The Canadian cannabis sector is on fire. Indeed, a return of approximately 300% for the sector since March lows is worth discussion. Year to date, this sector is up nearly 40%, with investors seeming to get excited about this growth sector once again.
I think we’re heading back into dangerous territory right now with respect to how these volatile stocks are trading. In particular, I think most Canadian cannabis players haven’t deserved the valuation bumps of late. The key catalyst taking this sector higher is speculation around the potential for U.S. legalization. However, most Canadian producers aren’t well positioned presently to take advantage of this significant development.
That said, I’ve picked two Canadian cannabis players I think are deserving of their recent stock price spikes.
Curaleaf
I’ve focused my attention on cannabis stocks almost exclusively to Curaleaf (TSXV:CURA) of late. This is because I view Curaleaf as the only Canada-listed cannabis producer well positioned to take advantage of the potential legalization of marijuana in the U.S.
Indeed, U.S. cannabis legalization is the biggest catalyst this sector has seen in a long time. The U.S. market is the crown jewel every company is chasing after right now. The thing is, Curaleaf is already operating in the U.S. in a big way. Furthermore, this company has done an incredible job of building out a vertically integrated business model that I think is the envy of most of its Canadian peers right now.
Curaleaf has built a solid presence in
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