Cannabis stocks have been flying in the market as of late. Aside from a day of profit taking yesterday, the past month has been overwhelmingly strong. We’ve been tracking Cronos Group Inc (NASDAQ: CRON), Tilray Inc (NASDAQ: TLRY) and Canopy Growth Corp (NYSE: CGC) lately, all of which are seeing gains today. In fact, the stocks are up 10.44%, 18.90% and 5.46% respectively in today’s session alone. So, what’s the deal?
It All Has To Do With Canada
If you’re a cannabis stock follower, chances are that you already know what’s going on in Canada. However, for those of you who are new to the space, Canada recently announced the results of a vote surrounding recreational cannabis. The results of the vote make Canada the second nation in the world to legalize the plant for recreational use.
The recreational cannabis market is set to launch in Canada on October 17, 2017. Of course, the market represents an incredible revenue opportunity. Some estimates suggest that the value of the market will be between $4 billion and $6 billion in the first year.
With so much revenue up for grabs, cannabis growers throughout the region are working to take their slice of the pie. Many of them, including CRON, TLRY and CGC have announced supply agreements to bring adult-use cannabis to Canadians. In fact, Cronos has announced agreements that cover more than 50% of the Canadian population. Tilray has gone far and obove that with agreements representing more than 70% of the population.
Nonetheless, if you’re wondering why pot stocks are climbing, you have your answer. In just over a month, Canada will legalize cannabis for adult use. This legalization will likely lead to a flood of revenue that investors are already starting to bank on.
Looking Beyond Canada
There’s no question that Canada is a big story in the marijuana space at the moment. But that’s not where the buck stops. The truth is that now may be the perfect time to get involved in these stocks as mindsets are changing surrounding pot.
In fact, the tides are changing right here at home. In the United States, 30 states have legalized the use of cannabis as a medicine. On top of that, 9 states and Washington D.C. have legalized the recreational use of the plant. As the tides change, opportunities will emerge for cannabis growers like CRON, TLRY, CGC and many others!
Pot Investors Are Onto Something
The key takeaway here is a simple one really. While cannabis investments have been looked upon as highly speculative in recent years, the speculation is going away. Today, we’re seeing a wide-spread change of attitude toward cannabis. As a result, laws surrounding the drug are changing around the world.
Canada’s new recreational cannabis market will open the doors to quite a bit of revenue for cannabis companies. However, this is likely to be the tip of the iceberg. At the end of the day, as successful cannabis rollouts take place around the world, more regions are likely to follow. As such, those who are in on cannabis stock at the moment are likely onto something big!