Why Are Marijuana Stocks Down In 2022?
Are top marijuana stocks on your radar while the sector trades at new lows in 2022? This year the best cannabis stocks to buy have continued losing value as the months have progressed. Although the expansion of the cannabis industry in the US and abroad continues to grow rapidly most pot stocks continue declining due to delays with US federal marijuana legalization. In 2022 the House has passed the MORE Act again for another attempt of making it through the Senate which has continued to hold back the progress of the cannabis industry on the federal level.
Additionally, Senate Majority Leader Chuck Schumer has also stated that he would formally introduce the CAOA in August which he previously stated he would introduce in April. In last week’s trading, the overall market experienced a significant decline after Fed leaders expressed, that we could have a 50-basis point rate hike at the next FOMC meeting in May. This coupled with current inflation and a possible recession in 2023, has caused the biggest drop in the market since 2020.
Because of the current state of the market many investors have switched to a short-term investment strategy for 2022. One method many cannabis investors are currently applying is a core trading technique that takes advantage of current market volatility. In general, investors can begin a core position in a cannabis stock and actively trade the volatility by trading around that core with short-term positions. This allows them to produce gains with the price fluctuations in a pot stock.
Strategies For Trading The Cannabis Sector During Market Volatility
At the present time, there are many ways to take advantage of the recent declines in top marijuana stocks. Some investors prefer to trade Canadian cannabis stocks which are available on the major US stock exchanges. While others prefer US MSO pot stocks on the OTC Markets. Since 2021 US MSOs have become the largest revenue-producing cannabis companies in the world a title that used to belong to the Canadian LPs. As the entire cannabis sector trades near new lows, it could be time to add top cannabis stocks to your watchlist before May.
Before investing in any cannabis stocks, it’s important to do your own research on these companies before starting a position. Looking into a company’s financials and press releases can help you find the best cannabis companies to invest in. Additionally following how a stock performs in the market can help you make the best entries for your positions. As we close out a volatile month of April let’s look at 2 top marijuana stocks to watch next week.
Best Marijuana Stocks To Watch Before May
Canopy Growth Corporation
Canopy Growth has developed into one of Canada’s largest manufacturers and distributors of cannabis and cannabis-derived products. In Canada, the United States, and Germany, the corporation primarily sells cannabis and hemp-derived products. In 2021, Canopy will partner with Southern Glazers Wine & Spirits to distribute CBD beverages in the United States. Canopy has acquired Supreme Cannabis Firm, Inc., a high-end cannabis company, to expand its brand portfolio in Canada. The company also introduced Whisl, a revolutionary CBD vape designed to help you manage your mood throughout the day. In March, the company’s Martha Stewart CBD brand introduced more Tropical CBD Wellness Gummies to its lineup.
On February 9th, Canopy released its third-quarter fiscal 2022 earnings, with net revenue of $141 million, down 8% from Q3 F2021. In addition, gross margins in the third quarter of FY2022 were 7%, compared to 16% in the third quarter of FY2021. Importantly, the company lost $115 million in the third quarter of 2022, a major decrease from the $714 million loss in the third quarter of FY2021. The company remained the industry leader in Canada, with a 10% market share. The company’s market share in 2022 has stabilized due to increased customer demand for the company’s new strains. In April the company unveiled a behind-the-scenes look into its 7 ACRES premium flower production.
CGC stock closed at $5.57 on April 22nd down 18.33% in the past five trading days. Currently, the stock has a 52-week price range of $5.53-$28.38 down 36.20% year to date. According to analysts at CNN Business CGC stock has a 12-month median price target of $7.10 per share. This estimate would be a 27.20% increase from its last trading price of $5.57.
Curaleaf Holdings, Inc.
Curaleaf Holdings, Inc., a multi-state cannabis retailer with 128 retail locations across the United States, produces packaged cannabis products. In addition, Curaleaf International’s Adven GmbH, a wholly-owned subsidiary, has begun marketing medicinal cannabis products in Germany. In the United States, Curaleaf’s Select brand is one of the most well-known. After buying Tryke Companies in November, Curaleaf expanded its operations to three additional states. The corporation currently has properties in Arizona, Nevada, and Utah in its portfolio. The business launched its 45th facility in Florida on March 14th.
In the fourth quarter and fiscal year, 2021 revenue for Curaleaf was $1.2 billion, up 93 percent from the previous year. Additionally, in the fourth quarter, the company generated $320 million in revenue and $80 million in adjusted EBITDA. In the fourth quarter of 2021, the company established eight new retail locations, resulting in gross profit sales of $159 million. Los Suenos Farms was also purchased, raising the corporation’s total cultivation capacity to 4.4 million square miles. The company will reveal its first-quarter 2022 financials after the market closes on May 9th. Curaleaf is one of the most well-known companies that is serving the new recreational cannabis market in New Jersey currently.
On April 22nd, CURLF shares closed at $6.46, down 4.44% in the last month. The stock is currently trading in a 52-week range of $5.35-$15.47 and is down 28.22% year to date. According to analysts at Tip Ranks CURLF stock has a 12-month average price target of $14.59 per share. In this case, this would represent an upside of 125.85% from its last trading price of $6.46.
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