The cannabis industry is growing at a fast pace. Cannabis stocks are showing up every single day, which makes it an excellent opportunity for investors to get into the marijuana industry.
Based on statistics, the global legal cannabis market is estimated at around $13.8 billion in 2020. But, by the end of 2025, the stocks are predicted to go way over $66 billion. The current rise in interest leaves an ideal opening for potential investors to get into the business.
Some even compare it to the Gold Rush in California of 1849. The only major difference is that cannabis can be regrown and the supplies restocked. Let’s take a look at some of the statistical analysis and metrics on cannabis stocks.
Why Now?
The perception of cannabis is changing, in the U.S. and the rest of the world as well.
Based on a survey published in Gallup News, in the mid-90s less than 1/4 of American adults wanted to legalize cannabis. But, now, 2 out of 3 American adults are in favor of legalizing every form of cannabis.
All the clinical research that supports marijuana for its medicinal properties, has made it a go-to choice for treating a range of different health conditions. As a result, the product became socially acceptable.
The truth is, over 50% of the U.S. has legalized medical cannabis, while 10 states have approved recreational use. Not only has it become an ideal opportunity for investors, but states as well. The regions that allow marijuana to be sold, gain a huge amount of profit from it.
In 2014, Colorado has earned over $6.5 billion in cannabis sales. With fees, licenses, and taxes, the state made $1 billion in revenue. This is the kind of income that’s hard to miss out on. But, this is just the beginning.
As the cannabis industry grows, so will the products, varieties, and goods. This creates the ideal chance to increase revenue for the long haul.
COVID-19 Impact on Marijuana Stocks
When the government encouraged people to stay at home, there was a sudden surge in marijuana demand. Based on reports from the Investors, both recreational and medical marijuana users stocked up on cannabis. This product became a favorite choice for dealing with lockdown boredom.
With the increase in demand, cannabis sales jumped over 50% on April 15. The surge was the biggest interest of legal marijuana recorded in history, experts announced.
In the same month in Canada, the sales dropped by 0.6%. That’s because orders were limited to online-only and stores were closing. When shops reopened, sales went up by 2.8%.
Is It Sustainable?
According to Owen Bennett, an expert analyst in the industry, the extra demand is a good thing. But, it’s a question whether or not it will remain sustainable. Experts estimate that the big cannabis producers will have to face harsh competition, particularly with pricing.
To get ahead of the illicit market, more and more rivals are selling cheap brands online. With the lockdown, the physical retail had to target their cash flow online, which was a massive setback.
However, the biggest effect of the pandemic will most likely become evident in the 4th quarter. It is bound to disrupt businesses and affect sales.
What About the Future?
The cannabis market will mature, experts claim. The chief executive of Clever Leaves, Detwiler, stated that the CBD standards will shape based on customer demand.
Since more and more people are aware of the benefits, they will insist on getting more information on the products they buy. They will know exactly what they are looking for and pick only the best buys.
They will want their products to stick to the CBD standards. If manufacturers adhere to producing top-quality products, the market will grow. This kind of approach will massively impact the market size and provide users with fact-driven and research-backed products.
Other experts believe that full-spectrum CBD can be included in peculiar products such as throat sprays, soaps, deodorants, and nasal sprays. With the rise in popularity, each category will be able to grow and develop. The bigger the hype, the more creative producers get.
In the end, the cannabis market will have a range of different applications. This will provide a new opportunity that would expand marijuana use beyond medical and recreational purposes. In the long run, this can create a favorable market for the CBD industry and investors who want to expand their margins.
Final Thoughts
The cannabis industry has potential and stocks are constantly on the rise. With the change in perception, more and more users are willing to try CBD products. In the long run, this will create the perfect opportunity to expand the industry.
Particularly with cannabis products that expand beyond the current use. Overall, it’s the perfect chance to invest in an industry that can deliver results.
References
https://www.grandviewresearch.com/press-release/global-legal-marijuana-market
https://news.gallup.com/poll/243908/two-three-americans-support-legalizing-marijuana.aspx
