Do These Pot Stocks Have Solid Profit Potential
With profitability, being a major issue for many marijuana stocks, some companies in the cannabis industry have been able to show better profits than others. Of course, it is difficult to simply use profitability as the only factor when finding a marijuana stock to watch, but it is definitely important. Among those factors are everything from a company’s financials all the way to what type of innovation it is putting in place. One of the other important things to take note of is what kind of press the company is getting. Given that marijuana stocks are traded heavily off of speculation, the news that comes out about a given pot stock is extremely important.
In addition to this, many leading pot stocks have had trouble in the past 6 months. Following the coronavirus, there was a massive pot stock selloff that led to extremely low prices. As March came and went, we saw some big increases in some of the most popular pot stocks to watch. Now, cannabis stocks seem to be pushing profits to a high level. We have seen gains in that period anywhere from 40-150% at the high end. There is no guarantee when investing in cannabis stocks, but these two pot stocks to watch are definitely worth keeping an eye on.
A Marijuana Stock Alternative
Altria Group Inc. (MO Stock Report) is not a marijuana stock in the traditional sense. But, through strategic investments, the company has delved deep into the cannabis industry. MO stock is heavily traded based on its primary business in the tobacco market. But, it owns as much as 45% of Cronos Group Inc. (CRON Stock Report) this investment, worth more than $1.8 billion has given MO stock a place amidst the cannabis stocks to watch. In addition, the company pays out very solid dividends as an extra reward to investors.
Right now, MO stock is paying dividends of around 8% which is quite high. In the past 50 years, the company has managed to continue increasing those dividends which many investors have been quite happy about. Currently, the company is in the middle of a battle with the International Trade Commission for potential patent infringements. Although this is not a major issue, it could push MO stock to bargain territory. For this reason, investors should continue to view Altria Group as a marijuana stock to watch.
Another Non-Pot Pot Stock to Watch
Imperial Brands Inc. (IMBBY Stock Report) is another sort of marijuana stock that has earned its place on this list. The company is a producer of tobacco and tobacco products based out of the UK. A few years ago, it invested in a cannabis tech company as well as purchasing a stake in Auxly Cannabis Group Inc. (CBWTF Stock Report). Because of this, many view IMBBY stock as a marijuana stock despite not being fully in the industry. IMBBY stock has continued to pay out solid dividends to investors.
Right now, that number stands at 5.4%. Because of this, many investors continue to view IMBBY stock as a solid alternative to some of the more traditional marijuana stocks. As with any pot stock, investors should watch what type of profitability the company is putting out. With tobacco use potentially on the decline, there’s no certainty in the future of Imperial Brands. But, if it manages to gain a real place in the cannabis industry, there’s no telling how far it could go.