Following the news of Canada finally legalizing cannabis use in the country, stocks in its industry skyrocketed amid the addition of more stock listings.
On June 20, Canadian Prime Minister Justin Trudeau announced that the legalization of marijuana for recreational use will take effect on Oct. 17. According to Investor’s Business Daily, Canada is now the second country that has permitted the recreational and medical use of the said drug worldwide; Uruguay takes the achievement of being the first.
The date is stated to be later than what the Canadian government originally proposed, CBC News reported. However, Trudeau explained, “One of the things that we heard very clearly from the provinces is that they need a certain amount of time to get their brick-and-mortar stores—their online sales—ready. Producers need time to be able to actually prepare for a regimented and successful implementation of the regime…This is something that we want to get right.”
After the said news, stocks of many cannabis companies rose, with Canopy Growth and Cronos Group receiving respective increases of 6.4 percent and 5.25 percent. In addition, the stocks of Aphria and GW Pharmaceuticals bumped up, with the former gaining a 4.2 percent increase and the latter earning 2.4 percent more, per Fortune.
As what Investor’s Business Daily reported, in terms of exchange-traded funds, ETFMG Alternative Harvest increased by 2.35 percent while AdvisorShares Vice ETF added 0.7 percent.
The legalization in the said country also prompted some companies to make some big moves. One company is Tilray, which filed an initial public offering last Wednesday. It is also planning to file Class 2 shares on the Nasdaq, with TLRY as its ticker. Even a magazine focused on marijuana called High Times is aiming to file on the Nasdaq within the year.
With Canadian marijuana stocks now soaring, investors turn their eyes to the U.S. The country also has made progress in the drug’s legalization, with some states such as Alaska, California, Colorado, District of Columbia, Maine, Oregon, and Vermont, among others, already legalizing both the medical and recreational use of marijuana. What this indicates is that cannabis companies in the U.S. can also experience surges in their stocks once further progression in the legitimation has been reported.
In the earlier Fortune article, the North American Marijuana Index increased 2.25 percent on June 20. The said stock index currently monitors a total of 41 companies, and its market value is recorded to be in excess of $36 billion.
Additionally, a report recently detailed that the medical cannabis market in the U.S. is forecast to reach $19.48 billion by 2024. Aside from the health benefits, the legal situation in states like Colorado and California also contributes to the growth in the market and the demand for medical marijuana in the nation.
In the past, the medical use of cannabis was plagued with various issues, and some of these issues include having no guidelines concerning the amount patients should take and the improved accessibility leading to more instances of abusing the drug. But all that seems to have changed when people start to notice the health benefits more than these controversies.
POTN poised to take investors up high in success
Now, with the new era of the cannabis industry in the horizon, investors look for possible stocks in the U.S. to add to their portfolios in preparation for the possible upsurge when more states accept the drug. One company they should consider, especially if they are concerned about returns on investment, is PotNetwork Holdings, Inc. (OTCMKTS:POTN).
POTN is considered to be a leader in the cannabis industry, particularly in its sector centered on cannabidiol (CBD). The company is focused on the research and development of CBD products, which its Diamond CBD subsidiary distributes.
What makes the two companies a standout among competitors is their exceptional performance when it comes to revenues and their continuously expanding selection of premium products.
POTN announced last May that its sales from the period of May 1 to 27 added $669,000, thanks to Diamond CBD. Comparing to the online sales last year, it indicated an astounding 639 percent increase. Looking at the numbers from May 2017, online revenues on the same month this year is 1,000 percent higher.
The company also released its consolidated financial statements for 2017 back in April 2018, which elaborated that POTN’s revenues last year were worth $14.49 million and its gross profits were recorded at $5,180,865.
Following the statements’ publication, POTN’s board of directors has decided to commence its preparations to file a Form 10 with the Securities and Exchange Commission (SEC) within this month.
Filing a Form 10 is an essential step for POTN to finally be considered as a fully reporting SEC company. It would also show that the company is serious in its efforts to improve its transparency for the sake of its investors. Also, the firm can attract more investors when it successfully completes such action because of improved visibility.
Things are looking good for the cannabis industry now that more and more places are starting to have a change of heart toward the drug, and with the shift in the regulations, POTN is one great company deserving of the success it receives and will further acquire.