Download now: The Downfall of Cable, and the Rise of 5G!

What Can You Expect from Cannabis?

Written by Monica Savaglia
Posted December 10, 2019

A few weeks ago in the U.S., one of the biggest legislative milestones was achieved. The U.S. House of Representatives Judiciary Committee voted 24 to 10 to pass the Marijuana Opportunity Reinvestment and Expungement (MORE) Act, a bill that would legalize marijuana at the federal level. 

Naturally, this vote brought some optimism into the cannabis industry. Marijuana stocks were soaring again. The vote was and is a step in the right direction, but there was one question people were avoiding: When will the legislation go into effect — when will marijuana be legal on a federal level?

Well, that’s kind of a tricky question. While the passage of the MORE Act has been accepted by the full House of Representatives, there still needs to be approval from the U.S. Senate, which is controlled by Republicans. Senate Majority Leader Mitch McConnell has been publicly opposed to the legalization of marijuana in the past. However, he might be in favor if it would ensure that the GOP keeps control of the Senate in the 2020 elections. 

Then there’s the scenario that Democrats gain control of the House and Senate in the 2020 elections. It would be tough for Democrats to gain control of the Senate, but nothing is impossible. There is a lot going on in politics, and there are many factors that could push it either way. Only time will tell.

Big Changes Are Happening for Cannabis Legislation

I don’t think this will be the end of the fight for the legalization of marijuana on a federal level. It has been a highly discussed topic, especially among the 2020 presidential candidates. It's obvious that federal legalization is on the minds of the future leaders, and they know it’s important to the public. 

It has been a tough year for the cannabis industry, and a lot of companies have felt the pains of the industry’s less-than-successful year. But don’t let that keep you away from the opportunities ahead for the industry. 

On December 1, Michigan became the latest state to allow the sale of recreational marijuana. It’s been over a year since the people of Michigan voted for the public referendum, but despite the delay, citizens are optimistic about what this new market will bring their state economy. A recent estimate shows that Michigan’s recreational cannabis market could be worth $1.4 billion to $1.7 billion in annual sales in the next few years. 

The legislation is being passed on a federal level, and states are pushing forward on legalization for medical or recreational — or both. The public is serious about the benefits that marijuana could have on states and the nation as a whole. Pushing forward with legalization is giving the industry momentum. 

Big Changes Bring Big Money Opportunities?

2020 could easily be a big year for cannabis.

Big changes are being made and will continue being made, especially with whatever happens with the U.S. 2020 presidential elections and which political party gains control of the House and the Senate.

If you weren't paying attention to news about marijuana before, then I urge you to start paying attention now. Marijuana is going to (legally) be part of America’s future. Things are happening fast, which is why you need to stay alert and up to date on the latest information on companies involved in the industry. 

So what should you be paying attention to when it comes to investing in cannabis? Well, you’ll need to discover the companies that have a future in this expanding industry. Those companies have a few signs you should be looking for. 

One of the biggest signs you want to look out for is revenue. That probably doesn’t come as a surprise to you. You should know that revenue and revenue growth are what sets the companies that will last apart from the ones that won’t survive. 

You want to see cannabis stocks that are valued at less than $100 million and making money. You want to disregard the companies that are living capital raise to capital raise. The companies that are making money are rare, but these are the ones you want to pay attention to. They have the strength to survive whatever the industry throws at them.

Secondly, you want to see a cannabis company that has diversification. 

A diverse business is going to be a huge asset when it comes to fighting against any kind of decline in the industry. It helps the company grow its efforts across the board and not be dependent on one part of the industry. Cannabis businesses that work from cultivation and extraction to manufacture and that sell a variety of products (vape cartridges, edibles, oils, and topical creams) have a leg up on other businesses that are focused on one area only.

What Do You Have to Lose?

My colleague Alex Koyfman has been watching this industry for a while now, and he has some incredible insights into the industry. He has identified a cannabis company that possesses the characteristics to keep it alive and surviving during possible hardships in the industry. 

You know cannabis will be part of our future, one way or another. It’s up to you to take the next steps to make it a part of your future. That’s why you shouldn’t waste any more time wondering what could be and instead find out more about the cannabis company Alex has uncovered.

Until next time,

Monica Savaglia Signature Park Avenue Digest

Monica Savaglia

Monica Savaglia is Wealth Daily’s IPO specialist. With passion and knowledge, she wants to open up the world of IPOs and their long-term potential to everyday investors. She does this through her newsletter IPO Authority, a one-stop resource for everything IPO. She also contributes regularly to the Wealth Daily e-letter. To learn more about Monica, click here.

Buffett's Envy: 50% Annual Returns, Guaranteed