Imagine that it’s 1934. The 21st amendment was just ratified last December, repealing the highly unpopular 18th amendment. Prohibition has ended.
Wouldn’t it have been nice to own shares of Anheuser-Busch back then, which over the next 20 years would become the largest brewer in the United States?
How about owning shares of the Coors Brewing Company?
Well now there’s an opportunity to own the Anheuser-Busch or the Coors of the future. As most people know, thousands of investors are piling into a fast emerging industry still at ground zero: the marijuana industry.
Not long ago, the very thought of investing in marijuana stocks would have been a fool’s dream. Now, it’s a reality. And just like alcohol stocks after Prohibition ended, marijuana stocks are now having their watershed moment.
Legalized marijuana is still in its infancy but the business is booming. And although the marijuana industry tends to experience bouts of instability, there are still some marijuana stocks that are worth investing in.
Here are some of the best marijuana stocks to buy right now:
Biotech company GW Pharmaceuticals, headquartered in the United Kingdom, is a marijuana stock that has gained attention for its marijuana-based antiepileptic drug Epidiolex. So far the drug is a success: patients have reported experiencing 39% fewer seizures than before, which all but confirms the effectiveness of cannabinoids (the chemical compounds found in marijuana).
Moreover, the FDA gave GW Pharmaceuticals a seven-year exclusive right to use Epidiolex for treatment of tuberous sclerosis complex (TSC), a rare disorder known to cause many cases of epilepsy. This is known as “orphan status“, or a right given certain drugs to treat rare diseases. Another of its cannabis-based drugs, Sativex, was approved for use in the treatment of cancer and multiple sclerosis in New Zealand and in Europe.
With plenty of cash on hand and almost zero debt, GW is poised to increase investments in more research and development, leading experts to predict a rise in this marijuana stock’s market value.
A leading marijuana stock marketing a marijuana-based drug called Marinol, AbbVie, Inc. is a pharmaceutical firm that has reported rising revenues four years straight. That’s not to mention its operating income, which has climbed continuously.
Marinol, which has been approved by the FDA, helps stem nausea and vomiting in chemotherapy patients, as well as stimulate hunger in those with AIDS. Marinol, however, isn’t considered remarkable in terms of the earnings it’s bringing in. In fact, it’s not one of its top-selling drugs. AbbVie has been making money from a slew of different drugs – and Marinol is only one of them.
Unlike most other pharmaceutical companies, AbbVie concentrates almost solely on the U.S. market. And that can be risky since this marijuana stock’s price depends solely on its drugs’ domestic values.
Despite its so-so track record over the previous three years and a sharp nosedive in operating income toward the beginning of 2017, INSYS Therapeutics has been at work on a new synthetic cannabis drug to treat juvenile epilepsy. It also kicked off another marijuana-based product called Syndros to help with chemotherapy-induced nausea and AIDS-related weight loss.
While it markets many non-marijuana drugs, INSYS has been in a financial slump for three years now and its operating income made a sharp decline by the end of 2016 (though its gross profit is higher than the three years previous). The company has faced its share of legal problems. The Arizona state attorney recently sued INSYS for fraud in connection with a marketing campaign it launched for Subsys, a pain-killing opioid.
This marijuana stock has seen a lot of volatility, which is normal since it is biotech stock. Those problems aside, experts predict this marijuana stock will outpace the marijuana industry’s anticipated growth of 26% with 28% annual earnings growth over the next five years.
This marijuana stock, based out of Maryville, Ohio, sells lawn and garden products. Now it’s entering the pesticide business, developing a line of pesticides for marijuana plants. It’s also coming out with a string of products for people growing their own hemp.
The company has, in fact, spent millions acquiring other marijuana companies. Whereas the marijuana market has traditionally exercised caution when marketing to the general public, Black Magic (Scotts’ hydroponics product that promotes soil-less plant growth) has found its way into 165 Home Depot stores.
A Vancouver-based company, Aurora Cannabis manufactures and distributes marijuana products consisting of cannabis oil and dried cannabis. Cannabis oils are more expensive than the traditional marijuana buds, a fact that has helped boost the company’s profits.
One of the most successful marijuana stocks of 2017, Aurora Cannabis recently launched a line of edible marijuana products, and is working hard to establish itself as a fixture in the European marijuana market. In fact, Aurora Cannabis acquired German medical marijuana market leader Pedanios GmbH this past March.
Aurora has also been constructing a greenhouse in Calgary. This marijuana stock has even extended its reach into Australia, where it took a 20% stake in the country’s first and biggest medical marijuana company.
For more on how to invest in marijuana stocks and the best marijuana stocks to buy right now, check out the following books. And for more unique industry ideas to invest in, take a read through our article: How to Invest in Water Like Dr. Michael Burry from the Big Short.