Comparing the Cannabis Stock Boom to Bitcoin’s Run? Consider This

Cannabis stocks are booming, and many are comparing them to bitcoin stocks. But pot stocks have one thing going for them.

Photo by rawpixel on Unsplash

Photo by rawpixel on Unsplash

Tilray Inc. (NSDQ: TLRY.O) is a growing Canadian cannabis producer, and its market valuation reminds some of the bitcoin craze. Currently just shy of $14 Billion, its valuation grew more quickly over the past three months than bitcoin did during its yearlong rally.

Of course, Tilray Inc.’s not alone in its ascent, as competitors in the space saw stock prices rise. And when the broader market entered correction territory last week, the marijuana market maintained momentum.

Lofty projections for the market value cannabis could ‘disrupt’ range from $150 – $500 Billion over the next decade, and many are comparing the marijuana madness to the bitcoin bubble.

Revenues set pot stocks apart

There are similarities with the digital currency craze, and also one significant difference: revenue.

As pot users and stock watchers prepare for legalization tomorrow, online and bricks-and-mortar stores across the country prepare to sell their real-life products.

Here’s a roundup of second quarter revenues for cannabis companies operating in that country.

Producers reporting in Canadian dollars

Canopy Growth (TSX: WEED)                        C$25.9m

Aurora Cannabis (TSX: ACB)                         C$19.1m

MPX Bioceutical (CSE: MPX)                         C$14.5m

Aphria (TSX: APH)                                          C$13.3m

Isodiol International (CSE: ISOL)                    C$9.2m

CannTrust (TSX: TRST)                                  C$9.1m

Sunniva (CSE: SNN)                                       C$4.5m

Namaste Technologies (TSXV: N)                  C$4.1m

Organigram (TSXV: OGI)                                C$3.7m

Supreme Cannabis (TSXV: FIRE)                   C$3.6m

CannaRoyalty (CSE: CRZ)                              C$3.5m

Cronos Group (TSX: CRON)                           C$3.4m

1933 Industries (CSE: TGIF)                           C$3.3m

And, cannabis companies are reporting earnings in USD as well.

Producers reporting in U.S. dollars

Trulieve (CSE: TRUL)                                       $23.3m

Charlotte’s Web Holdings (CSE: CWEB)          $17.2m

Green Thumb Industries (CSE: GTII)               $13.6m

KushCo Holdings (OTCQB: KSHB)                  $12.9m

CV Sciences (OTCQB: CVSI)                           $12.3m

Tilray Inc. (NASDAQ: TLRY)                             $9.7m

Terra Tech (OTCQX: TRTC)                             $7.2m

MedMen Enterprises (CSE: MMEN)                 $7.2m

GrowGeneration (OTCQB: GRWG)                  $7.2m

Planet 13 Holdings (CSE: PLTH)                      $4.4m

Golden Leaf Holdings (CSE: GLH)                   $3.7m

GW Pharma (NASDAQ: GWPH)                      $3.5m

Cannex Capital (CSE: CNNX)                          $3.4m

Innovative Industrial (NYSE: IIPR)                   $3.3m

Marimed (OTC:MRMD)                                    $2.9m

Just as bitcoin was a year ago, the word cannabis seems to be on many major company’s lips, from Constellation Brands to Coca-Cola, to Walmart. Walmart’s Canadian arm stated early this month that it would consider retailing cannabis products. Coca-Cola, moreover, said it was watching the industry in September when rumors of a partnership with Aphria leaked. Constellation Brands, makers of Corona beer, also invested more than $4 billion in Canopy Growth.

Companies are also taking hard pivots to get in the cannabis stream. Relentless Resources, for example, changed focus from drilling oil to producing cannabis. India Globalization Capital was a heavy machinery corporation, then a bitcoin company, and is now a potco.

Nevertheless, cannabis valuations have the advantage of actual revenues. Not projections. And while stock price increases are reminiscent of bitcoin, that fact is a major differentiator.

Written by Rob McLean

Rob loves staying on top of developments in the cannabis sector, and always has his finger on the pulse of real estate markets.

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