Marijuana Stocks to Watch for 2019

2019 will be a good year for Marijuana growers and the Marijuana market at large.  Consumer spending may increase by close to 40% and revenue expected will most likely break the ceilings. Projected total revenue is $18.1 billion. It is also likely that banking which has been a big hindrance in the Marijuana Industry especially in the US will improve with the ease n restrictions.

Industry Trends

Canada was the first country to legalize recreational weed.  The Country has witnessed the biggest gains in the last few years with stocks such as Aphria and Canopy growth delivering investor gains of up to 3000%. Even though more growth is expected, the year will most likely be humbling for marijuana stocks in Canada.

In the United States, a farm bill legalizing cannabis and Hemp-based products was signed into law in 2018. Thanks to these developments, all indications are that the US is where the biggest gains will be in 2019. As the pot market comes to the limelight after being in the shadows for centuries, it is certain that marijuana cultivation will become more widespread in the states and in other parts of the world. More marijuana-related products ranging from oil to shatter weed will be available in higher amounts in response to customer demands.

Below are the marijuana stocks to watch for in 2019:

GW Pharmaceuticals

This company is dedicated to developing and commercializing prescription medicine made of cannabinoid.  A cannabinoid is a cannabis plant extract. Among its inventions is the drug Epidiolex that became the first cannabis-derived drug to receive FDA approval.

GW Pharmaceuticals sales are expected to increase in 2019 and in the next few years.  Currently, this Company comes second in the Zacks Rank (Buy) stock. So far, the Company has outperformed the Medical Products industry with a gain of 56.5% compared to the 9.4% gain in the medical products industry. The estimated gain for the next quarter stands at 5.13%, and things will most likely get better in the next few years.

Curaleaf Holdings

Curaleaf currently operates 42 stores and this number is expected to increase to 111 stores by the end of the year 2019.  Aside from operating retail stores, Curaleaf has 12 marijuana growing locations where most of the stocks in the stores are grown. This is in addition to 10 operating facilities. 

The bulk of Curaleaf Revenue came from the sale of medical Marijuana. With the legalization of recreational Marijuana, it is certain that gross margins will respond positively. Investors should be keen to see the impact recreational sales will have on revenue. Another thing to watch is the effect that expansion will have on the income statement.

Innovative Industrial Properties

Yet another Company with#2 Buy on Zacks Rank. This Company focuses on ownership, acquisition, and management of medical use cannabis industries leased to licensed and experienced operators.

With the recent changes in the cannabis industry in the US, it is safe to say that Innovative Industrial Properties has enough motivation to acquire more properties. Earnings from stocks could grow by 64.2%, and the trend is likely to continue for the next few years.

Medmen Enterprises

Medmen is expected to be the biggest retailer in the marijuana industry. Being one among the first American Companies to list in the stock exchange in Canada, this Company remains as a top contender in this industry.  Currently, Medmen operates 9 stores in California and a total of 20 dispensaries spread across 5 states. The Company is also in the process of acquiring PharmaCann, and this can only translate to increased revenue. If everything goes as planned, the Company will be operating 30 stores with possibilities of opening close to 80 more stores in 12 states.

Preliminary reports released early in the year show that revenue increased by 40 % in the past quarter. Revenue for the existing stores and the stores Medmen is acquiring was $50 million in the past quarter. Going by the trend, the revenue generated by the Company is anticipated to increase in 2019.

Even though Medmen comes with an impressive portfolio, its expansion only means that the Company cannot offer profits to investors just yet.  It appears that the Company wants to create a foothold in the market first. Given the fact that cannabis is still illegal at the federal level, opening stores in different states is a smart move. This takes care of trading restrictions considering that transporting marijuana across state lines is illegal.

KushCo Holdings

This is a creative design agency targeting cannabis and non-cannabis clients. The Company that started as a supplies and packaging Company in 2010 has witnessed huge growth over the years. Today, the Company works as an agency whose primary role is to provide marketing, brand strategy, and e-commerce solutions to its clients.

KushCo Holdings comes with an impressive portfolio. The Company has facilities in 3 of the largest Cannabis Markets in the US. Recently, KushCo acquired Summit Innovations, a hydrocarbon gases manufacturing firm. These gases are used to convert cannabis plants into oils. Considering the rate at which people are using CBD vape juice for anxiety, it is no wonder that oils generate more profits when compared to the dried flower.

Since January 2019, KushCo Holdings has gained over 14%.  Even though the Company does not directly touch cannabis, it is probable that in the next one year, the annual earnings could grow by up to 100%. It is, therefore, safe to say that KushCo is the best ancillary play In the Marijuana market today.

Conclusion

While things in the stock market can change fast, the above stocks will most likely go up within the year. It will take strong branding among other factors for the above Companies to remain at the top in a highly competitive market. That said it is obvious that this is a good time to invest in the above and other well-performing companies. There is a high chance of making some good money in this industry in the near future. It is important to remember that in 2019, most of the Companies will concentrate more on expansion as they await more regulatory dominoes.