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The latest news in cannabis stocks

Published Jan 15, 2023 10:00 a.m. ET
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Cannabis stocks might not be gaining in terms of financial value just yet, but you might be happy to learn that some experts are predicting a completely different outlook in 2023. Investors with a handful of low-value pot stocks should hold steadfast because big changes are coming that could mean more money in your pocket.

Losses

In 2022 cannabis stocks plummeted by 70%, a high number when you consider the 20% drop experienced by the market. Sadly, growers in both Canada and the US are having a hard time between low retail pricing, minimal capital, and continuously looming federal restrictions in America. However, in the next year or two, smart operators are expected to gin investors and consolidate, which could change the game completely according to some analysts.

Popular cannabis stocks

Some of the most popular pot stocks among investors are the bigger US-based chains like Curaleaf Holdings (ticker: CURLF), Green Thumb Industries (GTBIF), Cresco Labs (CRLBF) and Trulieve Cannabis (TCNNF). They’ve maintained interest even through last year's losses, but now that those companies are valued so low, some investors are wondering whether it’s worth keeping these additions in their portfolios.

Still many stock analysts remain convinced that state-licensed cannabis companies will continue to grow with larger profits as more states join the 21 that already allow recreational sales.

Changes by government

Kinloch

Last year ended on a low note after Congress’s highly controversial Omnibus Spending bill omitted a measure to allow federally illegal operators to use the services of federally regulated banks. Also, despite massive losses, 2022 was still a year full of progress within the industry, as President Joe Biden began asking federal agencies to give recommendations on whether or not marijuana should be rescheduled as a less-serious drug under federal law in the spring.

Rescheduling cannabis would stop short of full legalization, but it would still remove some of the most onerous burdens from the state-licensed producers. Biden is expected to propose rescheduling cannabis at some point before the 2024 election. By that time, a few of these American operators might also get listings on Toronto’s TSX exchange which would open their weed stocks to potential ownership by the biggest institutional investors.

Some experts are also suggesting that Congress may close a loophole in the 2018 law that allows US companies to grow and sell help, a type of cannabis that is used in the making of non-intoxicating pain-reliving CBD products, as well as building materials like textiles, because we now know that, legally cultivated hemp contains small amounts of other intoxicants such as Delta 8, or THC-0 products that have become wildly popular with both recreational and medicinal consumers. It’s quite likely that Congress will limit sales of these hemp extracts. The sale of these extracts may be more limited, while America eases its rules and regulations surrounding cannabis-derived options.

As restrictions are lifted off licenses for cannabis sales in the coming months, the global industry will begin to take shape, and this is when investors with pot stocks will finally see a payoff. So, if you can afford to hold the line, and wait out this transition, we highly recommend waiting until the tables turn, and green companies garner the ability to grow and prosper.

Why now is the perfect time to invest in US cannabis stocks
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