Cannabis. Cannabis. Cannabis. What a difference a few years makes!
Flash back to even the beginning of 2014, and it was still tough to be a “medical marijuana” company. Look
forward, and these companies are identifying themselves more and more as simply “cannabis companies” – as legalization starts to sweep across North America.
The medical marijuana market was a large-but-finite space. Medicinal marijuana has now been targeted at more than 17.4 million treatable conditions, meaning the potential of 10’s of millions (if not 100’s of millions) of potential users of medicinal marijuana just across North America.
[taken from Canabo Medical
presentation]
(click to enlarge image)
The potential of the medical marijuana market alone was tremendous. However, the potential size of this market still pales in comparison when considering marijuana as a
legal recreational drug.
The global tobacco industry recorded sales of
just under $700 billion in 2015. The global alcohol industry registered sales of
$1,198.6 billion ($1.2
trillion) in 2014, and this figure was expected to grow to $1,451.6 billion by 2020. As a
legal recreational drug, marijuana will undoubtedly take significant market share from both of these industries.
Revenues for the
entire global
pharmaceuticals industry ($1,072) are less than revenues from the alcohol industry alone, and medicinal marijuana would/could never amount to more than a small piece of that pharma pie. Conversely, in the
$2 trillion global tobacco & alcohol market, the potential for claiming market share is essentially unlimited.
Canada’s federal government is now committed to full legalization. In the United States, while resistance remains to cannabis legalization at the federal level, rapid movement by increasing numbers of U.S. states towards full legalization means that this federal obstructionism could soon be moot.
Cannabis is now recognized as a legitimate growth industry. With massive, structural unemployment across North America, the employment potential of increased activity from the cannabis industry means that provincial and state governments literally can’t afford to be the last jurisdictions to jump on the legalization bandwagon.
The rapidly changing legal/political atmosphere for cannabis corporations has occurred so quickly that the management of many of these companies has gotten giddy as they contemplate the “growth” potential for this now-legal crop. Indeed, legal cannabis companies have been practically tripping over each other as they trumpet the movement toward decriminalization/legalization.
The investor “buzz” around pot has been at least as intense as the jockeying for position among the companies themselves. On stockmarket bulletin boards, cannabis companies have become the new market darlings. News releases from these companies are gobbled up, digested, and discussed enthusiastically in one bullboard after another.
While this is still a relatively new industry, competition is already intense among a plethora of companies looking to be first/best/fastest in building their “growth” business. Many of these names will already be familiar to the Stockhouse audience.
Arcturus Growthstar Technologies Inc. (
CSE: AGS,
OTCQB: AGSTF,
Forum), Aurora Cannabis Inc (
TSX: V.ACB,
OTCQB: ACBFF,
Forum), Canabo Medical Inc. (
TSX: V.CMM,
OTCQB: CAMDF,
Forum), Canopy growth Corporation (
TSX: CGC,
OTCQB: TWMJF,
Forum) Emblem Corp. (
TSX: V.EMC,
OTCQB: EMMBF,
Forum), Finore Mining Inc. (soon to be “Kushtown”) (
CSE: FIN,
OTCQB: FNREF,
Forum), iAnthus Capital Holdings Inc (
CSE: IAN,
OTCQB: ITHUF,
Forum), Liberty Leaf Holdings Ltd. (
CSE: LIB,
OTCQB: WSSRF,
Forum), Namaste Technologies Inc (
CSE: N,
OTCQB: NXTTF,
Forum), Organigram Holdings Inc. (
TSX: V.OGI,
OTCQB: OGRMF,
Forum), Veritas Pharma (
CSE: VRT,
OTCQB: VRTHF,
Forum), and Vodis Pharmaceuticals (
CSE: VP,
OTCQB: VDQSD,
Forum) are just some of the names looking to rise above the pack in this sector.
A large number of still-small corporations are chasing pieces of a
very big pie, which seems to be getting bigger literally by the day. For all the investors who have bought into the cannabis story, 2017 is going to be “the Year of Pot”.
However, for investors who are already looking for the
next story in the cannabis space, some are already looking at hemp – as food. Cannabis, in its sub-species as marijuana, offers its medicinal users a wide array of medicinal benefits and symptomatic relief, while also providing a “buzz” for its recreational users. Hemp-as-food offers the most nutritious food product available, and companies like Naturally Splendid Enterprises Ltd. (
TSX: V.NSP,
OTCQB: NSPDF,
Forum) are already looking to capitalize on the food potential of this miracle plant.
Many investors want to have a “green” component in their portfolios. For such people, it’s hard to go wrong with cannabis.
FULL DISCLOSURE: Arcturus Growthstar Technologies Inc., Canabo Medical Inc., Emblem Corp., Finore Mining Inc., iAnthus Capital Holdings Inc, Liberty Leaf Holdings Ltd., Organigram Holdings Inc., Veritas Pharma, Vodis Pharmaceuticals, and Naturally Splendid Enterprises Ltd. are paid clients of Stockhouse Publishing.