Canadian companies dominate the global cannabis market, but US cannabis stocks show much potential for savvy investors.
Investing in cannabis stocks has opened a new venue for investors to enter a rapidly expanding space. Canada has so far dominated the global market in terms of progress, but the US shows much potential for investors.
As more American states join the cannabis legalization movement the potential for gains will only increase. The state of California alone, which officially began legal sales of recreational cannabis on January 1, 2018, is set to make $7 billion a year, according to Fortune.
Nevertheless, those looking to invest in US cannabis stocks have a rigorous job ahead, as the public market can be volatile. Adding to all of this turmoil is the fact that cannabis is still federally illegal in the US under the under the Controlled Substances Act.
To give investors a starting point, we’ve assembled a list of US cannabis stocks on the market today. All had market caps of at least $20 million at the time of publication, and were listed on American exchanges; please let us know in the comments if we’ve missed one you think should be included.
Agritek Holdings (OTCMKTS:AGTK)
First on our list of US cannabis stocks is Agritek Holdings. The company is a real estate investor dedicated to the cannabis sector, and also acts as a consultant for a variety of cannabis brands. Agritek holds real estate in the US, Puerto Rico and Canada.
In a recent press release, Agritek announced it would be opening a cannabis-friendly wellness and vacation resort in Quebec. Guests will be able to preorder cannabis in time for their stay. The retreat center will be the first of its kind.
American Cannabis Company (OTCMKTS:AMMJ)
American Cannabis Company brings its expertise to other players in the cannabis space, offering business planning and market assessment services. It also sells ancillary products focused on this specific market.
In early 2018, American Cannabis signed two new contracts with cannabis clients focused on the state of California. Then in March the company secured distribution deals for its SoHum Living Soils® potting mix and Dr. Marijane Root Probiotic. In August, American Cannabis announced a new CFO, Michael Schwanbeck, who was promoted internally.
AmeriCann is an agricultural tech firm working on the consultation, design, construction and financing of facilities for approved and licensed marijuana operators throughout the US. It is also a certified B Corporation. The company is currently engaged in two facility projects in Massachusetts and Illinois.
In July, AmeriCann received US$3.8 million in equity financing. The company said that the proceeds would go towards the development of its Massachusetts Medical Cannabis Center.
Aphria is a Canadian licensed producer (LP) with a capacity of 9,000 kilograms of cannabis product per year. That number is expected to go up with the company’s planned expansions.
This year Aphria made the decision to let go of its US assets, including a stake in a company based in Arizona. “While I continue to believe there is tremendous opportunity in the U.S. for medical cannabis, the sale of these shares serve the best interests of our shareholders and provide additional and important capital to fund Aphria’s continued growth in Canada and expand into other federally legal international markets,” CEO Vic Neufeld said at the time.
Arena Pharmaceuticals (NASDAQ:ARNA)
Next on our list of US cannabis stocks is Arena Pharmaceuticals. This stock is a traditional biopharmaceutical company working on its pipeline of drug products. Its APD371 candidate is an orally available product harnessing the cannabinoid-2 receptor and seeks to treat visceral pain directly associated with Crohn’s disease.
Arena released its Q2 earnings report in August, showing $6.49 million in sales, but with revenue down 55.18 percent year-over-year.
Aurora Cannabis (OTCMKTS:ACBFF)
Aurora is another Canadian LP working on their strategy in that country. Their proposed Aurora Sky facility, which will produce 100,000 kilograms of cannabis per year, received a cultivation license certification from Health Canada, the government’s regulator, in January.
“The additional cultivation capacity will allow us to further expand our domestic and international market share very quickly, and is expected to significantly accelerate revenue growth this year,” Terry Booth, CEO of the company said in their announcement.
More recently, Aurora released its Q3 2018 report, showing considerable growth across investments and assets, as well as revenues. Like Aphria above, Aurora has also been considered in the running for the possible Diageo deal, and its stock has received a boost from the speculation.
Next on our list of US cannabis stocks is Beleave. The company’s subsidiary earned a cultivation license from Health Canada in June 2017. That same year the company received an additional license from Health Canada to start the commercial production of cannabis oils. “The company has put a lot of time and effort into researching various extraction techniques and is looking forward to putting this knowledge to good use,” Beleave CEO Andrew Wnek said.
In 2018, Beleave received a sales license from Health Canada via its subsidiary Beleave Kannabis Corp. The company also acquired all outstanding shares of Seven Oaks Inc., for a reported $3 million in July.
Choom Holdings (OTCMKTS:CHOOF)
Choom is a Canadian cannabis company with a focus on the retail side of the industry. The company plans to present consumers with the option of products that appeal to the lifestyle aspect of consuming marijuana. The company has been expanding its production with recent acquisitions.
Earlier this year the company revealed the concept design for its proposed retail dispensary strategy. “As the Canadian market approaches a new cannabis recreation marketplace, meeting consumer perception and choice with social credibility will be key,” Chris Bogart, president and CEO of Choom said. Then in June, Choom announced the closing of $10 million in private placement, in exchange for 14,225,352 shares. Aurora, mentioned above, was the main investor, having put in $7 million to the pot. In August, Choom announced it had secured the approval for up to 12 more cannabis retail locations across BC and Alberta. The company now has the potential to hold 52 locations on the west coast.
Canada House Wellness Group (OTCMKTS:SARSF)
This US cannabis stock is working as an operator of other cannabis operations, their goal is to develop strategic partnerships, mergers, and acquisitions. The company earned some market recognition by being added to the list of ventures available to shareholders on the Emerging Marijuana Growers Fund. “For the benefit of all our shareholders, we’re very pleased to have been included within this ETF, for it should bring more professional investor attention to the fine work our team has been doing to enhance the operations of our three divisions,” Larry Bortles, CEO, and chairman of the company said. “As each of our verticals achieve profitability this year, we look forward to becoming a major contributor to the growth of this ETF.”
Canada House released its fiscal year 2018 results on August 28, 2018. The company reported a 47 percent decrease in revenue from the previous year.
CannaRoyalty is a US cannabis stock focused on the operation and management of several cannabis businesses in the US. Their strategy is to create a portfolio of cannabis assets in states where it is legal to sell the product. The company regularly updates shareholders on new deals and tracking its engagement with cannabis ventures in legal states. CannaRoyalty owns assets in research, consumer brands, and infrastructure.
In its research portfolio it holds Anandia Labs, Bodhi Research, and BAS Research. In its consumer brands portfolio it has GreenRock Botanicals, DermaLeaf Skincare, Soul Sugar Kitchen, Best Buds Animal Health, Freya Intimacy Spray, Resolve Digital Health, and more. In its infrastructure portfolio, CannaRoyalty has Cascadia Holdings, Alternative Medical Enterprises, Eureka Management Services, Three Leaf Holdings Corp., and several others.
CannTrust Holdings (OTCMKTS:CNTTF)
CannTrust operates a 50,000 square hydroponic facility in Ontario, under the approval of its LP status. CannTrust obtained sales license from Health Canada for its facility in February.
“The expansion of our Greenhouse Facility together with our Health Canada Sales Licence will allow CannTrust to meet growing market demand and provide maximum value to our customers, partners and shareholders,” Eric Paul, CEO of the company said in a statement.
In May of 2018, CannTrust announced it had entered into bought deal financing with Canaccord for $75 million. Then in June, the company announced the official opening of its new 450,000 square foot facility in Niagara. The facility is estimated to produce 50,000 kgs of cannabis per year.
Canopy Growth (NYSE:CGC)
Canopy is one of the biggest Canadian LPs. The Canadian behemoth earned praise from the industry by brokering a new type of deal last year when alcohol producer Constellation Brands (NYSE:STZ) invested $245 million for 9.9 percent equity of Canopy. Now in August, Constellation made another groundbreaking investment in Canopy – this time $3.8 billion.
According to their most recent quarterly update, the company announced its recorded revenue had increased to 22.8 million, representing a 95 percent year-over-year revenue growth.
Cronos Group (NASDAQ:CRON)
Next on our list of US cannabis stocks is Cronos. Cronos is a company that has been targeting a global reach for its products. Its presence increased thanks to a new venture in Australia. Cronos Australia officially launched in February 2018. According to the company, this option could expand to reach in markets in New Zealand and Southeast Asia. “I think what we’ve seen in the market is an increased rate of voices and momentum around medicinal cannabis access for patients beyond those two patient groups,” Rodney Cocks, CEO, and director of the new Australian venture said during an investor call from Cronos.
The company officially joined the Nasdaq this year, launching a movement of other cannabis companies evaluating the possibility to list in this exchange. Cronos was the subject of a very public short by Citron’s Andrew Left, which had the stock falling 20 percent in one day. The stock more or less recovered a few days later when the company announced a $122 million partnership with Ginkgo Bioworks.
Emerald Health Therapeutics (OTCMKTS:EMHTF)
Emerald Health oversees a variety of arms for the company with different areas of focus, its subsidiary with an LP status, currently operates out of an indoor facility in B.C., however, the company is working on a 500,000 square feet greenhouse facility in Vancouver.
In January the company announced a partnership with DMG Blockchain Solutions to investigate the use of blockchain supply management systems for the cannabis industry, through an entirely new company, CannaChain Technologies.
“There are notable new applications of blockchain technology to validate and assure the source, quality, and integrity of products such as diamonds, wine, and art, along with coffee and other food products,” Avtar Dhillon executive chairman of Emerald Health Therapeutics said in their statement. In August, Emerald announced that it had got an amendment to its Pure Sunfarms license which has expanded its cultivation allotment up to 420,000 square feet.
GW Pharmaceuticals (NASDAQ:GWPH)
GW is another traditional pharma company trading on the NASDAQ exchange. One of their main areas of focus is the treatment epilepsy conditions with their lead cannabinoid product candidate, Epidiolex. GW is currently evaluating this candidate against Dravet syndrome, Lennox-Gastaut syndrome, tuberous sclerosis and infantile spasms.
In December of 2017, the company announced it had been accepted for its New Drug Application (NDA) application for Epidiolex with the U.S. Food and Drug Administration (FDA). Since then, the drug received a historic approval for the drug in June. Oddly enough, shares went down directly following the announcement.
iAnthus Capital Holdings (OTCMKTS:ITHUF)
iAnthus is another operator looking for companies in the US market. Their most recent area of focus is Florida, thanks to a substantial acquisition in the state. The company bought the assets of GrowHealthy Holdings. “The GrowHealthy cultivation and operations team has already established itself as a leader in Florida’s medical cannabis market, and we look forward to contributing iAnthus’ capital and operational resources to fully build out GrowHealthy’s infrastructure,” Randy Maslow, president of iAnthus said in the announcement said.
In June, iAnthus announced that it had granteed 570,000 common shares to employees and a consultant of the company at a rate of $5.70 per share. Then in July, iAnthus announced it was exercising its right to convert $20 million in debentures.
Innovative Industrial Properties (NYSE:IIPR)
Next on our list of US cannabis stocks is Innovative Industrial Properties. This company’s focus on cannabis comes through the acquisition of industrial real estate assets for the growth of medical cannabis. “Concurrently with our acquisition of these properties, we enter into leases with the state-licensed growers under long-term, triple-net lease agreements,” the company said.
As part of their Q2 financial results, the company announced detailed updates for facilities it held in Maryland, New York, and Minnesota. They also claimed revenues of approximately $3.3 million for the quarter.
Insys Therapeutics (NASDAQ:INSY)
Their work with cannabis relates to the development of pharmaceutical cannabinoids. Their pipeline in this area currently holds two candidates involved in a variety of trials. The most advanced includes treatments for childhood absence epilepsy and infantile spasm through a cannabidiol oral solution.
At the end of August, the company then announced the FDA had granted it a Fast Track designation for their epinephrine nasal spray, used for the treatment of anaphylaxis. Shares of the cannabis stock shot up 20 percent after the news broke out.
Intec Pharma (NASDAQ:NTEC)
Intec completed a phase 1 clinical trial of their Accordion Pill platform in combination with CBD and tetrahydrocannabinol (THC). “The study results showed that AP-CBD/THC had significant improvements in exposure of CBD (290 percent – 330 percent) and THC (25 percent – 50 percent) compared with Sativex,” the company explained.
In January the company announced it had obtained a Canadian patent for its Accordion pill. Fast forward to April, Intec announced that it had raised USD$35 million in order to fund its trial of the Accordion pill.
Invictus MD (OTCMKTS:IVITF)
Succeeding Intec on our list of US cannabis stocks is Invictus. This stock is Canadian producer involved with a variety of ventures to increase their reach in the cannabis industry. In February the company provided shareholders with an update and a closer look at its phase 2 facility expansion. In March it was announced that the Gene Simmons, co-founder of KISS, would be joining the company for marketing and PR efforts, and soon after the company announced it would be using the stock ticker GENE on the TSX. While Simmons claimed that he has never smoked the herb, he said that he can appreciate the validity of its medicinal uses for others.
In August, Invictus announced that GTEC Holdings (TSXV:GTEC) had entered into a binding letter of intent with Invictus for up to $2 million. The proceeds from this investment are intended to further the company’s retail expansion strategy.
Isodiol International (OTCMKTS:ISOLF)
Isodiol is a company working in the manufacturing and development of CBD consumer products. The company received a regulatory approval for their candidate Isodiolex treating epilepsy and Parkinson’s disease, by the Brazilian Health Regulatory Agency (ANVISA).
“We have been working towards additional products for the Brazilian medical community and for the last several months, so to have our second product medically approved by ANVISA is a tremendous breakthrough for the company,” Marcos Agramont, CEO of Isodiol said of the approval.The company announced a corporate restructure back in June, and consolidated its issued and outstanding share capital, resulting in a newly reduced total of 40 million shares. This consolidation was finalized on July 24, 2018. In August, Isodiol announced that its subsidiary IsoBev had started gearing up for commercial scale and production of its hemp beer.
Kushco Holdings (OTCMKTS:KSHB)
Kushco Holdings, formerly known as Kush Bottles, is a company based in California working as an ancillary operation alongside the growth of the cannabis industry itself. While holding no direct contact with the actual plant itself, Kushco sells packaging supplies for dispensaries and other businesses. Their expansion since launch has allowed them to sell accessories as well as develop their own brand of products.
In September, Kushco announced its name change from Kush Bottles to Kushco Holdings, effective September 1, 2018. It also revealed that its headquarters had been moved to a larger space in Garden Grove, California, reflecting the company’s growth.
Lexaria Bioscience (OTCMKTS:LXRP)
Lexaria is a company focused on enhancing the flavor, bouquet gastrointestinal delivery of edible cannabinoid consumer products. This year the company started trading on the OTCQX Best Market. On January 25, the company announced a partnership with Cannfections Group, a cannabis chocolate manufacturer, in which Lexaria provided their DehydraTECH for the development of “next-generation performance in cannabis-infused chocolates and candies.”
In July, Lexaria and Hill Street Beverage company (TSXV:BEER) announced that a definitive agreement had been signed to produce a line of cannabis infused beverages. On August 30, Lexaria announced it had positive results for its patented DehydraTECH process, which increased absorption rates by 195 percent in the blood brain barrier of rats tested in the study.
MYM Neutraceuticals (OTCMKTS:MYMMF)
MYM Nutraceuticals is next on our list of US cannabis stocks. The company is focused on acquiring Health Canada licenses to produce and sell high-end organic medicinal cannabis supplements and topical products. Earlier this year, the company was part of a Deloitte report, “Economic Impact Assessment for the Weedon Project,” evaluating the benefits of the Wheedon Project in Quebec and Canada. Fast forward to June and the company announced the finalization of the purchase of 329 acres of land in Weedon. The company intends to build a 1.5 million square foot medical cannabis greenhouse. The project will also include a ‘CannaCentre’ complex which will have a museum, auditorium, restaurant and more. Then in July, MYM announced it would acquire a 49 percent stake in Colombia Organica, a company which holds a seed to sale license for low THC cannabis.
Namaste Technologies (OTCMKTS:NXTTF)
Namaste is a company offering consumers an entirely new platform where they can access and purchase vaporizer products from official manufacturers, and if allowed by the country medical cannabis. In Canada, the company has signed deals with licensed producers (LPs) to offer their products in the NamasteMD app. Through the mobile application, patients can obtain a prescription for medical marijuana.
Sean Dollinger, president, and CEO of Namaste told INN the company plans to launch a smartwatch app that will be able to collect data from the users after consuming cannabis products. In August, Namaste announced supply agreements with several parties including Bonify, GTEC Holdings, and Kief Cannabis. Namaste then teamed up with Snoop Dogg to throw a pledge party for investors in Montreal September 16, 2018.
Phivida Holdings (OTCMKTS:PHVAF)
Phivida works on a brand of CBD infused functional foods and beverages and clinical CBD products. The company updated shareholders on the production capabilities for their rollout of products in the California market. Among these products is its Nano-CBD Iced Teas. “Phivida’s Nano-CBD Iced Tea blends are designed to treat the GI-tract, and maximize the body’s ability to absorb orally ingested cannabinoids and phyto-nutraceuticals,” the company indicated.
Recently, Phivida announced it had hired Brian Schmitt, former Apple designer, to lead the ‘visual identity’ of its new Oki brand. Phivida also announced in August that it had signed a definitive agreement with WeedMD to develop Cannabis Beverages Inc. together.
Tilray is next on our list of US cannabis stocks and is an American owned company with a license to produce cannabis in Canada. Its facility is in Nanaimo, BC, and the company has been in operation since 2013. Tilray produces cannabis flower, oils and sells other cannabis related products both domestically and around the world in countries where medical and or recreational cannabis is legal. Tilray launched its stock in July and it has been on fire since then, jumping from $17 all the way up to $77 on September 4, 2018. Tilay has been earmarked as the potential favourite of a rumoured investment deal with multinational alcohol giant Diageo (LSX:DGE). This is mere speculation however, it has had the market sentiment in its favour also due to favourable Q2 results released in August. Tilray reported a 95 percent year over year revenue increase.
Zynerba Pharmaceuticals (NASDAQ:ZYNE)
Last but not least on our list of US cannabis stocks is Zynerba Pharmaceuticals. The firm is a specialty pharma company working on pharmaceutically-produced transdermal cannabinoid treatments. Their pipeline of candidates holds two cannabis-related products in various trials for different diseases like Fragile X Syndrome and Tourette Syndrome.
One of those products is its ZYN001 which is a skin patch that delivers THC through the dermis. Unfortunately, it did not meet expectations in its Phase 1 trial, and Zynerba shares plummeted 17 percent upon the news. It hit a bit of a downward trend after that but as of September the stock has begun its upward climb once more. The company is now focusing more on its treatment for an autism-spectrum disorder, ZYN002 product.
Would you invest in US cannabis stocks? Why or why not?
Are there any US cannabis stocks you think should be on this list? Let us know in the comments — we’ll be updating it in the future. And don’t forget to follow us @INN_Cannabis for real-time news updates!
Securities Disclosure: I, Amanda Kay, currently hold investments in US cannabis stocks: Aphria, Aurora, and Canopy Growth Corp, all mentioned in this article.
Editorial Disclosure: MYM Neutraceuticals, Invictus MD, Beleave, Isodiol International and Lexaria Bioscience are clients of the Investing News Network. This article is not paid-for content.