Federal Cannabis Legalization And Reform And Its Effects On Cannabis Stocks
As the House votes on federal marijuana legalization top marijuana stocks continue to trade near some of their lowest price points in 2021. After reaching new highs in February the best cannabis stocks to buy have seen seven months of declines in the market. Now with some potential catalysts in Congress, more investors are focusing on investing in the cannabis industry. In the US cannabis companies have been reporting strong revenue growth in their financial results this year.
Although this has not translated into gains for the best pot stocks it does show the strength of these companies going forward. In the US as more states legalize cannabis use companies are expanding to establish their footprint. Additionally, already established states like California are seeing demand increases and retail sales growth with a recreational cannabis market that is estimated to reach $5 billion by 2022. In California, there are many different companies that are establishing their market share in 2021.
Recently some new companies have come to the market giving investors new investment opportunities. Before investing in cannabis stocks there are some important factors to consider. For one marijuana stocks are known to be some of the more volatile stocks in the market. Because of this more investors prefer trading these stocks as short-term investments. In general, some investors use day trading, and swing trading methods to achieve returns as these stocks fluctuate in price.
Making Investments In US Pot Stocks In 2021
For the most part, researching a company’s earnings and studying how the stock moves in the market can help you achieve the best returns on your investment. As the potential for federal marijuana banking reform and the end of cannabis prohibition increase pot stocks could be setting up for a rally. But for the past few weeks, the overall markets have pulled back from record highs bringing top cannabis stocks lower in the market.
Because historically September is known to be one of the worst trading months in the market, we could see upside from these levels. If you’re making a watchlist it’s important to find some marijuana stocks that are showing growth potential as the industry expands. While California is one of the largest US markets at the present time some of the top producers have a strong presence there. Let’s look at 2 top marijuana stocks for your list in October.
Top Pot Stocks For Your Watchlist In Q4 2021
Glass House Brands Inc.
At the present time, Glass House Brands Inc. is one of the fastest-growing, vertically integrated cannabis and hemp companies in the U.S., with a decisive focus on the California market and building leading, lasting brands to serve consumers across all segments. Through its portfolio of brands, which includes Glass House Farms, Forbidden Flowers, and Mama Sue Wellness, Glass House is realizing its vision of excellence, outstanding cannabis products, and produced sustainably, for the benefit of all. On September 15th the company completed a 5.5 million-square-foot Southern California greenhouse facility acquisition.
In August Glass House reported its second-quarter 2021 results with net sales of $18.7 million an increase of 62% year over year. As a result, the company delivered gross profits of $8.7 million an increase of 56% from the previous year. Notably, the company had a gross margin of 46% in Q2 2021. In addition, the company had an adjusted EBITDA of $2.2 million a 100% increase from Q2 2020. GLASF stock is trading at $5.38 on September 29, 2021, down 6.16% in the past five trading days. The stock has a price range of $5.00-$5.79 and is down 47.18% year to date.
TPCO Holding Corp.
Another leader in the California market, TPCO Holding Corp. is one of the largest cannabis operators in the state. Primarily, the company is composed of direct-to-consumer platform Caliva, and hemp manufacturer Left Coast Ventures. Additionally, TPCO also has involved icon and entrepreneur Shawn Jay-Z Carter. To highlight, Carter is the Chief Visionary Officer and brand strategist for TPCO. Also important, Roc Nation is in the partnership providing artists, athletes, and influencers to establish brands. In August the company introduced Troy Datcher as the Company’s new Chief Executive Officer. Notably, Datcher’s appointment represents the first time a Black CEO will lead a major public U.S. cannabis organization.
TPCO also provided its second quarter 2021 earnings with net sales of $54.2 million. In detail, this revenue is made up of $11.9 million in direct-to-consumer revenue and $42.3 million in wholesale revenue. As a result, the company delivered, gross profit for Q2 2021 of $8.1 million or 15% of net sales. In 2021 the company launched Shawn “JAY-Z” Carter’s MONOGRAM a high-end premium cannabis product. This product has one-of-a-kind packaging with reimages of iconic photos of American photographer Slim Aarons. Also, TPCO has three streamlined facilities producing 8 core brands with a focus on higher-margin product offerings. The company made its first inaugural investments in Black and women-led businesses. To close August TPCO expanded its product portfolio with the launch of well by Caliva lotions and tinctures. GRAMF stock is trading at $3.24 on September 29th down 10.05% in the last month.
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