Investors have diverse choices when it comes to cannabis stocks. Here's a look at the largest players in the sector and their operations.
The cannabis stock market offers investors the opportunity to get exposure to a revolutionary drug sector.
Although there's been major upheaval in the world of cannabis investments, with the current landscape at times showing stories of difficulty and losses, experts remain bullish on the long-term progress of the global market.
As laws and perspectives surrounding cannabis continue to change across jurisdictions, investors interested in this fast-moving industry will want to keep an eye on the progress of the cannabis stock universe.
Here the Investing News Network presents a list of some of the biggest cannabis stocks in the market.
This list was put together based on the top-weighted pure cannabis stocks included in the AdvisorShares Pure US Cannabis ETF (ARCA:MSOS) and the Horizons Marijuana Life Sciences Index ETF (TSX:HMMJ), as of September 26, 2022.
Cannabis remains illegal at the federal level in the US, but state market openings have allowed US-based operators to thrive. Typically these firms set up vertically integrated businesses with a focus on branded products, retail networks and licenses.
While these companies have adapted to regulatory challenges, they have much to gain from country-level reform in the US, and are eager to see more welcoming federal laws that will allow their businesses to develop further.
Green Thumb Industries is headquartered in Chicago, Illinois, and produces and sells medicinal and recreational cannabis through wholesale and retail channels in the US. It offers multiple products under a portfolio of cannabis consumer packaged goods brands.
Green Thumb Industries holds a weight of 20.34 percent in the MSOS fund. Shares of GTI have dropped by 45.61 percent year-to-date.
Curaleaf Holdings is headquartered in Wakefield, Massachusetts, and cultivates and sells medicinal and recreational cannabis in the US. Curaleaf bills itself as one of the only US-based state operators that is expanding into the emerging European cannabis market.
Curaleaf has a weight of 18.87 percent in the MSOS ETF. Its share price has dropped over a year-to-date period by 28.07 percent.
Trulieve Cannabis is a vertically integrated seed-to-sale and fully licensed medical marijuana company. It is mainly engaged in the cultivation, possession, use, sale and distribution of medical cannabis. Trulieve is an operator based in the state of Florida, and holds a dominant market share in the Sunshine State. However, the firm has expanded its reach into other legal state markets as well.
Trulieve has a weight of 15.21 percent in the MSOS fund. Shares have fallen 52.03 percent over a year-to-date period.
Verano Holdings is a vertically integrated multi-state operator in the US. The firm operates licensed cannabis cultivation, processing and retail facilities. It produces a suite of premium, artisanal cannabis products sold under its portfolio of consumer brands.
Verano has an 11.72 percent weight within the MSOS fund. Over a year-to-date period, shares have dropped 52.27 percent.
Cresco Labs is a vertically integrated multi-state cannabis operator in the US. It grows, manufactures and distributes cannabis using a consumer packaged goods approach, selling its products through wholesale and company-owned retail channels in numerous states.
Cresco Labs accounts for 7.68 percent of the weight of the total MSOS fund. Shares of this cannabis operator have dropped over a year-to-date period by 45.94 percent.
Cronos Group cultivates and sells medicinal and recreational cannabis in Canada. Although it primarily operates in Canada, Cronos exports medical cannabis abroad as well as, and has partnerships outside of Canada. The firm also sells hemp-derived CBD products in the US through a partnership with PharmaCann.
Cronos stands for 14.4 percent of the total weight of the HMMJ fund. Shares have dropped 24.05 over a year-to-date period.
Tilray is a Canadian producer that cultivates and sells medical and recreational cannabis. In 2021, Aphria acquired Tilray in a reverse merger and renamed itself Tilray. The bulk of Tilray's sales are in Canada and in the international medical cannabis export market. The company's US exposure consists of CBD products.
Tilray represents a 10.57 percent weight within the HMMJ fund. Over a year-to-date period, Tilray has dropped 54.13 percent.
Canopy Growth, headquartered in Smiths Falls, Canada, cultivates and sells medicinal and recreational cannabis, as well as hemp, through a portfolio of brands. Additionally, the firm has interests in the US with an acquisition option for Acreage Holdings (CSE:ACRG.A.U,OTCQX:ACRHF). The firm has the financial backing of alcohol-maker Constellation Brands (NYSE:STZ).
Canopy Growth stands for 10.32 percent of the HMMJ fund. Canopy shares have dropped by 63.01 percent over a year-to-date period.
SNDL, formerly Sundial Growers, is engaged in producing and marketing cannabis for the adult-use market. The company's primary focus is on producing and distributing inhalable products and brands. SNDL is pursuing international assets in addition to its Canadian operations, and has expanded with holdings in Germany and Israel.
SNDL represents 3.46 percent of the total weight within the HMMJ ETF. Shares of the operator SNDL have declined in value by 55.09 percent over a year-to-date period.
Organigram Holdings is a Canadian licensed producer of cannabis products. Organigram focuses on producing indoor-grown cannabis for patients and adult recreational consumers, as well as developing global business partnerships. Organigram has undergone a restructuring plan in order to focus on pursuing organic revenue growth.
Organigram accounts for 2.8 percent of the weight of the HMMJ cannabis fund. Over a year-to-date period, shares of Organigram have dropped 43.72 percent.
Are cannabis stocks worth investing in?
Each investor will have to think and act for themselves to manage their own risk exposure, but it’s no secret that cannabis stocks have taken a beating for some time now. While financial experts point to the long-term upside of US operators as more state markets expand, the stock market has not been kind to these names lately.
Are cannabis stocks considered a high- or low-risk investment?
Cannabis investments are extremely young in the grand scheme of the investment universe. There is an exciting and refreshing element to these stocks, but the market has always been characterized by volatility and unpredictability.
While wild, spontaneous swings in the open market have become less common, cannabis stocks are often moved — both positively and negatively — by big pieces of market news or legalization updates.
Why do people buy cannabis stocks?
Investors may choose to get exposure to the cannabis market as a way to participate in the development of a new-age drug market with consumer packaged goods capabilities. Some participants are bullish on the industry's long-term outlook and expect more welcoming laws in the US and across the world to provide upward momentum.
Don’t forget to follow us @INN_Cannabis for real-time updates!
Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.
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