past year this will go up by this summer. ERBB will benefit greatly as more states add this cash flow source to their bottom line.
They will need state of the art dispensaries such as American Green very shortly. We will see a .50 price by summer maybe only on hype at first then it will go down to the low .20’s before going back up higher.
CBIS Stock– Let’s not forget that the short interest has tripled to 9 1/2 million shares and may continue increasing. This is becoming a compressed spring and when it releases will bounce VERY high!
All these shorties think they’re so smart but will all become scared rats jumping ship when CBIS shows to be undeniably moving toward revenues, patents and cures! That’s when they will all be covering their short shares and driving the price to levels unseen for years!
CBDS Stock– Very Impressive board of directors and management team. CBDS stock has moved from under $2 per share to over $9 per share over the last 6 months. This is an impressive move for the stock and the fundamentals of the stock are also improving dramatically. The chart has formed a very solid uptrend and this may be one of the safest long term marijuana stocks to invest in.
MJNA Stock– Incredible results announced in pediatric seizure study conducted in Mexico. MJNA is setting the global standard for this type of seizure treatment. The market for anti convulsive drugs is massive and this little MJ company could become a major player alongside stocks that are trading at $50-$100 per share.
MCIG Stock– 446% increase in revenue last quarter. The anticipation of increased earnings growth before next quarter could produce a nice rally until then. The new Oregon grow facility should reflect positively on the share price as well. It should be in the .40s although it has to consolidate for awhile, which is healthy for a stock.
Everyone one is cheering for the increase in revenue but the real story is the net income (Income from operations 191,178 vs -48,160 ). This number is key to how well MCIG is doing. Actual return to the shareholders is huge. If this number can continue to stay positive and increase, you will see a huge run up in stock price and will justify the market capitalization.
MYHI Stock– This company is focused on the commercial hemp and Cannabidiol products industries. The Company is a real estate investment firm whose primary focus was to hold, develop and manage real property. The Company focuses on acquiring and equipping commercial facilities to be leased to and utilized by the commercial marijuana industry in Colorado.
VPOR Stock– This company has a very solid footing in the MJ industry. The fundamentals of the company are constantly improving and the stock chart looks very good right now. The chart is trending very near its trend line that has provided solid support in the past. Good swing trade candidate from here.
Investing in Marijuana Penny Stocks
Risks to the Marijuana Market
The marijuana industry has been on a crazy ride ripping higher over the past couple years. Marijuana penny stocks have seen amazing gains that are only comparable to the dot com gold rush back in the early 2,000’s. As we said before, industry analysts are predicting this growth trend to continue over the next decade. The marijuana penny stock market is not without risk, however. Below are a couple reasons to be careful with your portfolio investments. Don’t forget to lock in some penny stock gains with these picks as they fly higher!
Pot Stocks Can’t Get Bank Accounts
Financial institutions ultimately answer to the US government when it comes to their clientele. As of this writing marijuana is still an illegal substance according to federal law. This means that sells marijuana is technically in violation of federal law which would prohibit them from the ability to open a bank account. Marijuana companies are forced to deal with straight cash homie and that can be a problem.
Cannabis Stocks Can’t Take Normal Tax Deductions
This is a bit of a piggy back on the last negative item here. Due to the fact that these marijuana companies are selling an illegal product in the eyes of the federal government they no longer qualify for the standard tax deductions that businesses who do not sell drugs qualify for. Uncle Sam is like that friend who brought 3 Zimas to the party and left when the music got too loud.
Even the Best Pot Stocks Are Losing Money
This industry is very young and a lot of these stocks are valued based on the hype of future revenue and not the current state of their cash flow. This is no different than the tech boom of the early 2,000’s. We saw what happened there….some companies figured it out and became titans of industry while others left the market when the music got too loud. Even the largest marijuana stock of all, GW Pharmaceuticals (NASDAQ:GWPH) has a fantastic drug called Epidiolex which is intended to reduce the frequency of seizures in children, but won’t see profitability for years to come.
Most Pot Stocks Are Penny Stocks
Now…this is not necessarily a negative thing. We just need to understand what we are dealing with. There are some stocks that are meant to be invested in and some that are meant to be traded. If you confused these two things you may end up losing your shirt and possibly more.
Jeff Sessions is Not a Fan
This may be the most crucial aspect of the marijuana penny stock debate. Jeff Sessions is not a fan of the medical marijuana industry and we will need to wait and see how much of a stance he takes against weed stocks. There is a lot of momentum on the side of legalization at the moment so if you are a cannabis stock investor there is no need to panic. Stay alert and make sure you have your trade plan in place.