When looking at the marijuana industry, most decide to view the companies with large market capitalizations rather than the smaller players in the market. Although this is often a good strategy, since marijuana as a whole is still relatively in its infancy, the smaller guys are worth taking a look at.
Much of the guiding force in the marijuana market has come from the innovation of these smaller businesses who have in turn been able to grow amidst the changing public sphere of cannabis. This includes small cap stocks as well as the mid cap companies who are both working to use their newly found capital to expand operations into the future.
With the legalization of Canadian recreational cannabis, the domino effect that ensued moreover allowed the entrance of these smaller businesses into the industry. Now that the market domestically in Canada is in full swing, many states throughout the U.S. as well as European nations are working to get their marijuana legislation in place.
GTEC Holdings, Inc. (GGTTF) is one of the smaller companies in the market, but in no way should they be overlooked for their size. Based out of Canada, GTEC has been working to cement their method of growing craft cannabis in indoor grow facilities. The word craft has been thrown around a lot in cannabis, but for GTEC, it simply means producing the highest quality weed no matter the cost. This has landed GTEC in a perfect part of the market as most companies are focused on quantity rather than quality.
Additionally, investors have found that the completely vertical integration of GTEC is one of the main reasons they have been able to report extremely high margins. In addition to these margins, GTEC is also able to have a strong hand in every aspect of their production, which means again, they can produce the highest quality cannabis available. With a market cap just under $60 million, GTEC remains one of the marijuana businesses to be watched over the next few years.
CannaRoyalty (NASDAQOTH:ORHOF) has been noted as one of the better options for investors in the cannabis industry. With a market cap of around $300 million, CannaRoyalty is in no way a small company. The business is up around 30% for this year alone, but many investors think this is just the beginning.
For starters, CannaRoyalty is the largest distributor of marijuana in all of California. The Californian market as many know, could potentially be one of the largest in the world at a projected $7.7 billion by the end of 2022. This means that if CannaRoyalty is able to keep it up, they will be able to be one of the bigger producers of cannabis in the U.S.
CannaRoyalty has been focused on making sure they are selling the most sensible products in the market by using the customer as a research base. The company has been able to acquire a series of various brands which allows them to sell everything from pure cannabis flower to edibles and vaporizing products. The Californian market may have gotten off to a rough start at the beginning of this year, but the future is where the real promise lies for growth in the marijuana sector.
Small and mid-capitalization marijuana stocks may be overlooked by a lot of investors for their volatility, but this uncertainty may just b the factor that makes them grow into the future. The next 2 to 3 years will help to determine the future for these innovative companies as competition continues to ramp up in the marijuana stock market.
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