The Growing Cannabis Industry In 2021
The cannabis industry and marijuana stocks have many positive things occurring for it in 2021. For one there is a strong possibility this could be the year of federal cannabis reform in the United States. At the current time, the majority of the U.S. has established some form of cannabis legalization on the state level. In addition, the global acceptance of the medicinal capability of cannabis has been established by the U.N in a recent vote. In essence, many signs point to an increase in market size for the marijuana industry.
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By the end of 2020 marijuana companies were reporting substantial revenue increases due to consumer demand. As a result, many U.S. cannabis stocks to watch saw gains in the market and continue to show upward potential. In fact, most marijuana stocks have seen modest gains in the first trading day of 2021 as the rest of the market has a pullback by midday trading. As it stands many investors are beginning to incorporate cannabis investing into their portfolios. But with so many different choices which are the best marijuana stocks to buy for 2021 gains? In general, there are a few ways to narrow down the best pot stocks for you to invest in.
Cannabis Companies And The Mergers and Acquisitions of 2020
For one making sure you become familiar with a company’s financials and balance sheet can help investors gauge the possibilities of them having growth potential for the future. While rapid growth seems to be occurring in the U.S. the well-positioned cannabis companies will provide the best returns for investors. In 2020 we began to see an increase in mergers and acquisitions that will most likely continue into this year. In essence, this is because top cannabis companies are attempting to capitalize off the growing market share in key states. Considering many analysts predict substantial growth for the cannabis industry in the next five years companies are expanding their footprint in the market.
At the present time, there have been some newly established acquisitions that have garnered investor interest. In general, these developments show how different companies are moving into new markets as the cannabis industry landscape continues to transform. With the intention of looking into some recent transitions in the industry let’s take a look at 2 marijuana stocks to watch this week in the market.
Marijuana Stock To Buy {or Sell}: Ayr Strategies Inc.
Ayr Strategies Inc. (AYRWF Stock Report) is an expanding vertically integrated, U.S. multi-state cannabis operator, focusing on high-growth markets. Recently the company has made a handful of acquisitions at the end of 2020. In detail its last acquisition announcement on December 23rd with the purchase of CannTech PA for $57.4 million. This would mean $27.2 million in cash and the rest in shares and seller’s notes. In reality, the acquisition moves Ayr into the Pennsylvania cannabis market with a 143,000 sq. ft cultivation and processing facility on 13 acres. In addition, CannTech’s license also permits up to six dispensary locations in Pennsylvania.
One day earlier on December 22nd Ayr announced its proposed acquisition of Liberty Health Sciences Inc. for the stock for a stock transaction value of $290 million. On top of that, they announced the proposed proposition to acquire a membership interest in GSD NJ LLC a licensed operator in New Jersey for $101 million. In essence, these acquisitions will give Ayr a presence in seven states four being adult recreational markets. To elaborate Ayr is a market leader in the wholesale and medical sales market in Massachusetts and is establishing its footprint in Arizona, and New Jersey. This comes at a time both states are rolling out adult-use markets for the first time. But since its largest acquisition is for Liberty Health let’s take a look into how this merger positions both companies.
Marijuana Stock To Buy {or Sell}: Liberty Health Sciences Inc.
At the current time, Liberty Health Sciences Inc. (LHSIF Stock Report) has opened its 28th dispensary and has plans to open an additional 14 more in 2021. In fact, that makes 42 locations within the state of Florida giving the company a massive footprint in the state. In addition, the assets acquired by Ayr from Liberty include a 387-acre cultivation site in Gainesville, Fl. Currently, there are over 300,000 sq. ft. of the production facility in operation. Also, Liberty currently has 335 employees that are expected to be retained by Ayr.
LHSIF stock almost doubled on the news of the acquisition and is currently trading around $0.802 on January 4th. With the support provided by Ayr, Liberty dispensaries could be a major market shareholder in Florida. Currently, the moves Ayr has established will position it amongst some of the larger U.S cannabis companies.
AYRWF stock is up 4.29% in the market today currently trading at $24.80 a share. As it stands AYRWF stock has provided gains for investors in 2020. Asa company Ayr seems to be making the necessary moves to expand into key markets with growth potential. For this reason, AYRWF stock and LHSIF stock are pot stocks to watch the first week of January.
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