Best Canna Stocks to Invest in.

Liz Filmer
23 Aug 2022

Despite legislative delays in the U.S., the cannabis industry is still flying high. According to an industry market forecast, global cannabis sales for 2022 will surpass $35 billion. This is an increase of 22% over 2021. However, regarding the U.S., the outlook for canna stocks is more modest. Currently, 37 states and three territories plus the District of Columbia have approved medicinal and recreational use in 19 states, D.C. and two regions. 

Whilst cannabis use remains prohibited by federal law, rules can change, and many analysts believe the cannabis industry still has much room for growth. If you want to invest in this budding industry, here are four of the best cannabis stocks to buy in 2022.

Cresco Labs Inc. (ticker: CRLBF)

Cresco Labs is a U.S. multistate operator, or MSO and the leading wholesaler of branded cannabis products. As of 2022, it operates 50 retail stores, and over 1,100 dispensaries sell its products. It reported revenue of $214 million, a 20% increase yearly for the first quarter of 2022. However, their stock price has fallen in OTC (over-the-counter) trading in 2022. 

Cresco recently announced its $2 billion acquisition of Columbia Care Inc. (CCHWF), one of the largest MSOs in the medical cannabis industry. This puts Cresco Labs in a solid position as the industry continues to grow.

Cronos Group Inc. (CRON)

Headquartered in Toronto, Cronos Group was the first cannabis stock to list on the Nasdaq in February 2018. It sells both medicinal and recreational products under four brands. While it sells dried cannabis, vaporizers and edibles in some countries, it's limited to hemp-derived supplements in the U.S. Cronos' stock price has experienced significant declines since last August, dropping more than 50%. However, Cronos has positioned itself well for expansion in the U.S., and in 2021 it announced that it had purchased an option to acquire a 10.5% ownership stake in PharmaCann. Depending on U.S. federal cannabis laws, it could use PharmaCann to offer its products.

OrganiGram Holdings Inc. (OGI)

OrganiGram Holdings is a leading licensed medical and recreational marijuana provider in Canada. It has a sales and distribution network throughout the 10 Canadian provinces and the territory of Yukon, but it also serves Israeli and Australian medical markets. In the third quarter of the 2022 financial year, OrganiGram Holdings' net revenue reached 38.1 million Canadian dollars ($29.5 million), up 88% from the same period last year. Like other cannabis stocks, OGI has underperformed year to date and is down more than 30% as of Aug. 12. However, OrganiGram has made significant investments in its facilities, automation and processes to be more cost-efficient. It has also introduced promising new products to its profile. With CA$127 million ($98.5 million) in cash and short-term investments and a negligible amount of debt, OrganiGram could be a solid choice for cannabis investors.

Trulieve Cannabis Corp. (TCNNF)

Trulieve Cannabis Corp. is an MSO operating in 11 states, particularly Arizona, Florida and Pennsylvania. It was the first medical cannabis operator to be licensed in Florida, and as of May 2022, it had more than 165 retail dispensaries and more than 9,000 employees. With its $2 billion acquisition of Harvest Health & Recreation Inc. in 2021, Trulieve is well positioned if Florida legalizes recreational cannabis in the coming years. Although Trulieve's share price on the OTC market is down about 50% this year as of Aug. 12, it reported revenue of $320.3 million in the second quarter, an increase of 49% year on year. Equity research analysts have set a 12-month price target of $54 for TCNNF, which closed at $13.15 on Aug. 12, suggesting a 310% potential upside.

Liz Filmer