Canada is expected to legalize marijuana edibles sometime later in the year. Some marijuana stocks will skyrocket when this arm of the cannabis industry finally comes into play. Two, in particular, spring to mind as potential gainers: Cronos Group (TSX:CRON) (NASDAQ:CRON) and Canopy Growth Corp (TSX:WEED) (NASDAQ:CGC).
Both have been laying the seeds with major deals and expansion plans that should pay-off down the line.
Marijuana Stocks Partnerships
Cronos Group has already doubled its share value since it announced its massive deal with Altria Group (NYSE:MO) in December 2018. Altria put a massive $1.8 billion investment into Cronos and stock soared. At present, CRON stock trades at $29.64 CAD on the TSX. The question is, will this marijuana stock double again?
As analysts at Seeking Alpha put it: "Cronos is a company that I believe is very well-positioned to do well in the current landscape. They now have a major infusion of cash and a major partner."
Altria is one of the world's largest tobacco companies and has brands such as Marlboro under its belt. A huge company to have in your corner, this investment blew Cronos potential in the drinks and edible sector wide open.
Tobacco and alcohol firms are hopping on the cannabis craze and helping to push marijuana stocks skyward. It makes for a perfect business partnership; according to Forbes, alcohol sales have been declining over 15% in states where medical marijuana is permissible. The solution is to evolve.
Bringing years of experience, not to mention, massive revenue to Cronos artillery puts it in a prime position to take over the cannabis drinks, food, and pre-rolled industry. In fact, there's no area that will be left untouched here. That potential shouldn't go unnoticed.
Marijuana Stocks: Canopy Growth Corp
With a major partnership with Constellation Brands (NYSE:STZ), Canopy Growth Corp is one to watch all over in 2019. The company has not been shy about wanting to put its hand into every aspect of cannabis. This means edibles, drinks, creams, you name it.
According to analysts:
"With nearly C$5 billion in cash and cash equivalents on its books as of the end of its latest fiscal quarter, Canopy is, in my mind, the prime candidate to take the lead."
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It's easy to take the lead when you are already the largest cannabis company by market cap. But it's a position that CGC is looking to implement appropriately, especially in the edibles and drinks sector.
At $59.41 CAD per share, this marijuana stock is not cheap. But then, we are dealing with a market leader here who has the vision, financial resources and steps made to take over the very lucrative areas of cannabis. Think pet-care, health-care, cannabis drinks, creams, oils, tinctures. The list is potentially endless.
As analysts continue:
"With Constellation Brands by its side, it’s highly probable that the business will be well positioned in order to capitalize on [the cannabis drinks] trend. The end result [...] should be significant value creation for shareholders."
So there you have two major marijuana stocks that are both in a very interesting phase of development—already taking on the drinks sector, and prepping for the edibles one. Which one would you choose? Do you have your eyes on any marijuana stocks?
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