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The following is a lost of stocks in the cannabis and marijuana industry, with their sales growth over the last five years.
The following is a lost of stocks in the cannabis and marijuana industry, with their sales growth over the last five years.
They are listed in increasing order.
| Company | Symbol | Sales Gr past 5 yrs |
| Scotts Miracle-Gro | SMG | 14.5% |
| Village Farms | VFF | 17.8% |
| OrganiGram | OGI | 66.8% |
| Tilray | TLRY | 98.2% |
| Hexo | HEXO | 131.2% |
| Cronos | CRON | 166.5% |
| Aurora | ACB | 179.4% |
| Innovative Industrial Properties | IIPR | 263.8% |
by Fred Fuld III
Some brokerage firms, such as E*TRADE, have sent out notices that they will no longer handle the trading of certain pot stocks and other companies which trade on the Pink Sheets, that are considered “Pink No Information”. This would go into effect on September 28, 2021.
Last year, the SEC came out with a ruling that would prohibit broker-dealers from publishing quotations for an issuer’s security when issuer information is not current and publicly available.
Pink No Information means that the company is unwilling or unable to provide current financial disclosure information. Fortunately, most pink sheet stocks do not fall into this category. As a matter of fact, I could find only one marijuana stock that falls into this category. This could be because the SEC has already suspended over 70 of these stocks in various industries back in February and March of this year. Many of these stocks were involved in “pump and dumps”.
There may be other cannabis stocks that are Pink No Information, but it is hard to tell just from the name of the company, and there are over 250 stocks that I would have to go through. Also, you may want to check your Pink stocks on September 27 to see if they have fallen into this category.
The other two types of Pink Sheet stocks are Pink Current Information and Pink Limited Information. Current means all financial information is up to date. Limited means that the company may be behind in its reporting due to bankruptcy or financial reporting issues. This SEC ruling does not affect stocks in these two categories, at least yet.
Some brokers, such as Firstrade, have said that it also affects Grey Market and Expert Market stocks.
On Tuesday, September 28, 2021, new amendments to Rule 15c2-11 under the Securities Exchange Act of 1934 go into effect that will impact the market for certain over-the-counter (OTC) securities classified as Pink No Information, Grey Market, and Expert Market OTC securities (collectively, “Impacted OTC Securities”).
The Grey Market is for stocks that have been suspended from trading or can be for pre-IPO stocks. The Expert Market is for private transactions between broker dealers and professional investors.
To find out what category your Pink Sheet stocks fall into, or any other OTC stock for that matter, you can enter the stock ticker symbol at OTCMarkets. This site provides information on all over-the-counter and Pink Sheet stocks.
You can also look up all the No Information stocks by going to the Stock Screener at OTCMarket, go to the Markets section at the top and choose Pink No Information.
At the time this is being written, there are 2,391 stocks in the Pink No Information category. There are also 825 Expert Market and 3,270 Grey Market stocks.
You should be aware that you aren’t required to sell these stocks. It’s just that if you ever wanted to sell the stocks, who are you going to sell them to, if all brokers will prohibit the buying of any of these securities. In addition, there won’t be any price quotes for the stocks.
So remember, check your portfolio on September 27 since this goes into effect on September 28. Also, keep in mind that any of the companies on the list may get their filings with the SEC updated by the deadline.
by Fred Fuld III
During the last twelve months, many of the cannabis stocks, such as (TLRY) and Canopy Growth (CGC), have been hit hard with some stocks, such a Tilray (TLRY) dropping 76% and Canopy Growth (CGC) down 54%. Some investors and traders think that the marijuana stocks may have hit bottom and there may be some buying opportunities.
However, if you are a relatively conservative investor, you probably want to receive a dividend in return for the risk you are taking. Luckily, there are some cannabis stocks that provide investors with a decent dividend yield.
One example is Scotts Miracle-Gro Company (SMG), which has a couple divisions in the marijuana industry. Its Hawthorne Gardening Company division purchased General Hydroponics which manufactures and sells products for marijuana growers. Scotts has also invested in the hydroponics company AeroGrow International (AERO) which sells products to the small scale grower. Scotts’ current yield is 1.92%. Last August, the company raised its dividend to 58 cents per share, an incense of 5.5% over the previous quarter. The dividend has increased on an annual basis since 2015. The stock has a trailing price to earnings ratio of 15 and a forward PE of 22.
AbbVie Inc. (ABBV) is a seller of Marinol, also known as Dronabinol, a form of tetrahydrocannabinol, one of the main psychoactive ingredients of marijuana. The company has been paying quarterly dividends and has increased the annual dividend every year since 2013. AbbVie’s annual forward dividend yield is 5.77%. The company just raised its dividend to $1.07 per share per quarter, a 9.3% increase. The stock trades at 37 times trailing earnings and 8.5 times forward earnings.
Innovative Industrial Properties Inc. (IIPR), which trades on the New York Stock Exchange, owns, manages, and leases real estate to state licensed cannabis growing businesses. The company has increased dividend every quarter for the last four quarters, the latest dividend increasing my 28%. The company pays a dividend yield of 4.25%. The stock trades at 62 times trailing earnings and 20 times forward earnings.
Horizons Marijuana Life Sciences Index ETF (HMLSF) is an exchange traded fund that invests in many companies involved in the marijuana industry. It has a yield of 12%, based on its latest quarterly payment of $0.202 per share. The reason why the dividend income is so high is because most of the income comes from fees and interest from securities lending. This ETF’s largest holdings are:
Altria (MO) is primarily in the tobacco business, as it manufactures and markets cigarettes and smokeless tobacco. The company invested over a billion dollars in Cronos Group (CRON), the Canadian marijuana company. The stock pays a generous yield of 7.0%.
Molson Coors (TAP) is the seventh largest beer maker in the world. The company is in partnership with HEXO (HEXO) to produce cannabis-infused beverages in Canada. Molson Coors yields 4.05%.
Constellation Brands (STZ), which produces and markets beer, wine, and liquor, has a major ownership of shares in the Ontario, Canada based cannabis company Canopy Growth (CGC). Constellation has a dividend yield of 1.56%.
To be blunt about it, here’s the straight dope. Maybe some of these stocks will get high, and give you a smoking portfolio from this budding industry. You may even hit the jack pot. Just make sure you weed out the bad stocks, because if you don’t, your portfolio will take a hit and go up in smoke.
Don’t forget to read:
Exclusive Interview with Chet Billingsley CEO of Mentor Capital on the Marijuana Industry
Is Apple Getting into the Marijuana Industry?
Disclosure: Author owns CGC and IIPR.
by Fred Fuld III
Over 60% of states have legalized marijuana, either for medical purposes or for both medical and recreational use. In addition, Canada has legalized recreational cannabis throughout all the provinces after the passage of the Cannabis Act (also known as Bill C-45), joining Uruguay as the second country to do so nationwide.
If you want to invest in a new budding industry (no pun intended), it is generally considered a good idea to choose the largest stocks to invest in. They have greater liquidity, a larger following by analysts, and the large size is usually due to stronger earnings, stronger revenues, or at the very least, greater growth potential of revenues.
So if you are looking to place your investment dollars in the cannabis industry, you might want to start you due diligence with the largest companies by market cap. (market capitalization is the total number of shares times the current market price).
The biggest one by far is Canopy Growth Corp (CGC) with a market cap of $15.3 billion. The company has a big advantage in that Constellation Brands (STZ) invested a huge amount of money in the company, owning over a third of Canopy shares. Constellation known for its beer and wine, markets Pacifico and Corona beer, Robert Monday and Clos du Bois wine, and Svedka vodka. Canopy has a forward price to earnings ratio of 357 and trades at 2.87 times book value.
Coming in second place is Aurora Cannabis (ACB) with an $8.4 billion market cap. The stock has a forward P/E ratio of 555.5 and price to book value of 2.58.
GW Pharmaceuticals (GWPH) is a $5.64 billion company involved in developing cannabinoid biopharmaceutical products. It trades at 8.82 times book value.
Cronos Group (CRON) has a $5.13 billion market cap and produces and sells marijuana products in Canada, Germany, and other areas. The stock trades at 69 times forward earnings and 7.1 times book value.
Tilray (TLRY) has a $4.3 billion market cap. The company is developing cannabis infused beverages in partnership with Anheuser-Busch InBev (BUD). Tilray has a nosebleed-level forward P/E ratio of 1,111 and a price to book of 11.1.
Maybe one of these stocks will help your portfolio get higher and higher. Many tiny pot stocks are cropping up like weeds. Be careful with the smaller companies as they may go up in smoke and throw your portfolio out of joint. (Puns intended.)
Don’t forget to read:
Exclusive Interview with Chet Billingsley CEO of Mentor Capital on the Marijuana Industry
Is Apple Getting into the Marijuana Industry?
Disclosure: Author owns CGC.
