During the last six months or so, we saw a massive downtrend with the majority of the largest marijuana stocks in the industry. These companies participate in various sectors of the market including cannabis growth, alternative product production and more. One thing that has served to contribute to the large downtrend seems to be the infancy of the industry overall. Because the current state of the pot stock market has only existed for a few years, right now investing in cannabis can seem like the wild west. This means that prices shoot up and down and a large amount of news is entering the market.
Interestingly enough, volatility is often something that some investors seek out as it gives them the potential to make large short term gains. On the other hand, it can also lead to the possibility of large losses as well. With this in mind, the marijuana stocks that are at the top of the market do have a purpose. With cannabis production running in the hundreds of thousands of kilograms per year, it seems as though the behemoths are here to stay. But, one can only wonder as to what will happen with these select businesses if the market continues to shift.
Is This High Price Marijuana Stock Worth It?
Tilray (TLRY Stock Report) is a very disappointing pot stock to bring up for some investors. The company lost almost $5 billion in its market cap during the 2019 year. This is quite a large amount of money and something that will plague the future of the business for quite some time. One of the major reasons for this, however, stands in the hand of those very investors.
Prior to the legalization of cannabis in Canada, we saw a massive overvaluing of the largest companies in the industry. Much of the pot stock market devolved to betting rather than to invest in the future of a company. This ended up taking Tilray’s price to as high as $300 per share. With that as a clearly unsustainable number, the company has since been attempting to find its true value. With some volatility definitely in the future, Tilray is an interesting pot stock to watch, but maybe just for research purposes.
The Rise And Fall Of Another Marijuana Stock
Canopy Growth (CGC Stock Report) is another one of the largest pot stocks in the industry, if not the largest by market cap. During the 2019 year, the company shed off as much as $2 billion in value. This is also quite a substantial number, albeit not as large as Tilray. The company did see quite a large amount of issues regarding supply worries in Canada. This, however, is not the culprit of Canopy’s large failure of the year.
The company wound end spending quite a large amount of money on various acquisitions and nonsensical purchases. This spending spree wound up angering investors and has since helped to only bring more negativity to its pricing. But, as the future goes on, Canopy could have potential due mostly to its size and market share. But, it all depends on whether or not the company is able to begin making wiser business decisions.
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