Why Are We Due for a Cannabis Stock Rally?
Pot stocks have taken a dive recently due to the COVID-19 crisis but the issues are more systemic than the virus. Why are we due for a marijuana stock rally?
The last twelve months have been an absolute nightmare for cannabis investors but there’s still a ton of potential opportunities out there as the long-term outlook for Cannabis remains as bright as ever. The winners and losers among the bunch are now becoming more and more evident.
We’ll continue to supply you with the research to discern between the two in the coming months. In the following, we’ll discuss the criteria for evaluating these opportunities.
In the meantime, let’s take a quick look to see where things currently stand and offer some insight as to what the future holds for marijuana stocks.
Several top cannabis stocks have taken a beating this past year. Companies like Liberty Health Sciences, Tilray, and Aurora Cannabis, are among many marijuana stocks which are now down 50-90% in value over the past twelve months. The same goes for many cannabis ETFs like ETFMG Alternative Harvest ETF MJ, which represents the overall condition of the entire sector. Overvaluation, long-term operating viability, and the COVID-19 crisis are the main contributing factors to this sector-wide downturn.
Investors were initially attracted to the sector because of its risk/reward potential and many have gotten out of their cannabis stocks altogether. However, the long term outlook for cannabis and hemp companies remains. Forecasts indicate that worldwide cannabis sales will continue to explode over the coming years. Also, much like alcohol and tobacco, cannabis has very consistent demand.
Unfortunately, we’re not out of the woods yet. It’s more difficult than ever for cannabis companies to raise capital given the uncertainty of the sector and the duration and impact of the COVID-19 virus. This certainly has a ripple effect which will encumber growth and expansion in both the short and long term. The virus will likely also delay efforts for new states and countries to legalize — further delaying expansion efforts.
If you’re currently investing in cannabis stocks don’t lose hope. The cannabis industry as a whole still has significant potential and many of the stocks you own will eventually rebound. Don’t dump your shares at this industry low point unless you have to as there’s little risk in holding these companies to see how things shake out. On the same token, don’t necessarily double up on discounted shares either as this can be a risky strategy.
Remember – there will be plenty of losers and only a handful of winners in this space. Stay abreast of company news, financial results, and changes to management. Keep a close eye on company fundamentals and financials. Will companies like Harvest Health have enough cash to weather this COVID-10 storm? Will it have the ability to execute its growth strategy?
For now, the most important thing we can do as investors is to continue to evaluate the best marijuana stock investment opportunities. Watch for the next round of quarterly reports. Continue to monitor the market to see the next buying opportunity which would be precisely when the market dips into another bear leg. The analysts at Cannin will continue to keep you up to date on these opportunities as they arise.
Hang in there. Many of these companies will come back but we must be patient. This industry is still in its infancy and has plenty of room to grow. Remember, there is no shortage of incredible opportunity out there.
Why Are We Due for a Cannabis Stock Rally?
About Cannin: Cannabis and Hemp Investment Experts
Market analysts expect the cannabis and hemp industry will have an annual value exceeding $75 Billion in the next decade. The time to invest in cannabis and hemp stocks is now. Are you looking to buy stock in hemp companies or cannabis companies? Interested in emerging penny pot stock companies? Looking for the best Canadian pot company to invest in?
Cannin is your trusted resource for information about Cannabis and Hemp stock investment opportunities. Our global team of experts evaluates emerging cannabis and hemp companies. We aggregate hundreds of hours of research and provide tips on the best cannabis and hemp stock investments for 2020. We provide the latest marijuana and hemp investment news and analysis.
Visit our site for breaking cannabis investing news and featured companies, sign up for the free Cannin Chronicle or get a free trial of our smart cannabis and hemp stock algorithm to take the guesswork out of profiting from this exciting industry. Predict the price of cannabis and hemp stocks hours in advance with our proven machine learning algorithm. Is it too late to invest in marijuana stocks? No! This is the perfect time to invest.
Profit from the best Cannabis and Hemp stocks – we’ll show you how at cannin.com