Investing in the marijuana industry may have seemed taboo a few years back, but as more states are making recreational marijuana legal with Canada legalizing pot nation-wide (the first industrialized country to do so), it seems like a no-brainer to put your money where your mouth is — literally. This year is expected to be the most profitable one in the history of marijuana. Last year, the legal marijuana industry was worth $10 billion for the U.S. alone. Canadians spent just under C$6 billion on cannabis in 2017 and it is predicted that the U.S. marijuana industry could be worth $50 million within the next 8 years.
Despite the hype, one Canadian company is going down for bad business that ultimately affects all its shareholders. Aphria (APHA) lost much of its value after a scathing report came out from Quintessential Capital Management alleging the weed company’s leadership spent less money on assets than it reported to investors. The very next day, class-action lawsuits were filed against the company.
While it is going to be tough for APHA to reel in the trust of its investors again, a Vegas-based cannabinoid (CBD) company called CV Sciences (CVSI) is thriving. The market for CBD is expected to grow by 147% each year through 2022. The issue here is that CVSI is concocting what some call a genius plan to mix nicotine and CBD to create a smokeless tobacco solution, but the patent was rejected and that detail never disclosed to investors. This caused a bit of a disturbance, but somehow did not affect the stock negatively.
Another cannabis stock worth looking into is Tilray (TLRY), which engaged in medical cannabis research, cultivation, processing, and distribution of cannabis products worldwide. Tilray supplies high-quality cannabis products to tens of thousands of patients in twelve countries, primarily through distribution partnerships with major distributors. In addition, Tilray sells recreational cannabis in Canada, primarily through government-owned online and retail stores. The company currently cultivates cannabis in Canada and Europe.