It’s been an up-and-down year for the cannabis stock market as the panic over COVID-19 has sent many investors back to the sidelines, despite several of the sector’s markets reaching new highs at the start of the pandemic. Even though multi-state operators are losing value at an astonishing rate, the Canadian industry continues to reach new heights thanks to a booming retail market. But that doesn’t mean that everyone north of the border is having all of the fun.
At first glance, several small-cap stocks in the cannabis sector appear to be doing poorly this year, as various industry and supply concerns have shot down their stock prices. The overall economic downturn has left much to be desired when it comes to the pot stock market in general. But for those investors that don’t mind a little risk, there would appear to be a significant upside.
Valuations are beginning to bounce back in the US cannabis stock market as companies in the mainland start focusing on the fundamentals. And with marijuana now declared an essential service in most states where it is legal, investors have a prime opportunity to play the market and turn things around by the end of the year. There’s a lot of positives in the current US pot stock market.
With a little patience and the right eye for risk, investors can recoup their early year losses. These three US cannabis stocks are poised for a rebound in 2020.
The grandaddy of cannabidiol sells more CBD
Charlotte’s Web is the patriarch of the CBD industry and, if the company continues to hold onto the fundamentals, they will retain their rightful place on top for the rest of the year. As The Motley Fool recently noted, the premiere CBD company is killing it in the retail game with over 21,000 locations selling their products. In the last quarter alone, they added thousands of drug stores, pet stores, and other outlets to their stable.
Better still, Charlotte’s Web is flush cash, making them the perfect target for end-of-year investors right now. In the first quarter, they brought in over $21 million in cash and have over $53 million in reserve. With their new topical subsidiary Abacus Health, they now own 33 percent of the cannabidiol industry.
Surpassing $100 million in revenue
Massachusetts-based company Curaleaf is having a big year, with the company expected to surpass $100 million in revenue in the second quarter, according to Forbes. Moreover, with their recent acquisition of cannabis operator Grassroots, they now operate 88 dispensaries in 23 states. It’s an impressive amount of growth at a time when most companies are just trying to stay afloat.
And that’s not all. Curaleaf recently closed its acquisition of Cura Partners in February, which will help the company bring the popular Select brand from the West Coast to the greater United States. In Q1, they saw sales over $96 million, representing a 174 percent year-over-year growth, making this a must-buy for anyone interested in the US market.
A US company goes north
One US company is making waves for a deal its made in Canada. Village Farms International owns 58.7 percent of Canadian producer Pure Sunfarms according to The Motley Fool, a company that brought in $123 million in revenue in the first quarter of last year. Retail branded sales jumped by 179 percent.
Most importantly, the company is profitable, making it an excellent investment in the US market, especially for those investors looking to broaden their horizons across the border. And, they recently closed $8.6 million in new funding.