The cannabis stocks that made bank in 2019

Published Jan 24, 2020 10:00 a.m. ET
iStock / Adam Simpson

The second-year ended in disappointing cannabis stock results in the USA because the market dropped by approximately 32% in 2019. This reduction came after a 54.9% decline in 2018.

Canadian based Aurora Cannabis had devastating losses in the second quarter. The damage totaled around 237.7 million Canadian dollars, which is equal to 25 cents per diluted share. This is in comparison to the 2-cent profit per share or translated to $7.7 million the previous year. Aurora's stock price is not for the risk-averse investor. However, currently, the revenue growth, along with the market expansion, should be a positive side for 2019 and years to follow.

Canopy Growth has a new CEO, David Klein; They are hopeful he will bring financial discipline to the company. After a tumultuous 2019 year for cannabis stocks, Canopy Growth is forecasting 2020 as a much better year than 2019 for investors in Canopy Growth stock.

The past performance of cannabis stocks does not necessarily guarantee future results. With that said, there were a few stocks that did fly in the sky, as they rocketed ahead by more than 100%. Investors are questioning if they have enough fuel to continue in 2020 to show such results.

Here are a few of the cannabis stocks of 2019 that are worth mentioning

HEXO: Thanks to enthusiastic investment bank analysts, this Canadian cannabis producer had reason to be happy. The one-million-square-foot greenhouse has achieved the first harvest. The medicinal products made from the flower they grow sold under the name Hydropothecary brand. The joining of the company to Molson Coors is poised to produce products that meet the Health Canada requirements.

OrganiGram Holdings: This company did make a profit and displayed the needed skills to run an efficient, profitable cannabis operation with increased sales. It appears that this company is very close to being accepted as sustainable with positive cash flows.

Curaleaf Holdings: This is a US cannabis company that is under the control of a Russian oligarch. The focus of this company was on limited and strict, highly populated states that have severe and limited rules on the east coast of the states. The majority of these companies’ dispensaries are in the united states whose laws have requirements that cannabis needs to be cultivated, packaged, processed and sold by the same business.

Innovative Industrial Partners: This company reported profit margins of more than 51%. The company focus and operates as a real estate investment trust (REIT) they focus on leasing properties to the medicinal cannabis industry. The company leases 100% of the properties they own (19).  The first quarter of the year 2019, saw the company increase its net rental revenue by 146%, along with earnings increases of 444% year after year.

Constellation Brands: The 38% ownership with cannabis producer Canopy Growth has been positive for Constellation, Canopy Growth is struggling. The profit margin for Constellation Brands tops 42%. The big boys at Constellation see the company's expansion into the cannabis industry will be the path to more significant profits. In the year to come.

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