Top Ancillary Cannabis Stocks to Watch in September 2025
The U.S. cannabis industry continues to expand, with annual sales expected to surpass 40 billion dollars in 2025. Market forecasts suggest long-term growth as more states approve medical and recreational use. Recent discussions on federal legalization have also reignited investor interest. These developments provide a favorable backdrop for ancillary companies, which support the industry without directly handling cannabis. Because they supply cultivators and dispensaries with essential tools, these businesses often face less regulatory risk.
However, investing in ancillary cannabis stocks still requires careful planning and proper risk management. Prices often swing sharply as headlines about legalization or earnings surprises influence sentiment. Therefore, technical analysis becomes a vital tool for identifying entry and exit points. Investors should focus on support and resistance zones while respecting stop losses. By combining disciplined strategies with industry expertise, traders can capitalize on opportunities while mitigating unnecessary risks in this volatile yet promising sector.
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Cannabis Ancillary Stocks Poised for Gains This Month
- GrowGeneration (NASDAQ: GRWG)
- Hydrofarm Holdings Group (NASDAQ: HYFM)
- Scotts Miracle-Gro (NASDAQ: SMG)
GrowGeneration (GRWG)
GrowGeneration operates one of the largest hydroponic and organic gardening supply chains in the United States. The company has built its biggest presence in California, supported by operations in Colorado, Oregon, and Florida. While it does not directly run dispensaries, it is a major supplier for cultivators serving them. Its stores provide nutrients, soils, growing media, climate controls, and advanced lighting systems. The company has also developed its own portfolio of proprietary brands, including Char Coir, Drip Hydro, The Harvest Company, Ion LED, and Viagrow. These brands help it expand into both large commercial grow operations and smaller hobby growers. With dozens of physical retail locations and a rapidly growing online marketplace, GrowGeneration plays an important role across multiple states.
In the second quarter of fiscal 2025, GrowGeneration reported net sales of approximately 41 million dollars. This figure represented a strong sequential improvement, though it remained down from the prior year’s total. Proprietary brands accounted for more than thirty percent of cultivation and gardening revenue, showing increased traction in the market. Gross profit margins improved as well, rising above twenty-eight percent for the quarter. Meanwhile, operating expenses fell significantly, highlighting a disciplined cost-control strategy. Net losses narrowed to under five million dollars, improving from the previous year’s results. The company also carried no debt and ended the quarter with close to fifty million dollars in cash and marketable securities. While adjusted EBITDA remained negative, management’s focus on higher-margin product sales is positioning GrowGeneration for longer-term growth.
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Hydrofarm Holdings Group (HYFM)
Hydrofarm Holdings is a leading distributor and manufacturer of hydroponic equipment and supplies. The company supports controlled-environment agriculture, focusing heavily on commercial cannabis cultivators in the United States and Canada. It operates multiple distribution centers across North America and maintains an international reach as well. Hydrofarm does not own or run dispensaries. Instead, it supplies them indirectly by equipping cultivators with lighting, growing media, nutrients, and environmental control systems. Its portfolio includes both proprietary and third-party brands, giving customers a wide range of choices. Hydrofarm has long been viewed as a backbone supplier for indoor cultivation, making it a critical link in the broader cannabis supply chain.
Financial results in recent years have reflected the volatility of the cannabis sector. For full-year 2024, Hydrofarm reported revenue of just over 190 million dollars. This represented a decline of more than fifteen percent compared to the previous year. Losses widened, with net income negative by more than sixty-six million dollars. Management has been working to reduce excess inventory and streamline operations to control costs. While revenue pressure has been significant, gross margins have begun to improve as the company adjusts its product mix. The focus remains on efficiency, cash flow stabilization, and positioning for future demand recovery. Investors are watching carefully to see whether mid-2025 results will show signs of a turnaround. Hydrofarm’s ability to return to growth will depend on both industry demand and its success in managing expenses.
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Scotts Miracle-Gro (SMG)
Scotts Miracle-Gro is one of the most recognized names in consumer gardening worldwide. While its core business focuses on lawn and garden products, its Hawthorne Gardening division provides hydroponic supplies and equipment to cannabis cultivators. This segment includes nutrients, lighting, and environmental control products, serving growers across many U.S. states. Scotts does not operate dispensaries, but it remains a major ancillary player through its distribution network. With a strong presence in traditional retail, as well as specialized hydroponic sales, the company maintains exposure to the cannabis industry without directly handling the plant.
In the third quarter of fiscal 2025, Scotts reported total revenue of about 1.19 billion dollars. This was slightly lower than the same period in 2024, though overall sales in the U.S. Consumer segment held steady. Hawthorne Gardening’s revenue fell sharply, declining by more than half to around 33 million dollars. Despite this decline, losses in the division narrowed compared to the prior year. Net income for the quarter rose to nearly 150 million dollars, reflecting strength in the broader consumer business. Gross margins also expanded, surpassing thirty-one percent on both a GAAP and adjusted basis. The company reaffirmed guidance for adjusted EBITDA in the range of 570 to 590 million dollars for the full fiscal year. While Hawthorne remains under pressure, the strong consumer segment continues to offset weakness in cannabis-related sales.
Investing in Cannabis 2025
These three companies illustrate the diversity of the ancillary cannabis space. GrowGeneration is aggressively building brand value and retail scale, while steadily improving financial results. Hydrofarm faces revenue challenges but is pursuing cost discipline and efficiency gains to prepare for eventual recovery. Scotts Miracle-Gro leverages the stability of its consumer business while maintaining exposure through Hawthorne Gardening. Each company provides unique advantages and risks for investors. As the cannabis industry grows, ancillary providers like these remain essential to cultivation, supply chains, and overall market development. September 2025 presents an important opportunity to assess their progress and consider their long-term potential in the evolving sector.
MAPH Enterprises, LLC | (305) 414-0128 | 1501 Venera Ave, Coral Gables, FL 33146 | new@marijuanastocks.com
