Investing in the cannabis industry presents a compelling opportunity due to the sector’s evolving legality and substantial growth potential. As regulatory barriers ease and consumer attitudes shift, the cannabis market is positioned for expansion, offering diverse investment avenues from plant-based companies to ancillary service providers. Furthermore, ongoing research into cannabis’s medicinal applications and the industry’s global reach present additional reasons for investors to consider this emerging market for potential returns and innovation.
The cannabis industry remains very lucrative for those who participate in it. Valued at $64.73 billion in 2024, the industry is expected to leap to $75.09 billion by 2029, marking a five-year CAGR of 3.01%. It is evident that investing in the industry is a very beneficial decision for your portfolio; the only issue is, which stocks? I have your answer. Keep reading, and you will find out.
Tilray Brands (TLRY)
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Tilray Brands (NASDAQ:TLRY) is a global cannabis lifestyle and consumer packaged goods company with segments in medical cannabis, adult-use cannabis, beverage alcohol, and wellness. Recently priced at $1.93, Tilray depreciated 29.82% over the last year, giving it a market cap of $1.556 billion.
Tilray Brands commands a market share of 11.6% in the Canadian cannabis market. Additionally, Tilray leads the production of cannabis flowers, oils and concentrates, establishing its dominance throughout the cannabis industry.
Tilray Brands reported insane figures in the fiscal year 2023. Although the company reported revenue of $627.1 million, a 0.2% year-over-year (YoY) increase from the previous year, net income income tripled to $1.452 billion while earnings surged 137% to $2.35 per share.
The cannabis stock expanded its beverage segment into new ventures like Sweetwater, Alpine and Green Flash Brewing, which indcates Tilray’s growing diversification. Furthermore, Tilray has a book value of $5.05 per share and $3.315 billion in shareholder equity, doubling its market cap. This indicates the stock is cheap and undervalued but stable, with a lot of money in assets compared to liabilities. Therefore, Tilray is the best cannabis stock in May 2024, with solid business figures and a cheap valuation.
Trulieve Cannabis (TCNNF)
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Trulieve Cannabis (OTCMKTS:TCNNF) is a notable provider of cannabis products, both recreational and medical. It is the second-largest company in the U.S. cannabis industry. At $11.60 per share, Trulieve has experienced a massive 122.65% YTD growth.
Revenue growth for Trulieve was negative in 2023 but is on the rise this year. Q1 revenue turned positive just as free cash flow (FCF) began to turn around. Starting off negative in last year’s Q1, FCF is now at $118.06 million in 2024. Although the financials started weak, they now show a positive trend, something we can expect to see throughout the rest of 2024.
Currently, recreational cannabis products are illegal in Florida. However, recent ballots show considerable support for allowing people 21 and older to own up to 3 ounces of product. Florida will need at least 60% support to pass this. This could greatly benefit Trulieve, which is headquartered in Florida. If this passes, it can generate about $80 million in revenue growth for Trulieve.
To conclude, Trulieve has shown a significant improvement in finances and has a lot of potential through the Florida ballot.
Green Thumb Industries (GTBIF)
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Green Thumb Industries (OTCMKTS:GTBIF) is an American cannabis consumer goods company distributing various marijuana products for its customer base. Valued at $12.90, GTBIF’s significant growth of 62% shows a green light to buy the stock for long-term profitability.
Green Thumb Industries’ financial standings hold substantial potential for the coming quarters, as seen in Q1 2024. Starting with revenue, GTBIF brought in $275.8 million, marking a YoY increase of $11 million from Q1 2023. GTBIF is seeing profit growth accelerate as net income jumped 52.5%, greater than 2023’s 50.2% increase.
The most significant upside for Green Thumb’s operations comes from the increase in their retail operations, with more direct-to-consumer sales noted in 2024’s first quarter. This past quarter, Green Thumb announced that stores open for at least 12 months saw 7.9% increases in retail revenue, while selling consumer packaged goods leaped by 19.3% YoY. Continuously growing consumer sales will further GTBIF’s value for years to come.
On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
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