As the cannabis stocks are booming, investors are asking “How to invest in cannabis stocks?” Cannabis stocks seem to be in the headlines everywhere, the biggest news as of late had to do with the MedReleaf acquisition, as reported by Forbes, “Aurora Cannabis acquired MedReleaf for CA$3.2 billion – $2.3 billion in U.S. dollars.” This, the largest cannabis acquisition to date, created a company capable of producing 570,000 kilograms of high-quality cannabis per year at a cost of below $1 per kilogram.”
These numbers are astonishing, but they have also become the new norm in cannabis investments; multi-billion dollar deals with mega players and can you believe their cost at a $1 per kilogram!
So investing should be easy, right? Well maybe, if you are thinking long term. I think this market will shape up to be similar to the Detroit’s “Big Three” where the cannabis industry will probably be dominated by some big players like Aurora Cannabis (ACBFF), Canopy Growth (CGC), the Cronos Group (CRON), and Tilray (TLRY). These guys are shaping up to be around for the long term, but who knows who will be the last man standing as mergers and acquisitions are part of the daily life here in the cannabis space.
With things counting down to Canada’s legalization on October 17, you can expect further market volatility. If history repeats itself, I think you will see a lot of similarities to the dot-com era longer, the market will be on shaky ground, only to settle in six months to a year. Currently, there are some LPs that distressed and are being gobbled up for a nice price by a bigger fish. Over-evaluation is also a big part of this industry, and make sure when it comes to financial statements that the numbers add up, so make sure you do research thoroughly!
On a positive note, as these companies grow amalgamation wise, so do the services and products leaving each company in a dynamic position, for further growth. One such company is Green Growth Brands (GGB), with their headquarters in Columbus, Ohio, they are a lifestyle-oriented, and consumer products company that celebrates health, wellness, and happiness. GGB focuses on the medicinal and recreational use of cannabis and CBD in the U.S. and Canada.
Learn more https://www.greengrowthbrands.com/