Top 3 Marijuana Stocks to Watch in July 2026
The cannabis industry continues to evolve in 2026. However, ancillary marijuana companies remain attractive because they support the industry without directly touching the plant. These businesses provide cultivation equipment, hydroponic supplies, greenhouse technology, and lawn care products. As a result, they can benefit from long-term cannabis expansion while reducing regulatory risk.
Three ancillary cannabis stocks stand out for July 2026. GrowGeneration (NASDAQ: GRWG), Hydrofarm Holdings Group (NASDAQ: HYFM), and Scotts Miracle-Gro (NYSE: SMG) each serve different parts of the cultivation market. Furthermore, all three continue adapting to changing industry conditions while positioning themselves for future growth. Here is a closer look at each company.
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Top Ancillary Cannabis Stocks to Watch as the Industry Expands
- GrowGeneration (NASDAQ: GRWG)
- Hydrofarm Holdings Group (NASDAQ: HYFM)
- Scotts Miracle-Gro (NYSE: SMG)
GrowGeneration (NASDAQ: GRWG)
GrowGeneration remains one of the largest specialty hydroponic and cultivation suppliers in the United States. The company serves both commercial cultivators and home growers. It sells lighting systems, nutrients, irrigation equipment, environmental controls, and growing media. Additionally, GrowGeneration continues expanding its proprietary product portfolio. That strategy helps improve margins while building stronger customer loyalty.
The company currently operates 19 retail garden centers across nine states. Its strongest presence remains in major cannabis markets, including California, Colorado, Michigan, Oklahoma, Nevada, and Arizona. Besides its retail stores, GrowGeneration also serves commercial operators through its wholesale business and online platforms. This combination gives the company exposure to both large cultivators and smaller independent growers. Furthermore, management continues optimizing its store footprint while focusing on higher-margin commercial sales. As more cultivation projects begin across legalized markets, GrowGeneration remains well-positioned to supply the industry’s infrastructure needs. Therefore, many investors continue watching GRWG as one of the leading ancillary cannabis companies.
Financial results have begun to show meaningful improvement in 2026. First-quarter revenue reached approximately $38.4 million. That represented year-over-year growth of 7.5%. Meanwhile, proprietary brand sales increased to 37% of cultivation revenue. Gross margin remained above 25% despite continued store optimization efforts. Additionally, operating expenses declined significantly because management continued to reduce costs. Net loss also narrowed compared to the previous year. Adjusted EBITDA improved substantially as profitability moved closer toward breakeven. Perhaps most importantly, GrowGeneration finished the quarter with more than $41 million in cash and no debt. Management also reaffirmed full-year revenue guidance between $162 million and $168 million. Consequently, investors remain encouraged by improving operations and strengthening financial flexibility.
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Hydrofarm Holdings Group (NASDAQ: HYFM)
Hydrofarm Holdings is another major supplier serving the controlled-environment agriculture and cannabis cultivation sectors. The company distributes hydroponic equipment, nutrients, grow lights, ventilation systems, growing media, and climate control products. Unlike traditional retailers, Hydrofarm focuses heavily on supplying commercial cultivators through an extensive distribution network. This approach allows the company to reach growers across many legal cannabis states.
Hydrofarm serves customers throughout the United States and Canada using multiple distribution centers. Although it does not operate cannabis dispensaries, it plays an essential role in supporting licensed cultivation facilities. Its products are widely used by commercial cannabis producers as well as greenhouse operators growing vegetables and specialty crops. Furthermore, Hydrofarm owns several proprietary brands that strengthen customer relationships while improving profitability. Management continues to emphasize operational efficiency after several difficult years in the industry. Therefore, the company remains well-positioned to benefit as cannabis cultivation accelerates. Investors continue monitoring HYFM because ancillary suppliers often recover alongside improving cultivation demand.
Hydrofarm continues focusing on improving profitability through disciplined expense management. Revenue remains under pressure due to slower cultivation spending across parts of the cannabis market. Nevertheless, management has reduced operating costs and improved inventory efficiency. Gross margins have stabilized as higher-margin proprietary brands account for a larger share of total sales. Additionally, the company continues to reduce debt while strengthening its balance sheet. Cash preservation also remains a top priority during the current market cycle. Investors continue to watch quarterly revenue trends for signs of renewed investment in commercial cultivation. If cannabis licensing activity increases again, Hydrofarm could experience stronger demand for its equipment portfolio. Therefore, HYFM remains a closely followed turnaround candidate within the ancillary cannabis sector.
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Scotts Miracle-Gro (NYSE: SMG)
Scotts Miracle-Gro represents one of the most established names connected to cannabis cultivation. Although the company remains best known for consumer lawn and garden products, its Hawthorne Gardening subsidiary focuses directly on hydroponics and controlled environment agriculture. Hawthorne supplies lighting, nutrients, growing systems, and cultivation equipment used by many commercial cannabis operators.
Scotts enjoys nationwide distribution throughout the United States. Its traditional consumer business reaches thousands of retail locations, including major home improvement stores and garden centers. Meanwhile, Hawthorne serves commercial cannabis cultivators across nearly every legal cannabis market. Unlike smaller ancillary companies, Scotts benefits from diversified revenue streams outside cannabis. That diversification provides additional financial stability during slower cannabis industry periods. Furthermore, management continues investing in innovation while streamlining Hawthorne’s operations. As cannabis cultivation expands over time, Scotts remains positioned to participate through its established infrastructure and respected brands. Consequently, many long-term investors continue viewing SMG as a lower-risk cannabis exposure opportunity.
Recent financial performance reflects improving conditions after several challenging years. Scotts has benefited from stronger consumer demand for lawn and garden products while continuing its restructuring efforts within Hawthorne. Management remains focused on cost reductions and improving cash generation. Additionally, the company has worked to reduce debt and strengthen overall financial flexibility. Hawthorne’s performance continues to depend largely upon commercial cannabis cultivation spending. However, management believes industry conditions should gradually improve over time. Scotts also continues generating substantial cash flow from its core consumer business. That dependable revenue supports ongoing investments and provides stability during periods of cannabis market weakness. Therefore, many investors continue to view SMG as one of the strongest ancillary marijuana stocks to watch in July 2026.
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