Marijuana News Today
One of the best barometers for the cannabis industry is to check pot sales against alcohol. This gives investors an idea of just how big this industry can grow. In the marijuana news today, we have hard evidence showing that marijuana is not only capable of matching the alcohol industry, but may very well outpace it in the years to come.
When projecting the high-end potential of pot, alcohol seems like a pretty sensible yardstick to measure with. Both are substances that give a euphoric feeling to the consumer, both faced periods of prohibition in certain parts of the world, and both are largely restricted to adult consumers while also having regulations regarding advertising and distribution.
But when you dig down into the hard numbers, marijuana reveals that it may in fact have more in the tank than booze.
A recent report found that post-legalization, more Canadians are smoking weed than drinking beer. That’s a huge deal. (Source: “Is Legal Marijuana Hurting Beer Sales Or Helping Them?” Forbes, May 21, 2019.)
Consider all the problems that the legal cannabis industry has faced in Canada so far, from shortages to a thriving black market to expensive pot. Even with all that, Canadians have still begun shifting to marijuana in droves.
Now, there’s definitely a novelty factor here in that the newness is likely driving some degree of the early spike in sales. But considering all the problems that the Canadian market has bumped up against, this amounts to a very minor caveat.
The big picture, then, is that the multi-billion-dollar marijuana industry has the potential to eclipse the alcohol industry in the years to come.
And that makes sense when you really think about it. Alcohol is infamous for its deleterious effects on one’s health. Intoxication via alcohol is also much more debilitating than the marijuana high.
I remember years ago I worked as a landscaper one summer in university and several of my coworkers smoked marijuana on the job. They were veterans who had been there for years, so I imagine they had been doing that a long time before I got there. It’s almost impossible to imagine them being able to sustain themselves through the grueling hours and intense heat if they were drunk instead of high.
While obviously not scientific, what my anecdote illustrates is just how much more accepted marijuana is as a more casual substance versus alcohol, where drinking on the job for virtually any career other than stand-up comedian or bartender seems ludicrous.
The future of the cannabis industry is full of potential, and I believe it has more than enough steam to overtake the alcohol industry. It will have to battle through obstacles like stigma, sure, but the end result will be marijuana sales eclipsing alcohol, if I had to place a bet.
And that means, despite the high valuations of marijuana companies now, they pale in comparison to what they could achieve when compared to Big Alcohol. Which means that marijuana stock growth is going to continue for years to come.
While the long term is looking good for pot stocks, the marijuana news today on the pot stock market is decidedly negative: most stocks have fallen several percentage points after yesterday’s industry-wide rally.
The pot stock market has ebbed and flowed this week, and we’re seeing an ebb right now.
Canopy Growth Corp (NYSE:CGC) is one of the stocks that was on the lower end of both phases—both the gains and losses. Canopy Growth stock dropped by about three percent in early-morning trading today and finds itself down about one point over the past five days.
Yesterday, CGC stock similarly wasn’t among the top gainers, although it did register a healthy couple-point move in the morning. This perfectly highlights one of my favorite qualities of this stock: stability.
Canopy Growth has hit such a point in its lifespan that it has largely solidified its place as the industry leader. While upstart challengers have rivaled it in the past, those days have come and gone, and Canopy remains at the top of the sector with almost no competitor looking to dethrone it anytime soon.
The result is that CGC stock is now much more of a stable mainstay, less prone to wild swings both up and down.
Now that doesn’t mean Canopy Growth stock won’t grow fast—far from it. It only means that, on the days when the marijuana industry swings one way or another on the whims of investors and little else, CGC stock will likely be less affected.
So random gains and falls are going to be tempered for Canopy Growth, which is a good thing for investors looking for stability day after day, year after year.
Canopy Growth stock will instead have to see huge gains largely derive from its business savvy and overall industry support. Considering its track record, investors won’t have to wait long before the company is able to score another victory and boost its shares accordingly.
A little bit of a forgotten son over the past few weeks, Hexo Corp (NYSEAMERICAN:HEXO) has been in the shadow of what I consider to be its biggest rival, OrganiGram Holdings Inc (NASDAQ:OGI) ever since the latter announced it was going to list on the Nasdaq.
Both companies are of a similar size and both are very strong marijuana producers in the Canada market. Both are top marijuana penny stocks (in my mind) and both are among the top pot stocks, period.
The rivalry hasn’t manifested in many ways, but I believe that, since the companies have so many similarities, investors are wont to choose one over the other rather than both.
I understand that strategy, albeit I believe it’s misguided. Both stocks are likely to see huge growth in the years to come. After all, both are largely considered undervalued and are some of the few stocks priced at their level while also having a long list of accomplishments.
I’ve long said that these companies are marijuana titans masquerading as penny stocks and investors would do well to take advantage.
That being said, HEXO stock has been in the dumps over the past week, down nearly eight percent. It also fell four percent in early-morning trading today.
This will turn around, however, and I believe that Hexo is simply being hurt by OrganiGram stock’s compelling moves. Once the hype settles, I expect HEXO stock to make a strong recovery.
CGC and HEXO Stock Performances
The performances of CGC stock (black line) and HEXO stock (blue line) over the past week are seen on the chart below.
Chart courtesy of StockCharts.com
The marijuana news today was a mixed bag.
On the one hand, you have projections showing that pot could easily outpace alcohol in the near future and that, in fact, it is already outpacing booze in certain markets.
The marijuana stock market, meanwhile, was a bit of a flop today. While not devastating, we’ve been seeing this up-and-down pattern over the past several weeks and are now playing the waiting game, looking for the return of sustained and steady gains that defined the start of 2019.