Investing In Marijuana Stocks In 2021
Are you looking for the best way to invest in top marijuana stocks? For the past few months, the cannabis sector has experienced a downturn in the market. Quite frankly most leading cannabis stocks to buy are now trading near levels they had in December of 2020. Although most marijuana stocks to watch set new highs in February, the trading that followed saw a significant decline in market value.
Now with pot stocks trading at a much lower price point, it could be time to find ways to invest in the cannabis market before it begins to rebound in the market. Many investors have been buying stock in leading cannabis companies for short-term gains in the market. But for long-term investors, the market volatility found in top marijuana stocks can be a little overwhelming. For those looking for other options to gain exposure to the growing cannabis industry, there are some cannabis plays with more stability.
For one ancillary marijuana stocks have seen substantial gains in the past 6 months. Actually, companies like GrowGeneration Corp. (NASDAQ: GRWG) a rapidly expanding gardening and hydroponic supply store was one of the best performing cannabis stocks in 2020. And has also held on to its value quite well during this pullback. For a long-term investment in the cannabis market GRWG stock is one to consider.
Cannabis ETFs In 2021
Another way more investors are gaining exposure to the cannabis industry is by investing in marijuana ETFs. Exchange-traded funds are a type of investment fund and exchange-traded product that trades on the stock exchange. Similar to mutual funds in many ways ETFs differ because they can be bought and sold throughout the day. Specifically, cannabis ETFs could be a more stable way to invest in the marijuana industry. In some cases, ETFs also provide investors with dividend earnings.
Currently, not many marijuana stocks offer a dividend to long-term investors. Another reason marijuana ETFs could be a good option for investors is their broader exposure to a part of the cannabis market. Most cannabis ETFs are invested in a large area of the cannabis market and can give investors exposure to the industry on a larger scale than investing in one company. With this in mind let’s take a look at 2 marijuana plays that could be better for long-term investing.
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Marijuana Stock And Cannabis ETF To Watch:
- Innovative Industrial Properties, Inc. (NYSE: IIPR)
- ETFMG Alternative Harvest ETF (NYSE: MJ)
Innovative Industrial Properties, Inc.
Currently one of the only companies of its kind Innovative Industrial Properties, Inc. is a real estate company focusing on leasing properties solely to the regulated U.S. cannabis industry. At the present time, IIP owns 69 properties across 18 states nationwide. Recently, the company acquired a property in Michigan and expanded a real estate partnership with Green Peak Industries. At the beginning of April, IIP announced it also expanded a real estate partnership with a Jushi Holdings Inc. subsidiary at a Pennsylvania growing and processing facility.
In its latest earnings report, IIP released full-year 2020 total revenues of approximately $116.9 million up 162% from 2019. As an incentive for long-term investing, IIP has a dividend totaling $4.47 per share a 58% increase from its 2019 distribution. Additionally, IIP declared its first quarter 2021 dividend of $1.32 per share. On May 6th IIP is expected to release its next quarterly earnings. Currently, analysts are expecting EPS growth of 26% and 39% year over year. 
IIPR stock is down 2.80% year to date with a high of $222.08 in February. Currently trading at $180.84 IIPR stock is down 1.37% in the last 30 days. According to analysts at Tip Ranks IIPR stock has a 12-month average price forecast of $200.00 per share. In essence, this would be a 10.34% increase from current levels. Because IIP has a long-term portfolio with the top cannabis companies in the U.S. IIPR stock could be one of the best marijuana stocks to buy for a long-term position.
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ETFMG Alternative Harvest ETF
ETFMG Alternative Harvest ETF is currently the world’s largest ETF to target the cannabis industry with net assets of $1.75 billion. Currently, the assets in the fund are from top Canadian marijuana stocks like Aphria Inc. (NASDAQ: APHA), Tilray, Inc. (NASDAQ: TLRY), and medicinal cannabis companies like GW Pharmaceuticals plc (GWPH), and Turning Point Brands, Inc. (TPB).
As an incentive for investors, this cannabis ETF has a dividend with an estimated 2.61% dividend yield. At the present time with the SAFE Banking Act on its way to the senate cannabis reform measures could begin to place in 2021. MJ ETF is up 43.14% year to date with a high of $34.58 in February.
Trading at $21.13 2 hours before the close on April 23rd this marijuana ETF is down 12.37% in the month. According to analysts at Stock Invest are expecting MJ ETF to fall by 4.60% during the next 3 months. This could mean investors should watch MJ ETF for a better entry point at a later date. As an option for a long-term hold with exposure to the Canadian cannabis market MJ ETF is a top cannabis play to add to your watchlist in 2021.
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