Are Medical Marijuana Stocks A Good Investment?

With the relatively recent support of the Federal Government and their assertion to legislatively back cannabis legalization by late 2017 or early 2018, Canada’s recreational marijuana industry is conservatively estimated to grow to between $8-20 billion dollars per annum – this facilitation of growth and social acceptability surrounding a more assuredly widespread usage of cannabis will also aid in driving the price of medical marijuana investment stocks higher. According to a study conducted by Health Canada, as of 2002 only 477 Canadian Citizens were legally authorized to possess medical marijuana. By 2014 that number had swelled to 41,384 and by 2020 projections estimate the number rising nearly eleven-fold to a further 450,000 nationwide. Moreover, the medical marijuana industry as an entity is set to be worth $1.3 billion dollars per annum by 2020 – up from $130 million in 2014.

Despite the majority of Canada’s licensed producers still trading on the Toronto Venture Exchange (TSXV) – a public venture capitol exchange for emerging companies – or the Canadian Securities Exchange (CSE), their market growth viability continues to climb. Between 31st December, 2015 and 30th September 2016, the stock valuation for THC Biomed Intl Ltd (CSE:THC), Maple Leaf Green World (TSXV:MGW) and Emerald Health Therapeutics (TSXV:EMH) rose 710.5%, 356% and 282%, respectively. Despite being the top three performers during the above time period, their growth is not an anomaly; many other Canadian licensed producers are turning out similar results.

Canada’s largest player, Canopy Growth Corporation (TSX:WEED), as of 1st February, 2017 commenced trading on the senior equity market, The Toronto Stock Exchange. As of 31st January, 2017, Canopy Growth Corp completed the acquisition of Mettrum Ltd, their merger thereby controlling nearly half of the medical marijuana growth industry in Canada. The rapidly flourishing (medical & recreational) marijuana industry is only poised to develop further and while no stock purchase is without risk, careful, methodical and in depth research could yield significant financial opportunities as the industry moves forward towards both legal and societal acceptance.