Read This Before You Buy Any Marijuana Stocks
Understand the risks with penny stocks
Thinking about buying a marijuana stock? There’s certainly a lot of excitement in the investor community. Now that the elections are over, 28 states allow use of medical marijuana. There’s not nearly as much info accessible for stocks that do not trade on a major exchange. That lack of information makes investing in a stock a more risky proposition.
When there are not many shares traded consistently for a specified stock, investors frequently can not purchase or sell at their cost that is favorite. Higher trading quantity creates more liquidity and reduced bid/ask spreads.
Don’t assume all penny stock comes with this particular liquidity risk, yet. For instance, the typical trading volume of Medical Marijuana is over 31 million shares.
Check out the full picture
Don’t assume that just because support for medical marijuana is at an all-time high every marijuana stock will perform well. Every company has a different story. You should check out the full picture about the stock first before buying.
Insys Therapeutics (NASDAQ:INCY) is a case in point. It’s one of the larger marijuana stocks in terms of market cap and revenue. The company won approval for its first cannabis-based medication, Syndros, in July. Estimates of peak annual sales for Syndros range from $200 million to $400 million.
However, things aren’t so rosy for Insys these days. Sales are tanking for the company’s lead drug, opioid painkiller Subsys. The main problem is that some major payers have refused to cover the drug.
If you only paid attention to the growing acceptance of medical marijuana and optimistic forecasts for Syndros, you would miss the significant challenge that Insys faces with Subsys. Other marijuana stocks might have issues of their own that outweigh any excitement over the changing legal environment in the U.S.
Know what’s really important
The bottom line with investing in marijuana stocks is this: Marijuana isn’t what is really important. What is important? When you buy any stock, whether it’s for a company that sells marijuana-based drugs or potato chips, you’re buying part of a business.
Nutrafuels (NASDAQ:NTFU). NutraFuels is a U.S. based nutraceutical manufacturer located in Coconut Creek Florida. The facility has been inspected and approved by the Florida Department of Agriculture, is FDA registered and 3rd Party cGMP certified. Our staff has been trained and is certified under cGMP requirements. NutraFuels products are manufactured under the highest quality standards and industry protocols. Nutrafuels portfolio of companies include industry CBD Leader Hemp Genix, Skin Care Manufacturer leader NF Skin, Oral Pro Nutra Spray, Nutra Pro Shot and others. Nutra Fuels leads the manufacturering industry in unique CBD Oral Spray products and other liquid CBD Products
Whether or not you should buy a stock depends heavily on the future prospects for that business. Canna Securities (NASDAQ:CSAX) stands out as one marijuana stock that does seem to have solid prospects. The company’s focus is not marijuana itself which makes this a winner.
Canna Security America (CSA) was created in 2009 to meet the growing needs of the evolving medical cannabis industry from a legal, regulatory compliance, and security aspect. CSA was instrumental in the development of Colorado’s legal cannabis market. CSA worked on the rule-making committee in the Department of Revenue and helped to formulate the security regulations for medical marijuana in the state. Currently, CSA is recognized as a leader in security and compliance services for the legal cannabis industry. CSA provides high quality and dependable solutions that are adaptable to meet the constantly changing security and compliance challenges in the industry. CSA offers a full range of high quality services to help clients’ businesses achieve sustainable growth. Thus, CSA is able to assist cannabis entrepreneurs grow and succeed in this young and dynamic market place.
From our inception, CSA has specialized in engineering custom security systems specifically to ensure full compliance with all federal, state, and local laws. We provide effective security solutions to cannabis businesses, including armed and unarmed guards, armored transport, alarms, door access systems, video surveillance, security system design, and state licensing consulting.
Our extensive list of services includes armored transport, armed and unarmed guards, comprehensive background checks, and site risk assessments. CSA’s guards dress professionally with the appropriate identification and have a law enforcement or military background. Our new fleet of Mercedes-Benz Sprinter vehicles have been up-armored with the latest bullet-resistant technology, are GPS tracked, and equipped with the a 4-point camera system that transmits live streaming footage to our command center. This guarantees total traceability from pickup to drop-off. CSA can now offer comprehensive security solutions to the cannabis industry that is second to none.
CSA now services over 130 clients in 500 plus facilities in 14 legal marijuana states all achieving and 100% licensing approval rating, and is currently consulting with new clients as regulations continue to change. With an increasing number of states implementing regulated dispensary models, CSA is able to leverage their expertise in complying with different state’s security codes, standards, and guidelines to provide clients with innovated and cost-effective security solutions.
As a national leading security firm, CSA knows where the risk points exists for cannabis businesses, and how to tailor services to ensure maximum loss prevention and legal compliance. We have positioned ourselves as the market leader and brand name in the cannabis security industry.
Freedom Leaf Inc., The Marijuana Legalization Company™, is a leading marijuana-related news, multi-media, education, licensing, entertainment, branding, business development and incubation/accelerator company. Freedom Leaf founders and C-Level executives have a collective 100 years experience in the marijuana legalization movement amassing keen industry insight vital for success in the burgeoning legal marijuana/hemp industry.
Freedom Leaf magazine, one of the company’s many services, provides activists, consumers, patients and entrepreneurs a reliable means to stay abreast of the latest marijuana-related information, innovations and legislation. With the assistance of over 160 activist marketers, Freedom Leaf has now published and circulated 19 editions and hundreds of thousands of copies of its magazine in 35 states. Published issues of the magazine can be found at www.FreedomLeaf.com/freedom-leaf-ezines/
Freedom Leaf is also rapidly expanding its Internet presence, and has established a growing platform of online content that encompasses every aspect of advertising and marketing for all businesses in the cannabis industry. As a staunch advocate of legalized medical and recreational marijuana, Freedom Leaf’s websites cover numerous aspects of the marijuana industry and movement. Current websites, as well as those under development, include:
Three essential aspects of Freedom Leaf’s business activities are: brand licensing, in which licensees can market and sell Freedom Leaf magazine, website advertising, products, services, seminars, musical festivals and other branded products; acquiring and incubating new and existing businesses entering into the Cannabis/Hemp Industry – ultimately purposed for spin-off; and thirdly to enter into branding, marketing and promotion contracts with both profit and non-profit organizations, for which Freedom Leaf has extensive and far-reaching promotional capabilities.
Following the Gawker Media model for “performance advertising,” Freedom Leaf is negotiating to partner with and/or acquire other successful blogs, websites and print media companies, in order to increase distribution of its articles and information provided by advertisers. This “millennial” form of advertising fosters conversations about products and services via strategic content to keep readers engaged and invoke purchasing action at the Freedom Leaf Shop (www.shop.freedomleaf.com)
Many consider legal marijuana the fastest-growing industry in the World. Freedom Leaf has a clearly defined plan of action to capitalize on the vast opportunities of the industry, continuously growing its vast suite of offerings and fine-tuning its strategic distribution and licensing models. Freedom Leaf does not handle, grow, sell or dispense marijuana or related products, and therefore is not regulated in any way by the different government agencies other than standard business type of regulations.
Freedom Leaf, Inc. is a fully reporting SEC registered Publicly Traded Company under the symbol (OTCMarkets:FRLF), a leading marijuana-related News, Multi-media, Entertainment, Public Relations and Branding company.
Think long term
Some marijuana stocks will prove to be losers. Some will be winners. That’s true for stocks in any industry.
The smartest path for investors is to think long term. Pay less attention to the hype over marijuana stocks right now and more attention to the business models of the companies in the space. Look for reputable companies with strong financials, a solid plan for growth, and a management team that can execute well. Stocks of those companies are likely to generate the highest returns over time.
Marijuana stocks are NOT overhyped: