Canada’s legalization experience proves revenues surge when prohibition ends.

Canada legalizing recreational marijuana in October 2018 made this game changer easy to see.

The first G20 Nation to legalize cannabis, Canada’s move signified cannabis as an industry that needs to be taken seriously. One no longer confined to shady back-alley deals.

As I’ve said before, full legalization will make walking into a dispensary and buying a pre-rolled joint as common as walking into a Starbucks and ordering a coffee.

But now that we have fully-legal recreational sales in Canada, it’s time to get down to the nitty-gritty. It’s earnings season, and numbers don’t lie.

We get an early look at what kind of effect the transition from a medical-use country to a recreational-use country has on cannabis sales.

Now, to be clear, Canada’s recreational rollout could have gone much better. But, then again, so could California’s.

Inventory shortages caused by bureaucratic hurdles forced dispensaries in many provinces to close several days a week.

For example, dispensaries in Quebec opened only four days a week.

And in Ontario, Canada’s most populous province, customers couldn’t find a single dispensary open from legalization day through the end of the year – and they still can’t.

Nonetheless, going fully-legal on recreational use means a big bump in sales.

So much so that it’s not hard to see how the U.S. market will get to $100 billion once recreational use becomes more broadly legal in the states.

And the performance of these top Canadian licensed producers proves it…

10,000 Kilos of Pot Sold

During the most recent reporting period, Canopy Growth Corporation (NYSE: CGC) lead the pack among the biggest Canadian LPs.

The biggest cannabis company in the world, its revenues jumped by $74 million in the fourth quarter of last year. Placement in dispensaries and having product to ship drove Canopy’s 320% jump in revenue. It also illustrates the quantum leap the right cannabis companies can experience when medical-only jurisdictions go recreational.

In just those three months, Canopy sold over 10,000 kilograms of cannabis. In the prior quarter, it sold just under 2,200 kilograms, making for a five-fold leap from legalization alone.

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Aurora Cannabis Inc. (NYSE: ACB) and Hexo Corp. (NYSEMKT: HEXO, TSX: HEXO) also saw big jumps in revenue. Aurora more than doubled its revenue by $33 million, while Hexo’s rose by 145%, though, admittedly, from a much smaller base than Aurora or Canopy.

On a percentage basis, of the major licensed producers, Organigram Holdings Inc. (TSXV: OGI, OTC: OGRMF) boosted revenue the most. It sold $12.2 million more worth of cannabis products during its latest reporting period than it had for the prior quarter. And this 530% jump in revenue only includes one-and-a-half months of legalized recreational use since its reporting period ended on November 30th.

All told, across the top six Canadian LPs, revenues in the latest reporting period (ending anywhere from November 30th to January 30th), were $220 million, up nearly 180% from the prior quarter. At that rate, sales from these companies alone will exceed $1 billion over the next twelve months.

And as the industry evolves and revenues shoot higher, it will be hard for an individual investor to stay on top of it all.

So we built the best way for you to do just that.

Keeping You on Top of the Cannabis Game

As the results come in, and the industry surges forward, we will constantly update the NICILytics database, and add more as they go IPO.

Here at NICI, we refer to it as “The Vault.”

In it, we rank companies from a 0 to a 5. You can also sort companies by region, finding the top-tier cannabis stocks in Canada, as well as across the globe.

Subscribers to our NICILytics database get a front-row seat to the biggest developments in the industry. As companies announce earnings and make acquisitions, our Analyst Reports get updated. If something significant happens to change the outlook for a company, we adjust the NICIRating.

Available to Lifetime Members of our Cannabis Investor’s Report, the NICILytics database is full of hidden gems and up-and-comers. It includes data and analysis on over 150 cannabis companies and counting, and it has the most comprehensive information on cannabis stocks that you will find anywhere. With it, you can dive into almost any company in the industry, find all the details you need to make a more educated investment decision, and get the edge to take your cannabis investing skills to the next level.

Now, I know a lot of you are wondering which exchange works best in terms of ease of use, and I know many of you want to know about buying Canadian companies over the counter. In this helpful report, I dive into all of that, allowing you to figure out what works best for you.


Greg Miller

Executive Director, National Institute for Cannabis Investors

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Comments

6 responses to “This Legalization Test Means Big Profits for Your Cannabis Investments”

  1. I am just the little guy but doing ok, so far. No big amounts to invest but signed up in the beginning. When I hit it I will join the newest about IPOs. Till then good luck to all the new investors (including me).

    • Hello im Byron in Lakeland,Fl.and im thinking of investing.Any start up advice would be greatly appreciated.

  2. Love you direction and attitude towards
    Pot and Marajuana product companies
    in the news. The NIC my choice for Cannabis Investor’s!!!!!
    HLT

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