In July, I shared my thinking about why cannabis stocks were primed to rally, pointing to booming product demand, more states legalizing in short order and the likelihood of a friendlier federal regulatory environment. Since then, the New Cannabis Ventures Global Cannabis Stock Index has rallied 13.5% to 34.40 from its July 10th close of 30.31.
A sub-sector delivering much stronger performance than the overall index has been the leading multi-state operators (MSOs). Here is the performance since then for the top 4 in terms of market cap, which includes Cresco Labs, Curaleaf Holdings, Green Thumb Industries and Trulieve:
Since the lows in March, the stocks are up 234-279%, far outpacing the index, which is up about 102% since March 18th.
Why are investors snapping up shares of these large operators? Quite simply, the growth prospects are extremely favorable, as I will discuss below, and the recent earnings reports reinforced this notion, with Curaleaf, GTI and Trulieve having already reported and Cresco set to report its Q2 on August 20th.
Founder & Interim Editor of L.A. Cannabis News