• Amplify Seymour Cannabis ETF (CNBS). Like most of this sector’s ETFs, CNBS is short on history—inception date: 2019—which gives investors little to go on for historical performance. However, with a low NAV in the $20 per share range, inventors can get a taste for the industry without risking a positive drug test at the workplace. Shares of CNBS are up more than 72% year over year, although the ETF is well off its it February 2021 highs near $40, making now a great time to jump in. Like other ETFs in the cannabis sector, the expense ratio is high at 0.75%.
• ETFMG Alternative Harvest ETF (MJ). Providing a YTD return of 34% as of early September 2021, this ETF that tracks the Alternative Harvest Index is no slouch. With an at-present highly accessible cost-per-share 0f around $16, investors wanting to try the cannabis industry on for size can do so at a low price of entry. Shares come with a steep expense ratio for a passively managed ETF, though: 0.75%.
The Best Pure Play Cannabis ETFs
• Altria Group Inc. (MO). You’ll know this stock best as the maker of Marlboro and one of the behemoths in the tobacco sector (along with its dabblings in the adult beverage industry). Because of that, for ESG investors, Altria’s likely not an option. For those who don’t mind the vice, the company’s making a play for cannabis, holding a substantial stake in Cronos Group, detailed above. While the stock took a substantial hit from its investment in JUUL, share prices have been near their one-year highs. Analysts have noticed and the stock comes complete with several Buy and Strong Buy ratings and a dividend yield that only stocks in this sector can bear: 7.2%.
• Amyris Inc. (AMRS). Buckle up because this stock has gained nearly 450% since this time last year. Amyris has been working to create synthetic cannabinoids that could revolutionize the industry and make it less reliant on large, expensive growing facilities. With a $4.5 billion market cap, Amyris most recent quarterly results posted quarter-over-quarter sales figures up 74.4%. No dividends to report yet, but investors willing to take on the risk of this up-and-coming stock when it hit a low of $1.88 per share in November 2020 would now hold shares worth over $15 each.
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• Constellation Brands, Inc. Class A (STZ). Spirits are Constellation’s main game, but like Altria, this company is diversifying into cannabis via investment in Canopy Growth (CGC), a Canadian cannabis producer. Holding a 38.6% share of the company, Constellation saw a substantial return on investment in 2020. While not a pure cannabis play, this analyst-favorite stock is having a heyday with a one-year return of almost 15% and a dividend yield of 1.5%.
• Cronos Group (CRON). As a global brand that makes a wide variety of adult-use cannabis and CBD products, year-over-year sales are up a respectable 58%. Maybe it’s the pandemic. Maybe it’s a carefully cultivated reputation for high-quality cannabinoids. Either way, Cronos displays controlled growth, but investors need to have a sense of adventure, with its 52-week price fluctuation between $4.92 and $15.83 per share.
Canopy Growth can’t yet compete in the huge U.S. medical cannabis market, but it is poised to quickly enter if cannabis is federally legalized. The company already has a deal in place to acquire Acreage Holdings (OTC:ACRGF) , which operates cannabis dispensaries in 13 U.S. states.
Data source: Yahoo! Finance. Data current as of July 26, 2021.
These five medical marijuana stocks are top buys for 2021:
Investors should consider the same key attributes for medical marijuana stocks that they would for any stock:
3. Jazz Pharmaceuticals
Investors who opt to buy individual medical marijuana stocks can choose among Canadian or U.S. companies. Canadian medical cannabis companies can legally list on U.S. stock exchanges, while U.S. medical cannabis companies operating legally at the state level can legally list on Canadian stock exchanges and over the counter (OTC).