Are These Marijuana Stocks To Buy Or Avoid Right Now?
If you’re looking for marijuana penny stocks to buy right now, you’re not alone. Late last week a bombshell headline shot some adrenaline into the cannabis sector. Whether it was Canadian marijuana stocks or U.S. pot stocks, a sector-wide move was unmistakable. So what was the root cause? Was it a big earnings beat by one of the “Big 10”? Did a major, multi-national brand buy into the cannabis arena? Did another state legalize marijuana?
You may think it had something to do with the above, however it was slightly different. While this was already announced earlier in the year, more clarity was given late last week. The U.S. House of Representatives is planning to vote on the MORE Act in the first week of December.
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This is short for the Marijuana Opportunity, Reinvestment, and Expungement Act. Ultimately, the goal is to decriminalize cannabis and expunge convictions for non-violent cannabis offenses. The latter have prohibited many Americans from getting jobs and applying for credit and loans among other things.
Marijuana Penny Stocks, The MORE Act, & The Future Of Cannabis
In November of last year, the MORE Act was passed by the House Judiciary Committee. It has gained a bit more attention and bipartisan support this past summer. A vote on the bill by the full House was first scheduled for September. Lawmakers delayed this in lieu of focusing on passing additional coronavirus relief legislation.
House Majority Leader Steny Hoyer (D-MD) said the chamber will take up the MORE Act some time between Wednesday and Friday. The House is set to be in session Dec. 1-4 and Dec. 7-10, which would encompass that original timeframe.
Further to this, one of the key highlights of the Biden-Harris campaign trail was a plan for U.S. federal cannabis legalization if elected. If that is the case, U.S. marijuana stocks may be something to take notice of and one ETF has established itself as the standout when it comes to U.S. based marijuana stocks to invest in, AdvisorShares Pure US Cannabis ETF (MSOS ETF Report). While the ETF invests in many U.S. marijuana stocks, there are several penny stocks on the list. Here are the top 5 US marijuana penny stocks based on holding percentage in the ETF as of 11/27/2020.
Top 5 U.S. Marijuana Penny Stocks To Watch
- Harvest Health And Recreation (HRVSF Stock Report)
- Columbia Care Inc. (CCHWF Stock Report)
- 4Front Ventures Corp. (FFNTF Stock Report)
- Planet 13 Holdings (PLNHF Stock Report)
- Jushi Holdings Inc. (JUSHF Stock Report)
Top US Marijuana Penny Stocks To Watch #1: Harvest Health And Recreation
If you’re looking for marijuana penny stocks on Robinhood to buy, you might have a pretty short list. As you can see, the top 5 marijuana stocks under $5 based on AdvisorShares’ holdings are all on the OTC. The main reason for this has to do with the main listings for these stocks is on a foreign exchange. They are dually listed in the U.S. with an OTC listing (for now). Will the potential passage of the MORE Act change this? Time will tell. However, this is the case right now.
Harvest Health And Recreation has been one of the more active names to take note of this year. With Arizona’s latest decision on cannabis, Harvest’s home state has brought new opportunities for the company’s expansionary efforts. This month, Harvest showed its hand, so to speak after reporting the latest 3rd quarter results. The results were strong enough to signal optimism for some analysts. This included Cantor Fitzgerald who maintains a Neutral rating however, it boosted its target to $2.10.
Third-quarter revenue was $61.6 million, up 86% from the third quarter of 2019 and 11% sequentially. Adjusted EBITDA was $10.5 million, compared to $4.1 million in the second quarter of 2020. What’s more, is as of September 30th, Harvest owned, operated, or managed 37 retail locations in seven states. This included 15 open dispensaries in Arizona. Right now, HRVSF stock takes up 4.24% weight in the AdvisorShares Pure US Cannabis ETF.
Top US Marijuana Penny Stocks To Watch #2: Columbia Care Inc.
Usually, we discuss penny stocks with higher levels of volume. This is typically for no other reason than to discuss highly active stocks offering greater liquidity. However, that factor of “liquidity” is subjective to each trader’s size and style. In this case, Columbia Care hasn’t been one of the marijuana penny stocks on our lists. But based on the weighting in the AdvisorShares Pure US Cannabis ETF, it could be something to note. Based on data from November 27th, CCHWF stock takes up 4.21% of MSOS.
Since mid-May, the marijuana stock has actually climbed significantly higher. Some days it wouldn’t trade more than 10,000 shares. However, this didn’t stop the pot stock from extending a 150%+ move. The 4th quarter has been a much more active one for CCHWF. Now we’re seeing it trading north of 1 million shares within a day. While this isn’t as much as many of the other pot stocks, it is something to factor in.
If you’ve never heard of Columbia Care before, this might become an eye-opener. Columbia has licenses in 18 US jurisdictions and the EU. It currently operates 100 facilities including 76 dispensaries and 24 cultivation and manufacturing facilities. Its products include flower, edibles, oils, and tablets. Columbia also manufactures popular brands like Amber and Platinum Label CBD. This has helped the company realize a solid year this year. Record Q3 combined revenue of $54 Million resulted in an increase of 64% quarter over quarter and 145% year over year. The company also closed strategic deals in California and Colorado with acquisitions of Project Cannabis and The Green Solution.
Top US Marijuana Penny Stocks To Watch #3: 4Front Ventures Corp.
4Front Ventures Corp. is in the same situation as Columbia Care. It’s a relatively thinly traded cannabis stock that has experienced more momentum in Q4 this year. Similarly, even with this as the case, FFNTF stock has climbed much higher over the last few months. Since late April, this is another one of the marijuana stocks climbing triple digit percentage points. 4Front stock is up 290% between April 23rd and Black Friday. This saw shares climb from a low of $0.20 to closing highs of $0.78 on Friday. Currently, 4Front takes up 2.83% of the AdvisorShares Pure US Cannabis ETF.
Something to keep in mind especially this week is 4Front’s earnings date. As we’ve seen, earnings can pose huge scenarios of high risk. Obviously, if a company reports favorable results, the market tends to respond in kind. Negative results tend to do the opposite. What we can saw right now, however, is that the last quarter may have been one of more a recovery quarter. Due to the set-backs from coronavirus restrictions, the company had to adjust its operating strategy. Furthermore, the company has used the time to focus on expansion.
In its last quarterly update, Leo Gontmakher, CEO of 4Front explained the company’s gameplan. “Our cultivation/processing facility expansions in Massachusetts and Illinois as well as our second Illinois retail location are on-track for end of year completion. We continue to execute on our plans to flip to cash flow positive during the third quarter and have set the stage to exit this year in a position to drive meaningful operating leverage in our business. We are proving that our success in Washington can be replicated in every state in which we operate and are extremely confident in how the company is positioned as we enter this new season.”
Top US Marijuana Penny Stocks To Watch #4: Planet 13 Holdings
Planet 13 Holdings has become one of the popular marijuana penny stocks to watch in 2020. Not only is it up in a big way, year-to-date, since the March sell-off, but PLNHF stock has also seen a huge recovery. March 19th, the pot stock hit a 2020 low of $0.63. This past week, shares hit a fresh, all-time high of $4.69. While it is 4th on the list of marijuana stocks in the U.S. cannabis ETF, MSOS, it is one of the more active compared to some of the others. Currently, Planet 13 takes up 2.45% of the AdvisorShares ETF.
It’s flagship location in Las Vegas has been described as a “must see” for cannabis enthusiasts. Encompassing an entire compound, its Planet 13 location is the “candy shop” for retail consumers. While COVID-19 might’ve become a hinderance to many retail businesses, Planet 13 has managed to not only weather the storm but realize growth based on its latest quarterly results.
Revenues were $22.8 million as compared to $16.7 million, an increase of 36.5%. Furthermore, net income before taxes of $3.4 million as compared to a net income of $0.3 million in last year’s quarter. The company also finished the quarter with $56.8 million in cash as compared to $12.8 million the year prior.
“We are excited to leverage our knowledge and experience from Nevada to California , with the opening of our new dispensary in Santa Ana in 2021 – the world’s second largest dispensary. Planet 13 is well capitalized, and we look forward to executing on future expansion into other major growth markets.”
Bob Groesbeck, Co-CEO, Planet 13
Top US Marijuana Penny Stocks To Watch #5: Jushi Holdings Inc.
Jushi Holdings Inc. rounds out the list of top 5 US marijuana stocks to watch based on the MSOS ETF. It’s weighted at 2.22% of the fund and similar to most names on this list has had a great 2020 so far. With active and in-progress operations in Illinois, Ohio, Virginia, Pennsylvania, New York, Nevada, and California, Jushi has focused on an expanded footprint in the U.S.
In its recent quarterly report, Jushi showed its strength this year. Total revenue increased 67% sequentially to $24.9 million. The company also recorded an adjusted EBITDA of $1.9 million. This was a $3.1 million improvement compared to the second quarter of 2020.
This coming month, the company participates in several industry conferences. These include the Cowen and Cantor Fitzgerald investor conferences. Furthermore, the company’s majority-owned pharmaceutical processor permit holder Dalitso LLC recently began operations at its cultivation, manufacturing, processing, and retail facility in Manassas, Virginia. Its retail brand, BEYOND / HELLO, begins medical marijuana dispensary sales this week. This marks the company’s 12th retail location nationally and the first of six dispensary openings for Jushi in Virginia.
Top 10 U.S. Marijuana Penny Stocks In AdvisorShares Pure US Cannabis ETF
- Harvest Health And Recreation (HRVSF Stock News)
- Columbia Care Inc. (CCHWF Stock News)
- 4Front Ventures Corp. (FFNTF Stock News)
- Planet 13 Holdings (PLNHF Stock News)
- Jushi Holdings Inc. (JUSHF Stock News)
- Greenlane Holdings Inc. (GNLN Stock News)
- cbdMD Inc. (YCBD Stock News)
- Zynerba Pharmaceuticals Inc. (ZYNE Stock News)
- Acreage Holdings (ACRHF Stock News)
- Vireo Health International, Inc. (VREOF Stock News)
These aren’t the only marijuana penny stocks in the AdvisorShares Pure US Cannabis ETF. However, the above are the top 10 US marijuana penny stocks by weight in the ETF. What’s more, is that including all penny stocks in the ETF, they account for over 20% of the weight in MSOS as of November 27th.