The North American cannabis industry has become a green field since last week's Democratic victories in the US Senate elections. With the Senate coming under democratic control later this month, the general consensus is that federal legalization of marijuana will be a reality in the coming years.
The Democrats have clearly stated their intention to legalize marijuana on the market. federal level. It is a step that will remove many legal, regulatory and funding hurdles. And the markets reacted quickly.
One of the biggest winners on the news were Canadian-based vertically integrated growers who have waited their time to access what is considered the most lucrative marijuana market in the world.
Canadian cannabis stocks also traded in the US markets began their upward movement when trading opened on January 6, the day after the election, when only one race was declared for Democrats, and the other seemed even though the vote stretched to the next day.
Shares of Aphria (NASDAQ 🙂 (TSX :), Cronos Group (NASDAQ 🙂 (TSX 🙂 and others jumped, posting double-digit gains.
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The move was expected, as the pot supply has soared since the election of President-elect Joseph Biden last November. But at the time, with the Senate still under Republican control, the road to legalization – well, at least the timeline – wasn't clear. Now investors seem reassured.
Last week, Cronos shares made impressive gains. By yesterday's close, stocks were up nearly 31% compared to the open Monday.
But the biggest gain was Tilray (NASDAQ :). By yesterday's close at $ 12.33, it was up about 36.4% since the start of the previous week. Still on the news that it inked a $ 5 billion merger with Aphria last month, a deal that will make it the largest marijuana company in the world when the merger closes later this year.
It is poised to make emergence in the US, including on the adult beverage market. Stocks are expected to continue to rise, but they still have a way to go to make up for the losses they took in 2020. Despite the most recent gains, Tilray shares are still down more than 20% in the past 12 months.
Investors may also want to check out the Toronto-based Cronos Group. Trading in both Canada and the United States, stocks climbed by a striking clip last week, gaining nearly 31% between the start of trading last week and the close of yesterday.
Not to be counted, Canopy Growth is from Ontario (NASDAQ 🙂 (TSX :). Thanks to its strategic partnership with US-based Acreage Holdings (OTC :), it was set up to provide the fastest access to the US market.
Its main stakeholder, US beer maker Constellation Brands (NYSE :), is also keen to see its investment in the major US adult beverage industry pay off. So look for a quick acceleration of operations there.
New York Wants To Benefit From Tax Revenues
And this just in: Another sign of greener pastures for the cannabis sector came yesterday, when New York Governor Andrew Cuomo , announced its pledge to legalize adult marijuana and the creation of the Office of Cannabis Management.
The decision would allow the Empire State to cash in on its lucrative tax revenues. through legal pot, a source of income that neighboring states, such as New Jersey, have seen soaring in recent years. Cuomo said Monday he expected tax revenues on marijuana to reach $ 300 million a year.
