Best Cannabis Stocks For The Long Term Investor
Are you looking for the best ways to invest in top marijuana stocks for the long term? One area has performed much better this year than the rest of the cannabis market. In 2021 marijuana REITs have continued to perform at a higher level than the rest of the best cannabis stocks to buy. This is partly because the US has yet to establish federal marijuana legalization so far this year.
But because cannabis REITs are considered ancillary marijuana stocks, they are not directly affected by cannabis legalization in the same way US MSOs and Canadian pot stocks have been. Ancillary cannabis companies are those companies that support the cannabis industry without touching the actual plant. One reason US MSOs have not traded better in the market is that they are only available on the OTC Market.
On the other hand, most cannabis REITs trade on major US stock exchanges giving them a much larger pool of investors. Another reason cannabis REITs have continued to thrive in the market is that they are one of the only sources of raising capital for leading cannabis companies. Without cannabis banking reform leading US marijuana companies are going to cannabis real estate companies for funding to build facilities for processing and cultivation.
The Cannabis Industry In 2021 And Investing Long Term
One of the best performing marijuana REITs many investors are investing in for long-term returns and a strong dividend is Innovative Industrial Properties, Inc. (NYSE: IIPR). In 2021 IIPR stock is one of the best performing cannabis stocks in the sector. In fact, while the rest of the cannabis sector has declined in October IIPR stock has seen upward momentum. Additionally, other cannabis REITS have also provided shareholders with dividends giving them more appeal for long-term investing.
[Read More] 2 Marijuana Stocks To Watch During The First Week Of November
Before investing in top marijuana stocks, it’s important to do your own due diligence on a company. Researching a company’s financials and studying how the stock behaves in the market can help you establish the best positions for your investments. As the cannabis industry continues to grow in the US leading cannabis companies will need to build new facilities to continue to meet cannabis demand in the US. Let’s look at 2 top cannabis REITs to add to your watchlist in November.
Best Marijuana Stocks To Watch In November 2021
- Power REIT (NYSE: PW)
- AFC Gamma, Inc. (NASDAQ: AFCG)
Power REIT
First on the list is Power REIT a specialized real-estate investment trust focused on sustainable real estate with attractive risk-adjusted returns. At the present time, Power REIT owns a growing portfolio of Controlled Environment Agriculture or CEA properties in the form of greenhouse and associated processing space. Overall, the properties are leased to tenants that are licensed to produce medical cannabis at the facilities. The properties are targeting expansion and Power REIT has the option to fund the capital costs of property upgrades. Power REIT’s greenhouse properties are an environmentally friendly cultivation solution.
This year, Power REIT expanded its Colorado footprint by acquiring a 10-acre property that includes the construction of a 12,000 square foot greenhouse space. Specifically, this gives the company investment properties across Southern Colorado with over 83 acres and 383,328 square feet of CEA facilities. In September the company acquired a 556,146 square foot cannabis greenhouse cultivation and processing facility for $18.4 million. This facility will be the largest cannabis cultivation facility in Michigan and one of the largest in the US. In Power REITs latest results net income per share increase 148% and Core FFO per common share increased 102%. For Q2 the company paid a dividend of $0.4834 per share each quarter which would be a total of $1.9375.
PW Stock Performance
PW stock closed at $50.68 on November 1st down 7.65% in the past five trading days. Currently, the stock has a 52-week price range of $23.12-$59.95 up 83.08% year to date. According to analysts CNN Business PW stock has a 12-month median price target of $63.00 per share. In essence, this represents an upside of 24.75% from its last trading price.
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AFC Gamma, Inc.
Next up we have AFC Gamma, Inc. an institutional lender to leading cannabis companies with strong operations and cash-flow prospects. Established recently in 2020, 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. At the present time, AFC Gamma’s principles are now focused on the exponential growth of the cannabis industry. In October the company agreed to a credit upsize of $250 million 8.50% interest with an additional $100 million option with Verano Holdings Corp. (OTC: VRNOF).
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. Additionally, 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. In August, the company has a portfolio consisting of loan commitments worth $195.3 with $175.3 million of outstanding principal across 14 portfolio companies. In September the company raised its quarterly dividend by 13.2% to $0.43 per share. On October 4th the company posted a record of $119.2 million in total new commitments during the third quarter of 2021.
AFCG Stock Performance
The company is expected to release third-quarter 2021 results on November 4th before the market opens. AFCG stock closed at $23.67 down 1.88% in the past five trading days. The stock has a price range of $19.75-$25.05 and is up 9.88% in the past month. According to analysts at Tip Ranks AFCG stock has a 12-month average price target of $26.67 per share. IN this case, this would represent an increase of 12.63% from its last trading price.
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