Industry watchers are urging investors to sit up and pay attention to US marijuana stocks. As a growing number of states legalize and the industry’s financial woes easing, Wall Street says it’s US pot stocks’ time to shine.
Analysts claim that US marijuana stocks have a more robust profitability path than their Canadian competitors. In addition, pot stocks in the US have a larger playing field despite not attaining federal legalization as of yet. Compared to the much-hyped Canadian pot stocks, US marijuana stocks’ top producers have posed better sales growth. As a result, the US cannabis industry is expected to grow further as already, large companies are acquiring small players.
Cheerleading for American pot stocks
None other than Wall Street is cheering on US marijuana stocks.
Marijuana stocks analyst Eric Des Lauriers said that investors should know that profitability of Canadian and American pot stocks is “night and day.”
The top US operators boast large-scale operations across various states where marijuana is legal. Among these producers include Trulieve (TCNNF), Green Thumb Industries (GTBIF), Curaleaf (CURLF), and Cresco Labs (CRLBF). These companies are best positioned to advance in an industry with a sales forecast of over $28 billion next year.
Nevertheless, there are certain provisions. Until now, federal legalization of marijuana remains a question mark, especially with a number of hesitant lawmakers. Also, the term “profitability” in the context of pot stocks needs to be qualified. While there have been several acquisitions of late, these are often complicated. Finally, there are serious worries that a clique of companies may someday dominate the US cannabis industry. This would dilute the stash with low-quality weed that consumers will reject.
According to Sam Ghods, CEO of California-based pot producer Connected, the industry has become populated with corporations that produce marijuana treated as a “generic consumer good.”
Despite the prospects of having a potential cannabis industry producing subpar weed, many analysts remain optimistic.
Top US Marijuana Stocks
Revenue-wise, Curaleaf leads the pack as the largest US marijuana stock. With over $627 million in sales in 2020, its revenue jumped 184% since 2019. This figure is higher than Canada’s top pot stock, Canopy Growth’s 37% increase in revenue of $436 million in the same period.
Curaleaf edges closer to the now-amalgamated Canadian company Tilray and Aphria, with its combined revenue of $685 million.
Curaleaf has over 100 active dispensaries spread across 20 states. It currently claims the largest market in New York and among the largest in New Jersey.
Second on the list is Green Thumb Industries, which posted sales of $557 million in 2020. The company leads in sales in Illinois and Pennsylvania. Also, it is marijuana analysts’ top selection as pot stock this year.
The third-largest US marijuana stock is Trulieve, boasting $522 million in sales last year. It is centered on medical marijuana, claiming a large chunk of Florida’s market. Coming in fourth place is Cresco Labs, with 2020 sales of $476.3 million.
Other pot stocks to watch are GrowGeneration (GRWG) and Innovative Industrial Properties (IIPR).