E 2016 Outlook For Cannabis Sector

TM editors' note: This article discusses a penny stock and/or microcap. Such stocks are easily manipulated; do your own careful due diligence.

Happy New Year. We are excited about the prospects for the marijuana and hemp industry in 2016 and we wanted to share our thoughts.

After the euphoria of investment excitement in March 2014, the stocks and company valuations in the marijuana sector have come down significantly to much more realistic valuations and not just high in the sky dreams. With a 50 to 80% drop in share price over the last 2 years, these cannabis related companies are now worth looking at again. Why? Because we think 2016 is going to be a rewarding year for cannabis related investments, especially the ones generating revenues and growing their business. 

If the Canadian Marijuana Index in the last six months is any indication of how Canadian marijuana stocks performed during the elections, then the US stocks for cannabis related companies should outperform the rest of the market. Here’s Why.Marijuana Index Canada Dec 2015

There has been a lot of excitement in the Canadian medical marijuana industry lately, many of the company share prices have risen as a result of the recent Liberal Party election win and Justin Trudeau's pro stance on marijuana legalization in Canada. We will be sharing out thoughts on this election outcome and what it means for the licensed producers in Canada in the coming weeks and year ahead.  

The chart to the right shows the Marijuana Index Canada and it's performance over the last six months, we can clearly see a rise going into the elections and the recent drop after the Liberal Party win.  Looking at the share price performance over the last month, the rise and fall of this index will give us clues and investment opportunities in the US market as we head into the United States election in 2016.

We expect a similar rise in cannabis related stock price (US and Canada) by the spring of this year, then a retreat into the summer followed by another rise by the end of 2016. We will explain our thoughts behind the stock price movements for next year in an upcoming special report.

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Disclaimer: Remember, any investment does come with some risk.  We are not professional financial advisors; please consult your financial advisor ...

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Carl Schwartz 4 years ago Member's comment

Where can I find out more about investing in this industry?

InvestInMJ 4 years ago Author's comment

We agree, there are going to be some great opportunities over the coming year... however due diligence on the companies is necessary.

Jonathan Garfield 4 years ago Member's comment

What are some good stocks to look into for someone completely new to this field?

Rebecca Moore 4 years ago Member's comment

This is an area I'd like to learn more about, thanks. I got caught up in the fad early on and got burned. But I still thing this is a burgeoning industry with lots of upside potential.

Barry Hochhauser 4 years ago Member's comment

I had a similar experience. I believe there are opportunities, but one must be very careful.