Will Top Cannabis Stocks Continue Showing Upside?
For months cannabis investors have waited for further action from Congress to give top marijuana stocks some upside in the market. Now with the announcement of an amendment like the SAFE Banking Act on a defense bill. The best cannabis stocks have seen some upside in the past few days. Going into the weekend the cannabis sector could continue to see upward momentum in the market. At the present time, in the US the cannabis industry has been growing rapidly across the country.
In 2021 many more states legalized cannabis use for medical and recreational purposes. As a result, this has given leading cannabis companies new markets to take advantage of this year. In the first half of 2021 leading cannabis companies are reporting strong revenue growth and an increase in cannabis sales across most of the market. Unfortunately, this has not translated into gains for the best pot stocks.
For instance, in states like Michigan cannabis sales increased by 52% to $165 million in August. Similar market trends can be seen in many markets across America. In truth, not very many investors are currently taking advantage of the industry’s potential in the market. This is because most top cannabis plays trade on the OTC Markets because of current federal policy. For retail investors using new apps like Robinhood Markets, Inc. (NASDAQ:HOOD), or WeBull OTC stocks are not available to trade.
Best US Pot Stocks 2021
The US cannabis companies that are available for retail investors using these trading apps are ancillary cannabis stocks. Ancillary cannabis companies are those companies that support the cannabis industry without touching the actual plant. For example, companies that provide real estate investments for cannabis companies are in the ancillary category. With top marijuana stocks starting to make a move to the upside it could be time to start a list of the best cannabis stocks in 2021.
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For investors, it’s always important to research a company to find the best-performing ones before investing. Researching a company’s financials and studying how a stock moves in the market can help you achieve the best returns on your investment. With cannabis banking reform as a possibility right now we could see more investors showing interest in pot stocks. Let’s look at some top cannabis stocks for your watchlist before next week.
Marijuana Stocks To Watch In 2021
- AFC Gamma, Inc. (NASDAQ:AFCG)
- Ascend Wellness Holdings, Inc. (OTC:AAWH)
AFC Gamma, Inc.
Founded in 2020, AFC Gamma, Inc. is an institutional lender to leading cannabis companies with strong operations and cash-flow prospects. Primarily, the company specializes in real estate security and other collateral, and locations in states with favorable supply/demand fundamentals and legislative environments. In general, AFCG provides innovative and customized financing solutions through first-lien loans, mortgage loans, construction loans, and bridge financings. Overall, AFC Gamma’s principles are now focused on the exponential growth of the cannabis industry. In August, AFC Gamma announced it provided Beleaf Medical, LLC a secured credit facility of $23 million to fund its Missouri expansion.
AFC Gamma reported its Q2 2021 financials showing net income of $4.6 million or earnings of $0.34 per basic weighted average share of common stock. In addition, the company saw distributable earnings of $5.8 million or $0.43 per basic average share of common stock. Specifically, in Q2 the company closed $71.3 million of new commitments and funded $77.8 million of new and existing commitments. AFC has paid its dividend for Q2 2021 of $0.38 per common share. As of August 1st, the company has a portfolio consisting of loan commitments worth $195.3 with $175.3 million of outstanding principal across 14 portfolio companies. On September 15th the company raised its quarterly dividend by 13.2% to $0.43 per share.
AFCG Stock Performance
AFCG stock closed on September 15th at $22.47 up 6.69% in the past five trading days. Currently, AFCG stock has been trading since March and has a price range of $19.75-$25.05 up 7.55% in the last month. According to analysts at CNN Business AFCG stock has a 12-month median price target of $26.75 per share. In essence, this would represent an upside of 19.05% from its last stock price of $22.47.
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Ascend Wellness Holdings, Inc.
AWH is a vertically integrated operator with assets in Illinois, Michigan, Ohio, Massachusetts, and New Jersey. Primarily, AWH owns and operates state-of-the-art cultivation facilities, growing award-winning strains and producing a curated selection of products. Its business provides accessible retail experiences, trusted products, and exclusive brand partnerships and produces and distributes Ozone branded products. In general, the company’s cannabis product categories include flowers, pre-rolls, concentrates, vapes, edibles, and other cannabis-related products. At the present time, AWH operates 17 retail locations and sells its products to third-party licensed cannabis retail stores.
AWH reported its second-quarter 2021 financial with net revenue of $83.4 million up 26.1% sequentially. Specifically, the company increased its 2021 full-year net revenue guidance to $330-$350 million. AWH sustained a net loss of $44.9 million in Q2 2021 mainly driven by a $32 million non-cash interest expense related to the company’s IPO completed in May of 2021. In 2021 the company added five new dispensaries year to date with 3 becoming operational in the second quarter. Additionally, on September 13th AWH announced it has brought legendary brand Lowell Smokes pre-rolls from Lowell Farms Inc. (OTC:LOWLF) to the Massachusetts market. The partnership is an expansion to a similar launch in Illinois by the two companies.
AAWH Stock Performance
AAWH stock closed on September 16th at $8.80 down 12.61% in the past five days. The stock has a price range of $8.40-$15.81 and is down 20% in the last month. According to an analyst at Tip Ranks AAWH stock has a 12-month average price target of $15.00 per share. In this case, this would represent a gain of 70.45% from its last trading price of $8.80. As the cannabis sector shows some upside these could be the top cannabis stocks for your list right now.
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