In this article, we discuss 10 medical marijuana stocks to buy now.
Medical Marijuana, also called medical Cannabis, is a herbal drug derived from plants of the genus Cannabis that is used as part of the treatment for specific symptoms or diseases, including cancer, chronic pain, and a number of physical and mental disorders. As the push for legalization at home and abroad grows, alongside the impact of the Covid-19 pandemic, marijuana is garnering significant attention from investors, manufacturers, and policy makers across multiple regions. According to a report, the market exhibited a tremendous growth of 50.92% at $20.47 billion in 2020, and is projected to grow from $28.266 billion in 2021 to $197.74 billion in 2028 at a CAGR of 32.04% between 2021 and 2028.
Both Canada and the United States are considered the top contenders in the legal marijuana space, with both countries possessing certain attributes that give them an edge over the other. However, based on reports presented by the Wall Street Journal, US-based companies are likelier to overtake their Canadian counterparts in the coming quarters, in light of the rapid legalization of marijuana and a bigger market for the drug existing in the country. A research report by Pew Research Center suggests an overwhelming share of US adults (91%) say either that marijuana should be legal for medical and recreational use (60%) or that it should be legal for medical use only (31%). Fewer than one-in-ten (8%) say marijuana should not be legal for use by adults.
The above serves to prove that the marijuana industry is set to become a highly lucrative investment opportunity that offers your portfolio an excellent source of growth, with companies like Jazz Pharmaceuticals Inc. (NASDAQ:JAZZ), Tilray, Inc. (NASDAQ:TLRY), Innovative Industrial Properties, Inc. (NYSE:IIPR), and Cara Therapeutics, Inc. (NASDAQ:CARA) ready to rake in the benefits due to these developments.
Our Methodology
For our list, we chose stocks based on their performance in the marijuana industry. The business fundamentals and analyst ratings for these firms are also discussed to provide readers with some additional context for their investment choices. The hedge fund sentiment around each stock was derived from Insider Monkey’s database where applicable.
Best Medical Marijuana Stocks to Buy Now
10. Green Thumb Industries Inc. (OTC:GTBIF)
Number Of Hedge Fund Holders: N/A
Green Thumb Industries Inc. (OTC:GTBIF) is a national cannabis consumer packaged goods company and retailer that manufactures and distributes a portfolio of branded marijuana and cannabis products including Beboe, Dogwalkers, Doctor Solomon’s, Good Green, incredibles and RYTHM.
The medicinal and recreational cannabis distributer saw its Q1 2022 net income skyrocket 179% to $28.9 million ($0.12 per basic and diluted share) compared to the prior-year period amid a significant revenue boost. Additionally, the company’s EPS came in at $0.09, surpassing market estimates by $0.04.
On July 22, Seaport Global analyst Sonny Randhawa initiated coverage of Green Thumb Industries Inc. (OTC:GTBIF) with a Buy rating and $15 price target. The analyst believes the cannabis group is “going through a bottoming process” and will be higher six months from now and amongst the best performing sectors over the next three to five years. Investors should buy the group today and use any market induced volatility to increase exposure, Randhawa tells investors in a research note. The analyst says the sector is “grossly misunderstood by the analyst community and plagued by an incessant amount of noise from Washington.” He sees the sector growing annually at 17% and anticipates the U.S. legal market to be $86 billion in 2030, with the overall market at $140 billion.
Much like Jazz Pharmaceuticals Inc. (NASDAQ:JAZZ), Tilray, Inc. (NASDAQ:TLRY), Innovative Industrial Properties, Inc. (NYSE:IIPR), and Cara Therapeutics, Inc. (NASDAQ:CARA), Green Thumb Industries Inc. (OTC:GTBIF) is a notable marijuana stock to buy.
9. Trulieve Cannabis Corp. (OTC:TCNNF)
Number Of Hedge Fund Holders: N/A
Trulieve Cannabis Corp. (OTC:TCNNF) is an American company that engages in the provision of medical cannabis products and services. It cultivates and produces its products in-house and distributes to its branded stores, as well as directly to patients via home delivery.
Earlier this May, Alliance Global Partners analyst Aaron Grey lowered the price target on Trulieve Cannabis Corp. (OTCMKTS:TCNNF) to C$50 from C$60 and maintained a Buy rating on the shares. The analyst notes that against a challenging industry backdrop, Trulieve delivered a strong quarter as sales and EBITDA came in above his and Street expectations, with the company maintaining its margin profile quarter-over-quarter and reiterating full year guidance. Further, he believes its strong cash position puts the company in a position to capitalize on attractive acquisition opportunities to expand in existing or enter new markets.
According to the company’s fiscal first quarter earnings report, Trulieve Cannabis Corp. (OTC:TCNNF) recorded an EPS of $0.01. Additionally, the firm’s revenue for the quarter came in at $318.3 million, an increase of 64.22% on a year-over-year basis, crossing forecasts by $11.87 million.
8. Village Farms International, Inc. (NASDAQ:VFF)
Number Of Hedge Fund Holders: 3
Village Farms International, Inc. (NASDAQ:VFF) is a vertically integrated marijuana grower and vegetable supplier based in Delta, British Columbia, Canada. It operates in both Canada and the United States through its wholly-owned subsidiaries, Pure Sunfarms and Balanced Health Botanicals.
Earlier this May, Craig-Hallum analyst Eric Des Lauriers lowered the price target on Village Farms International, Inc. (NASDAQ:VFF) to $5 from $15 to reflect inflation and macro valuation headwinds. However, the analyst maintained a Buy rating on the shares given the strong near-term growth expected in Canadian cannabis and discount versus peers.
According to Insider Monkey’s database, Village Farms International, Inc. (NASDAQ:VFF) was spotted on 3 investment portfolios by the end of the first quarter of 2022. The total stakes of these funds in the company amounted to approximately $2.43 million. Israel Englander’s Millennium Management is the largest stakeholder in Village Farms International, Inc. (NASDAQ:VFF) , with stakes valued at $2.36 million.
7. OrganiGram Holdings, Inc. (NASDAQ:OGI)
Number Of Hedge Fund Holders: 6
OrganiGram Holdings, Inc. (NASDAQ:OGI) is a Canadian company that covers several kinds of cannabis products and their distribution channels. Although it first began as a medical cannabis provider, the company is now focused on producing high-quality, indoor-grown cannabis for patients and adult recreational consumers in Canada, as well as developing international business partnerships to extend the company’s global footprint.
On July 15, Alliance Global Partners analyst Aaron Grey lowered the price target on Organigram Holdings, Inc. (NASDAQ:OGI) to C$1.50 from C$2.25 and kept a Neutral rating on the shares. The company reported sales above Street expectations driven by strong Canadian adult-use sales, though its EBITDA came in slightly below estimates due to lower gross margins. The analyst continues to look for sustained and improved profitability “amid what could remain a competitive Canadian adult-use market”.
OrganiGram Holdings Inc. (NASDAQ:OGI) posted strong revenue growth during its fiscal third quarter of 2022. The company registered earnings per share of -$0.01, beating market estimates by $0.01. The revenue for the quarter came in at $29.09 million, an increase of 79.14% on a year-over-year basis, crossing estimates by $3.02 million.
At the end of the first quarter of 2022, 6 hedge funds in the database of Insider Monkey held stakes worth $5.64 million in Organigram Holdings, Inc. (NASDAQ:OGI), down from 9 the preceding quarter worth $11.47 million. D E Shaw is the leading shareholder in Organigram Holdings, Inc. (NASDAQ:OGI), with more than 1.78 million shares worth more than $2.96 million.
6. Aurora Cannabis Inc. (NASDAQ:ACB)
Number Of Hedge Fund Holders: 9
Cronos Group Inc. (NASDAQ:CRON) is a company focused on medical marijuana and recreational cannabis for adult use that is best known for producing, selling, and marketing products in Canada, Germany, Israel, Italy and Australia. The company reported $45.7 million in medical marijuana sales in the second quarter of the fiscal year 2022, representing 75% of total income.
Earlier this June, Cantor Fitzgerald analyst Pablo Zuanic upgraded Aurora Cannabis Inc. (NASDAQ:ACB) to Overweight from Neutral with a price target of C$4.05, up from C$3.90. The analyst views Aurora as an attractively valued pure cannabis play, and expects Europe, and more specifically Germany, to be a “relevant potential catalyst and sentiment driver” for cannabis stocks over the next 12-18 months.
At the end of the first quarter of 2022, 9 hedge funds in the database of Insider Monkey held stakes worth $40.8 million in Aurora Cannabis Inc. (NASDAQ:ACB), compared to 11 in the preceding quarter worth $69.6 million.
Similar to Jazz Pharmaceuticals Inc. (NASDAQ:JAZZ), Tilray, Inc. (NASDAQ:TLRY), Innovative Industrial Properties, Inc. (NYSE:IIPR), and Cara Therapeutics, Inc. (NASDAQ:CARA), Aurora Cannabis Inc. (NASDAQ:ACB) is one of the stocks that investors are keeping their eye on.
5. Cronos Group Inc. (NASDAQ:CRON)
Number Of Hedge Fund Holders: 9
Cronos Group, Inc. (NASDAQ:CRON) is a cannabis manufacturer that manufactures, promotes, and sells hemp-derived supplements and cosmetics through e-commerce, retail, and hospitality partner channels in the United States. The company announced the launch of the first of what is expected to be a range of products, in partnership with Geocann, which will utilize the advanced VESIsorb delivery system on June 27.
Earlier this May, CIBC analyst John Zamparo upgraded Cronos Group Inc. (NASDAQ:CRON) to Outperform from Neutral with an unchanged price target of $4.50. The shares provide “downside protection and upside from a potential continuation of vastly improved results,” Zamparo tells investors in a research note post the Q1 results. Based on his remarks, there are “multiple reasons for optimism” with regards to Cronos, including $1 billion in net cash, attractive valuations, and a path to profitability that took a step forward in the first quarter.
Major hedge funds hold bullish positions in Cronon Group Inc. (NASDAQ:CRON). At the end of the first quarter of 2022, 9 hedge funds in the database of Insider Monkey held stakes worth $48.14 million in Cronon Group Inc. (NASDAQ:CRON), compared to 11 in the preceding quarter. Traci Lerner’s Chescapmanager LLC is the leading shareholder in Cronos Group Inc. (NASDAQ:CRON), with 8.32 million shares worth more than $32.39 million.
4. Cara Therapeutics, Inc. (NASDAQ:CARA)
Number Of Hedge Fund Holders: 13
Cara Therapeutics is a biotechnology company focused on developing therapeutics to treat diseases associated with pain and inflammation. On June 30, the company announced positive topline results from its Phase 2 proof-of-concept clinical trials evaluating its oral medication, difelikefalin, for the treatment of moderate-to-severe pruritus in patients with notalgia paresthetica, a nerve disorder characterized by chronic pruritus of the upper to middle back.
Here is what the company’s Chief Medical Officer, Joana Goncalves, had to say:
“We are pleased to have demonstrated clinical proof of concept for oral difelikefalin in the treatment of pruritus associated with notalgia paresthetica. These topline results coupled with the results from our other programs support the broad development of oral difelikefalin across disease areas regardless of the underlying cause of pruritus. We look forward to completing our data analyses and discussing next steps with the U.S. Food and Drug Administration.”
Earlier this May, H.C. Wainwright analyst Oren Livnat “strongly” reiterated a Buy rating on Cara Therapeutics, Inc. (NASDAQ:CARA) with a $30 price target on its shares. The analyst, who believes the profitability of IV Korsuva and Cara’s profit-split revenue will “positively surprise investors,” noted that he looks forward to the Q2 results to get the first look at net IV Korsuva sales.
At the end of the first quarter of 2022, 13 hedge funds in the database of Insider Monkey held stakes worth $75.8 million in Cara Therapeutics, Inc. (NASDAQ:CARA), compared to 15 in the preceding quarter. Out of the hedge funds being tracked by Insider Monkey, Thomas Steyer’s Farallon Capital is a leading shareholder in Cara Therapeutics, Inc. (NASDAQ:CARA), with 2.5 million shares worth more than 30.37 million.
3. Innovative Industrial Properties, Inc. (NYSE:IIPR)
Number Of Hedge Fund Holders: 15
Innovative Industrial Properties, Inc. (NYSE:IIPR) is a marijuana real estate investment trust (REIT) that focuses on the acquisition, ownership and management of specialized industrial properties leased to operators for their regulated medical-use cannabis facilities.
JMP Securities analyst Aaron Hecht lowered his price target on Innovative Industrial Properties, Inc. (NYSE:IIPR) to $150 from $190 but maintained an Outperform rating on the shares on July 19 following the announcement of Kings Garden tenant default by the company’s management after it missed rental payments. Although the Kings Garden default will be a near-term negative to FFO, the analyst believes that the company’s cash flow should be recouped once the facilities are re-leased.
At the end of the first quarter of 2022, 15 hedge funds in the database of Insider Monkey held stakes worth $311.4 million in Innovative Industrial Properties, Inc. (NYSE:IIPR), compared to 13 in the preceding quarter worth $273.7 million.
2. Tilray, Inc. (NASDAQ:TLRY)
Number Of Hedge Fund Holders: 17
Tilray, Inc. (NASDAQ:TLRY) is a global pharmaceutical, cannabis-lifestyle and consumer packaged goods company that operates as one of the leading providers of medical cannabis in Australia and New Zealand for commercial, compassionate access, and research purposes and the first licensed producer to legally export medical cannabis from North America to Australia and New Zealand.
Roth Capital analyst Scott Fortune lowered the price target on Tilray, Inc. (NASDAQ:TLRY) to $4 from $8 and kept a Neutral rating on the shares on July 15. Tilray, Inc. (NASDAQ:TLRY) closed its strategic transaction and alliance with HEXO Corp, a leader in the Canadian cannabis market space, purchasing the HEXO note from HTI for $155 million, which provides financial benefits of cost-synergies and strengthening product innovation for global market opportunities, Fortune tells investors in a research note.
By the end of the first quarter of 2022, 17 hedge funds held stakes in the company worth around $85.48 million. This is compared to 20 funds in the preceding quarter, with stakes worth $118 million. The company has been a leader in the cannabis market for a while now, with D.E. Shaw being one of the largest shareholders in Tilray, Inc. (NASDAQ:TLRY) owning over 1.5 million shares of the stock, valued at roughly $11.7 million.
1. Jazz Pharmaceuticals plc (NASDAQ:JAZZ)
Number Of Hedge Fund Holders: 38
Jazz Pharmaceuticals plc (NASDAQ:JAZZ) is an Irish specialty cannabis biopharmaceutical company that develops several drugs to treat diseases and disorders, including sleep disorders, cancer, leukemia, liver diseases, and post traumatic stress disorder.
On June 13, UBS analyst Ashwani Verma initiated coverage of Jazz Pharmaceuticals plc (NASDAQ:JAZZ) with a Buy rating and $194 price target as part of a broader research note on U.S. Pharmaceuticals. The company’s diversification from childhood epilepsy and Oncology is underappreciated, the analyst tells investors in a research note, stating that the Street is also overestimating the impact of patent cliff.
Earlier this May, Jazz Pharmaceuticals plc (NASDAQ:JAZZ) has completed the divestiture of Sunosi in the U.S. to Axsome Therapeutics. Under the terms of the agreement, Jazz received an upfront payment of $53 million, and will receive a high single-digit royalty on Axsome’s U.S. net sales of Sunosi in current indications and a mid-single-digit royalty on Axsome’s U.S. net sales of Sunosi in future indications.
35 hedge funds owned a stake in the company as of the first quarter of 2022, with Jim Simons’ Renaissance Technologies being the largest investor in Jazz Pharmaceuticals plc (NASDAQ:JAZZ), owning over 1.5 million shares worth roughly $236 million.
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Disclose. None. 10 Medical Marijuana Stocks to Buy Now is originally published on Insider Monkey.
