Top Marijuana Stocks In July 2021
On the last day in June, top marijuana stocks are trading modestly lower to close the month. In June the cannabis sector seemed to show signs of upward momentum for pot stocks. In 2021 the best cannabis stocks to invest in started the year rallying because of the possibility of US federal reform and legalization. After February 10th the entire sector began seeing declines in the market which persisted for more than 4 months.
One area of the market that was the hardest hit during this time was the Canadian cannabis sector. Because they would be positively affected by US federal policy changes many investors poured into the best Canadian cannabis stocks to buy early this year. In 2021 Canadian cannabis companies have not performed as well as the American companies. In their first-quarter earnings, the US cannabis companies showed strong revenue growth and many leading marijuana companies are either profitable or getting close to achieving profitability.
The same can’t be said about top Canadian cannabis stocks. For the most part, Canadian companies have missed earnings estimates and continue to report losses at the moment. But things could be picking up for these companies as the year progresses. In April Canadian cannabis sales increased 3.8% from March. In detail, Canadian cannabis sales were $309.7 million in April 2021 an increase of 73.6% year over year.
American Cannabis Reform And Canadian Marijuana Stocks Right Now
This year lawmakers have begun to introduce cannabis reform bills like the MORE Act, and the SAFE Banking Act. Recently, other reform bills have also been introduced on Capitol Hill that could change federal cannabis policy in 2021. This will benefit Canadian companies that have been establishing entry into the US cannabis market. In the future, there could be some gains in this sector once a cannabis reform bill passes.
At current market levels, some Canadian marijuana stocks could have significant upside from their stock prices right now. For investors putting these marijuana stocks on your watchlist could produce some gains with more upward momentum in the cannabis sector. For new investors, there are some things to consider about the cannabis sector that can affect how traders approach an investment.
[Read More] 2 Top Canadian Marijuana Stocks For Your Watchlist Next Week
As it stands cannabis stocks are known for being some of the more volatile stocks in the market. This has attracted more short-term traders to the sector and has made it more difficult for long-term investors. One way to establish the best positions for your investments is to do your due diligence and study how a stock performs in the market. With this in mind let’s take a look at 2 Canadian marijuana stocks to add to your July watchlist.
Top Canadian Marijuana Stocks To Watch
- Cronos Group Inc. (NASDAQ:CRON)
- HEXO Corp. (NYSE:HEXO)
Cronos Group Inc.
Cronos Group Inc. is a global cannabis company with international production and distribution across five continents. At the present time, Cronos has created a portfolio of cannabis brands that have gained popularity with Canadian cannabis consumers. The company missed earnings estimates in its latest financials, which has affected its stock price in the market. In detail, the company reported first-quarter 2021 net revenue of $12.6 million up to $4.2 million from Q1 2020. In detail, the company saw a gross loss of $3.0 million in the first quarter with an adjusted EBITDA loss of $37.1 million in Q1 2021.
Recently Cronos announced it purchased options to acquire a 10.5% stake in PharmaCann for $110.4 million. The deal will be executed under various factors including the status of US federal cannabis legalization. In particular, the deal would involve PharmaCann’s six production facilities and 23 dispensary locations. With this announcement CRON stock has begun to see some market momentum.
CRON stock is trading at $8.64 on June 30th up 25.36% year to date. In February CRON stock reached a high of $15.83 and is down 3.44% in the past 30 days. According to analysts at CNN Business CRON stock has a 12-month median price target of $7.21 per share. This would represent a 16.41% decrease from current trading levels. For this reason, CRON stock could be a Canadian marijuana stock to watch for a better entry price.
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HEXO Corp.
HEXO Corp is a leading Canadian cannabis company with award-winning cannabis products for the global industry. Currently, the company is seeing success in the Canadian recreational market with its extensive brand portfolio. HEXO is also producing medical sales in Canada, Israel, and Malta. Another area HEXO has been expanding into is the US cannabis industry. Recently, HEXO entered the Colorado market with Truss CBD USA a joint venture with Molson Coors. At the start of June HEXO closed on the acquisition of Zenabis Global Inc. In Canada, Zenabis is a licensed cultivator of recreational and medical-grade cannabis. As it stands, this deal will help solidify the future expansion for HEXO in Canada, Europe, and other cannabis markets.
HEXO announced its 3rd quarter fiscal 2021 with total net sales increasing by 2% year over year. Although HEXO maintained the number one position in the beverages category its total net sales declined by C$10.2 million from the previous quarter. Due to recent acquisitions and mergers, HEXO could become the 3rd largest Canadian cannabis company by market share. On June 28th HEXO closed the purchase of its first US production facility through its wholly-owned US subsidiary.
HEXO stock is trading at $5.65 on June 30th heading into the close. In February HEXO stock reached a high of $11.04 up 56.52% year to date. According to analysts at Market Beat HEXO stock has a consensus price target of $4.40 per share. In essence, this would be a decrease of 24.3% from its current trading price. With this in mind, HEXO stock could be a top Canadian cannabis stock to watch in July.
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