Cannabis, psychedelic and plant-based food stocks performed terribly in 2022 and the smallest capitalized among them were down 84% so one could be excused for thinking that they have probably reached bottom and that such a massive decline could well offer major - dare I say "multi-bagger" - returns in 2023. Keep in mind, however, that just because stocks suffer major declines doesn't mean that they will rally. The cannabis sector, for example, declined 64% from its peak in 2021, and then declined another 70%, in total, in 2022 (source). That being said, however, the market is very oversold and, as such, I am optimistic that the market will perform better in 2023.

I think now might be a great opportunity to invest in some of the stocks below (they are not recommendations so do your own research) even though I acknowledge that we could potentially see lower prices before they begin to rise in earnest and that any bear market impacting stocks overall could further rein in enthusiasm for such stocks.

Last week I put together a basket (see here) of 14 stocks for 2023 - aptly named the "Rags-to-Riches" Portfolio -  which have market capitalizations of at least $400M, and trade for at least $1/share. In this article I am introducing a basket of 10 stocks with market capitalizations between US$100M and US$399M - named A Potential "Multi-bagger" Portfolio - which includes their closing prices as of December 31st, 2022, and their performances in 2022, as follows, in alphabetical order:

American Cannabis MSOs: (Read: The 12 Largest American Cannabis MSOs Collapsed 73% In 2022)

1. Acreage (ACRDF/ACRHF): Y/E 2022 Mkt. Cap.: $141M; Y/E Stock Price: $1.20; 2022 Performance: -51.9%
2. Ascend (AAWH): Y/E 2022 Mkt. Cap.: $163M; Y/E Stock Price: $1.30; 2022 Performance: -80.2%
3. Ayr (AYRWF): Y/E 2022 Mkt. Cap.: $124M; Y/E Stock Price: $1.21; 2022 Performance: -92.0%
4. Jushi (JUSHF): Y/E 2022 Mkt. Cap.: $246M; Y/E Stock Price: $0.74; 2022 Performance: -77.2%
5. Planet 13 (PLNHF): Y/E 2022 Mkt. Cap.: $245M; Y/E Stock Price: $0.68; 2022 Performance: -76.6%
   • Sub-total: Ave. Y/E Mkt. Cap: $184M ; Ave. Y/E Stock Price: $1.03; Ave. 2022 Performance: -83.6%

Canadian Cannabis LPs  (Read: The 5 Largest Canadian Cannabis LP Stocks Collapsed 66% In 2022)

1. Aurora (ACB): Y/E 2022 Mkt. Cap.: $358M; Y/E Stock Price: $0.89; 2022 Performance: -83.5%
2. Organigram (OGI): Y/E 2022 Mkt. Cap.: $292M; Y/E Stock Price: $0.78; 2022 Performance: -55.4%
   • Sub-total: Ave. Y/E Mkt. Cap: $325M ; Ave. Y/E Stock Price: $0.84; Ave. 2022 Performance: -76.5%

Psychedelic Drug Stocks (Read: 6 Largest Psychedelic Drug Stocks Were -20% In December)

1. Seelos Therapeutics (SEEL): Y/E 2022 Mkt. Cap.: $100M; Y/E Stock Price: $0.65; 2022 Performance: -60.5%
2. Cybin (CYBN): Y/E 2022 Mkt. Cap.: $100M; Y/E Stock Price: $0.29; 2022 Performance: -75.8%
   • Sub-total: Ave. Y/E Mkt. Cap: $100M ; Ave. Y/E Stock Price: $0.47; Ave. 2022 Performance: -66.8%

Plant-Based Food Stock (Read: Largest Plant-Based Food Stocks Index Collapsed 83% In 2022)

1. Tattooed Chef (TTCF): Y/E 2022 Mkt. Cap.: $121M; Y/E Stock Price: $1.24; 2022 Performance: -92.0%

Grand Total:

• Ave. Y/E Mkt. Cap: US$189M;
• Ave. Y/E Stock Price: US$0.90;
• Ave. 2022 Stock Performances: -84.1%

As you undoubtedly know, the term "multi-bagger" refers to a double, triple, 4-fold, 500%, or more, return in a stock and is used for this portfolio because its constituents would have to advance 6-fold (i.e. 600%), on average, just to get back to where they stood at the beginning of 2022 making a multi-bagger return a distinct possibility in 2023..

Beginning next week, , I will report on the performance of the Portfolio, and that of each of the 10 constituents, with any pertinent information as to the reasons for any major moves one way or the other.

More By This Author:

Tilray Brands: Q2 Financial Metrics All Declined
Cannabis Category Performances Ranged From +5% To -3% Last Week
Largest Cannabis MSOs Up 5% Last Week; Down 40% Since Nov. 30/22