Cannabis stocks include stocks of companies that manufacture, distribute, or research recreational pot, herbal medicine, or related products.
If you're considering investing in the cannabis industry, the pot stocks below are good candidates.
OrganiGram Holdings
Founded in 2013, OrganiGram (TSX:OGI)(NASDAQ:OGI) is a well-known Canadian-based legal cannabis producer that started out as a medical marijuana specialist but has expanded significantly into the adult recreational use market.
OrganiGram covers several types of cannabis products and their distribution channels, and sells to both retailers and wholesalers in Canada. It also sells medicinal products such as oils, flowers and sprays, recreational products under several brands, and other cannabis products such as edibles. In addition to physical distribution media, OrganiGram also offers its products online and over the phone.
Organigram is expanding its international strategic connections to strengthen its position in the global cannabis industry.
The cannabis company’s revenue grew 128% to $43.9 million in Q2, making it the category leader among cannabis stocks traded on the NASDAQ. The company's net profit has improved, but it has yet to reach profitability. Its net income in the last quarter was C$4.05 million (US$3.6 million).
One of the contributors to OrganiGram’s increased sales is a deal reached in June 2020 that gave it access to the international market. The marijuana cultivator, which started as a producer of medical cannabis, is now expanding in both the medical and recreational markets. Two years ago, the company also signed an agreement to supply dried cannabis flowers to the largest medical cannabis company in Israel. The company's wholesale cannabis delivery service and online sales are growing rapidly.
In addition, SHRED'ems Gummies are a high quality addition to Organigram's SHRED line of products. Edison JOLTS are the first ingestible THC flavored extracts in Canada with a high THC content.
During the first quarter, OrganiGram acquired Quebec-based hash and artisanal cannabis producer Laurentian, an immediately accretive transaction providing the Company with an expanded product portfolio and increased presence in Quebec.
“We are also progressing well with the Laurentian integration. In less than three months we have been able to significantly increase distribution and begin to implement the synergies planned at acquisition. Automation to optimize production is also underway and expected to be complete by the end of Fiscal 2022,” said Beena Goldenberg, OrganiGram CEO.
Green Thumb Industries
Green Thumb Industries (OTCMKTS:GTBIF) is one of the largest multi-state operators in the United States, with a focus on the Northeast. The American company sells different types of cannabis products. Its product portfolio includes raw cannabis flowers as well as processed products such as edibles and concentrates. Green Thumb operates in its market through several brands and sells products in the United States through retail stores. It owns and operates 77 retail stores in 15 US markets, and continues to grow each year. Its national presence serves approximately 50% of Americans. It also expanded its store network in February by opening two new stores in Virginia.
In Q1 2022, Green Thumb's revenue grew 25% year-over-year to $243 million. It should comfortably beat its revenue target of $1.1 billion, given the strong start to the year. In addition, Greenthumb saw its net profit skyrocket to 179% in the first quarter.
Green Thumb is one of the few marijuana stocks that has been consistently profitable for seven consecutive quarters.
The company made several acquisitions last year and is expected to continue to grow its business through organic and inorganic means. With recreational cannabis launching in New York next year and a surge in sales in New Jersey, it could potentially see a massive increase in sales and EBITDA. It generated an impressive $71 million in EBITDA last year, and once the regulatory hurdles are cleared, it can pick up the pace.
“We believe that all our markets will eventually open to adult-use sales—we don’t know exactly when—but we do know that Americans are choosing cannabis for well-being and our trusted family of brands are well-positioned for the future. There is tremendous opportunity in this Great American Growth story, and we believe that the approximately $25 billion legal U.S. cannabis market will have significant growth over the next decade,” said Green Thumb Founder and Chief Executive Officer Ben Kovler.
Trulieve Cannabis Corp.
Trulieve Cannabis (CSE: TRUL) (OTCQX: TCNNF) is a leading cannabis producer and retailer in the United States. It is primarily focused on Florida, where it dominates the medical marijuana market and operates 70% of its outlets. Although it is a medical-only market right now, it is likely to become a recreational market by 2024.
Trulieve accounts for approximately 50% of total marijuana sales in the state and has been profitable since 2017. Revenues and profits have consistently grown in double-digit percentages for several years.
In Q1 2022, Trulieve reported a record revenue of $318.3 million, up 64% year over year and 4% sequentially. Adjusted EBITDA was $105.5 million, compared to an adjusted EBITDA of $100.9 million in the fourth quarter of 2021.
Trulieve reiterated its guidance for 2022 with expected revenue of between $1.3 billion and $1.4 billion and adjusted EBITDA of between $450 million and $500 million. Based on the company's current guidance, it expects to achieve improved performance in the second half of 2022 compared to the first half of 2022.
"We delivered another record quarter while making substantive progress on our plan to optimize assets while preparing for future growth and catalysts. In 2022 we expect our strong balance sheet, access to capital and financial discipline will uniquely position us to capitalize on market opportunities created by the macroeconomic factors impacting our industry," said Kim Rivers, Trulieve CEO.
Last year, the company announced it was acquiring Harvest Health and Recreation for $2.1 billion. With the acquisition, Trulieve has a presence in 11 states. The majority of its footprint is concentrated in three main hubs, including Pennsylvania, Florida, and Arizona. Management notes that volumes increased by 35% during the modernization of Harvest stores in Florida. Trulieve's financial performance should improve in the second half of 2022 as it streamlines operations, launches targeted promotions and realizes synergies from its 2021 acquisition of Harvest.
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