The marijuana industry consists of companies directly related to research, development and distribution of cannabis products, as well as companies that indirectly support these activities. Traditional stock indices like the Nasdaq still feature more companies from the marijuana industry as a growing number of regions around the world legalize marijuana. The number of US states that allow the use of marijuana in one form or another rose to 36 after voters in several states approved marijuana legalization initiatives on their ballots in last year’s US presidential election. Some of the Nasdaq-listed marijuana companies include Tilray Inc. (TLRY) and OrganiGram Holdings Inc. (OGI). Many of these companies have been able to maintain revenue growth despite the COVID-19 pandemic.
Marijuana stocks, as represented by the ETFMG Alternative Harvest ETF (MJ), outperformed the broader market. MJ has delivered a total return of 40.0% over the past 12 months the total return of the Russell 1000 from 37.5%. These performance figures and all statistics in the tables below are as of July 21, 2021.
Here are the top 3 marijuana stocks on the Nasdaq with the best value, fastest growth, and most momentum.
On March 31, 2021, New York passed a law legalizing recreational cannabis, expanding medical use and decriminalizing possession of small amounts of marijuana, among other measures. Not all of these provisions will come into effect immediately and there is not yet a timeline of a date when all of these measures will be fully implemented.
These are the marijuana stocks traded on the Nasdaq exchange with the lowest 12-month trailing price-to-sales (P/S) ratio. For early-stage companies or industries experiencing major shocks, this can be replaced by a rough measure of a company’s value. A company with a higher turnover could eventually make more profit when it achieves or returns to profitability. The P/S ratio shows how much you pay for the stock for every dollar of sales generated.
|Best Value Marijuana Stocks on the Nasdaq|
|Price ($)||Market Capitalization ($B)||12 month ongoing P/S ratio|
|Village Farms International Inc. (VFF)||9.96||0.8||3.5|
|Hydrofarm Holdings Group Inc. (HYFM)||50.23||2.0||3.9|
|Aurora Cannabis Inc. (ACB)||7.52||1.5||5.5|
- Village Farms International Inc.: Village Farms International is a Canadian based agricultural producer. In addition to growing vegetables such as tomatoes, peppers and cucumbers, the company now also produces cannabis. On July 1, Village Farms announced that its cannabis subsidiary Pure Sunfarms can increase production by 50% at its 1.1 million square foot Delta 2 greenhouse facility. The increased production capacity is due to an amendment to the cultivation license made by the regulatory authority Health Canada.
- Hydrofarm Holdings Group Inc.: Hydrofarm Holdings Group manufactures and distributes hydroponic products, including lighting equipment, climate control equipment, garden accessories and related products. The company announced on July 1 that it had completed its previously announced acquisition of Aurora, a maker of organic hydroponic products. The transaction is valued at $161 million.
- Aurora Cannabis Inc.: Aurora Cannabis is a Canada-based, vertically integrated producer and distributor of medicinal cannabis. It engages in cannabis facility engineering, cannabis breeding and genetic research, cannabis and hemp production, and more.
These are the marijuana stocks on the Nasdaq with the highest year-over-year (YOY) revenue growth for the most recent quarter. Rising sales can help investors identify companies that are able to grow their revenues organically or by other means, and find growing companies that are not yet profitable. In addition, earnings per share can be significantly affected by accounting factors that may not reflect the overall strength of the company. However, sales growth can also be misleading about a company’s strength, as growing sales from money-losing companies can be detrimental if the company does not have a plan to become profitable.
|Fastest Growing Marijuana Stocks on the Nasdaq|
|Price ($)||Market Capitalization ($B)||Revenue growth (%)|
|Grow Generation Corp. (GRWG)||41.69||2.5||172.9|
|Village Farms International Inc. (VFF)||9.96||0.8||63.2|
|Cronos Group Inc. (CRON)||7.43||2.8||49.6|
- GrowGeneration Corp.: GrowGeneration operates retail stores for hydroponics and organic specialty horticulture. It offers plant nutrition, farmland, crops, advanced lighting technology, hydroponics and aquaponic equipment and more. While GrowGeneration is not a pure cannabis company, many of its products are used in cannabis cultivation. At the end of July, the company announced two acquisitions of hydroponic garden centers. The first is Aqua Serene, an Oregon-based company with annual sales of more than $14 million. The second acquisition was Mendocino Greenhouse and Garden Supply, a California-based company with annual sales of more than $8 million. The two acquisitions bring the number of GrowGeneration locations nationwide to 58. The terms of both deals have not been disclosed.
- Village Farms International Inc.: See above for company description.
- Cronos Group Inc.: Cronos Group is a Canadian-based diversified cannabis company focused on research, technology, and the manufacturing and distribution of medicinal cannabis products and cannabis oils.
These are the marijuana stocks on the Nasdaq that had the highest total return in the past 12 months.
|Marijuana stocks on Nasdaq with the most momentum|
|Price ($)||Market Capitalization ($B)||12 months sequential total return (%)|
|Grow Generation Corp. (GRWG)||41.69||2.5||431.8|
|Tilray Inc. (TLRY)||14.60||3.9||179.2|
|OrganiGram Holdings Inc. (OGI)||2.62||0.8||89.9|
|ETFMG Alternative Harvest ETF (MJ)||N/A||N/A||40.0|
- GrowGeneration Corp.: See above for company description.
- Tilray Inc.: Tilray is a Canada-based supplier of cannabis products to pharmaceutical distributors. The company is focused on cannabis research, cultivation, processing and distribution of cannabis products. On May 3, Tilray announced the completion of the previously announced merger with Aphria Inc., creating the new Tilray company.
- OrganiGram Holdings Inc.: Canada-based OrganiGram Holdings is a licensed producer of medical marijuana, producing it through a subsidiary. For Q3 FY 2021, ending May 31, OrganiGram reported a dramatically smaller year-over-year net loss on a 12.8% year-over-year increase in net revenue. OrganiGram attributed the results to factors including the growing number of corporate cannabis stores and store reopenings following the COVID-19 pandemic.
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