Is Now The Time To Buy Marijuana Stocks?
Recent price action in September has shown a correction occurring for marijuana stocks. While the market is receding from its August highs some pot stocks to watch are peeking investor interest. Marijuana stocks like Aurora Cannabis Inc. (NYSE:ACB) are currently seeing its lowest price. This might present a buying opportunity or a good time to average down in the market if you got in at a higher price point. Although this may seem promising for new shareholders when making any investment decisions make sure you research the company thoroughly. This will ensure that you feel comfortable with your investment strategy.
Other Top pot stocks like Cronos Group Inc. (NASDAQ:CRON) are also trading lower when compared to its 50-day moving average. This downtrend can be attributed to a couple of forces working against the stock market. For one, some of these cannabis stocks have been negatively affected by the pandemic shutdowns. Investors can research this by looking into a company’s financials and seeing if the company is showing losses in its reporting in recent quarters. Another factor causing downward pressure in the stock market today is the uncertainty looming around the long-term economic effects of this year’s COVID crisis. With these factors creating a lower price point in the cannabis market here are 2 pot stocks that may present gains for shareholders.
A Leading Canadian Pot Stock To Buy Or Sell
Aphria Inc. (NASDAQ:APHA) is one of Canada’s leading marijuana stocks in the industry. With a strong foothold in both the medicinal and recreational cannabis markets, this pot stock watchlist. Based out of Ontario, Canada, Aphria Inc has reported an increase in adult cannabis sales of 27%. In addition, it has reported five consecutive quarters of net revenue increases for fiscal 2020.
This puts Aphria Inc. competing with some of the largest Canadian pot stocks in the industry. With a current market cap of $1.26 billion Aphria’s stock has seen a steady recovery since the March market crash. Although current market trends are causing the stock to go lower, investors should consider Aphria’s stock a buy at its current levels.
With a good business structure and tremendous prospects for the future Aphria inc is one of the best stocks to watch in the marijuana industry. Although some analysts seem skeptical of the Canadian marijuana market, Aphria Inc. is definitely outperforming the rest of the industry.
A U.S. Marijuana Stock Multi-State Operator
Acreage Holdings, Inc. (OTCQX:ACRGF) is another small cap marijuana stock to watch. The company is vertically integrated multi-state operator in the cannabis industry. With its recent news of an amended agreement with Canadian giant Canopy Growth (NYSE:CGC) the smaller acreage is merging with its larger peer. In the agreement, CGC will pay a cash payment of $37.5 million to Acreage Holdings which should translate to about $.30 a share to investors. This recent acquisition has been scaled down from the original agreement back in April of 2019. This merger provides Canopy Growth with an instant piece of the American marijuana market.
Even though the merger is good for both companies this news was received with Acreage stock price not really being affected and Canopy’s stock losing some ground in the market today. This is partly due to Aurora’s Cannabis report yesterday of a 24% loss in revenue. Triggering a sour sentiment in the market towards Canadian pot stocks.
With the recent market selloff and the continued issues with US economic recovery, this could be the market trend for the rest of 2020. This leads to the question is Acreage Holdings a stock to buy? Judging from its decent stability in the past months it is definitely a marijuana stock to watch.
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