Your All-Purpose Pot Report (and a New Ticker)
Pot stocks kicked off to a great start in 2019. Over the course of Q1, the North American Marijuana Index rose over 29%.
For a bit of context, the S&P 500 is up over 15% and the Dow is up almost 13%. Don’t get me wrong… This is one heck of a performance for the major averages. But they pale in comparison to 29% in gains for the marijuana sector.
Pot stocks are beating the major averages once again.
You should consider this a preview of what’s to come for the legal cannabis market for the rest of the year as well. But with this uptrend, it’s important to note the gains won’t all come at once and the path up won’t always be a straight line.
In fact, we’re facing some strong sideways action in pot stocks right now.
Here’s what you need to know and do to keep raking in the cash.
Pot Stock Earnings (Not What Most Expected)
Worldwide cannabis spending is growing at an incredible rate. Experts project that annual revenue could quintuple over the next 10 years.
Long term, there’s no better place to be than in the marijuana industry. But today many folks are most likely seeing their holdings dipping.
Bluntly speaking, cannabis earnings are pretty lackluster so far. As the industry matures, Wall Street is paying closer and closer attention to bottom-line numbers. Traders can’t just bank on speculation anymore.
Revenue is shooting up, up and up, but we’re also seeing many marijuana companies burning through cash like nobody’s business. Expenses these companies are dealing with include:
- Facility expansion
- Branding and marketing
- Research and development
- Production diversification
- Mergers and acquisitions.
Long term, these are all good things, but it does mean many of the most actively traded pot stocks were operating at a loss last quarter. Here’s a quick synopsis:
Source: SEC, Sedar, Motley Fool
The moral of the story is choosing pot stocks today is a lot more complicated than just throwing a dart at the wall and making money.
But that’s why I’m here for you. And speaking of which, here’s a hot marijuana play for you to consider today.
This Pot Stock Is Red-Hot
Last year saw a brand-new wave of marijuana legalization here on the East Coast and in the central states. This put one company squarely in my sights.
Green Thumb Industries (OTCBB: GTBIF) is a leading medical cannabis cultivator perfectly positioned to create a lasting foothold in these new regional marijuana markets.
We first suggested taking a swing on GTBIF back in December… and man, did it turn out to be a great hedge for the winter sell-off. Since then GTBIF shares are up a whopping 61%
And here’s why I expect even more gains. For one thing, Massachusetts and Michigan are two states where GTBIF is developing a strong presence. They are in on the ground floor, and a lot of their revenue from these markets is not realized yet.
I think GTBIF has a lot more room to run. And I’m not the only one…
Back in February I noted Beacon Securities analyst Russell Stanley put his new price target for GTBIF at C$44.00 (U.S. $33.20), as reported by a recent Cantech Letter.
This would mean a potential upside of over 130% for Green Thumb shares since we mentioned jumping on this stock back in December.
Please just keep in mind this is not an official recommendation, and while we believe strongly in the fundamentals of GTBIF, we will not be exclusively tracking this stock. Please make sure you conduct your own research, and as always never bet more than you can afford to lose.
But with that said… GTBIF is up 61% in gains right now, meaning we’re only halfway to Stanley’s new price target.
I expect many more profits for GTBIF owners this year.
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