This year has been a rollercoaster ride for marijuana stocks, and investors have their reservations about pot stocks. I would not be surprised if you have stepped away from cannabis-related stocks after the kind of year the legal weed industry had so far. At the same time, it could be an exciting year to get back to it.
The recent round of sell-offs is fresh in the minds of investors. I still feel you have plenty of opportunities to consider if you’re willing to give some weed stocks a good look again.
There is a chance that weed stocks can fight their way back up again to make it big. Today I am going to talk about three marijuana company stocks that you should consider buying before they explode.
Completely organic and with a lot of potential
The Green Organic Dutchman (TSX:TGOD) is a weed company based on purely organic produce. TGOD goes through a lot of effort to make sure products are free of fertilizers and pesticides sourced synthetically.
At the time of writing, TGOD stocks cost $2.61 per share at writing, and I feel that this is an excellent price for a company with tremendous growth potential.
Things are looking up for the legal marijuana industry. TGOD is a company that exemplifies this. The projected annual production capacity for the company stands at 219,000 kilograms. Once the company meets those production figures, TGOD will become one of the five top cannabis producers in Canada.
Once TGOD’s facilities are all running at full steam, the company’s sales of $39.1 million in 2019 can increase to $227.9 million, a substantial increase of over 480%. TGOD’s three-year agreement with Neptune Wellness Solutions for extraction services, the Valleyfield campus and increase in production capacity means the company can see a massive boost in 2020.
Amazing sales for Village Farms
Village Farms is making considerable waves in the cannabis industry with the six operating greenhouses located in the U.S. and Canada with around 209 acres of growing space.
While the six months that ended on June 30, 2019, showed only a 2.36% increase in sales, Village Farms has a massive sales potential for 2020 onward. Village Farms is already healthy in terms of profitability. The past three quarters in the green can attest to this fact.
The best card in Village Farm’s hand is the partnership the company has with Pure Sunfarms through the Delta 3 greenhouse. Once in full capacity, the facility will allow Village Farms to scale up operations drastically to compete with the large-cap companies in the weed industry.
I think that the $15.44 per share at the time of writing is a reasonable price to get in on the game before Village Farms stocks explode.
A stock that might be on FIRE
Supreme Cannabis (TSX:FIRE) has a price of $1.42 a share at the time of writing. There are a few reasons I think this is an excellent time to buy-in on the company. At the moment, Supreme Cannabis has an estimated 50,000 kilograms of production capacity.
The company has agreements with eight provinces in Canada, and is expanding operations internationally.
The operational strategy for Supreme is focusing on high-quality products, thereby providing the company with a high margin of profit. The domestic recreational marijuana market comprises low-cost cannabis.
The people who want to pay more for better products do not have a lot of options to consider, but Supreme wants to and change that.
Supreme has five brands and several partnerships. One of the company’s brands, 7ACRES, is transitioning from a wholesale business to a premium consumer brand.
Supreme’s collaboration with PAX Labs and the opportunities for the company in South Africa are also promising signs.
The company expects the net revenue for fiscal 2020 to be between $150 million and $180 million, along with a positive adjusted EBITDA. I feel that these signs make Supreme well-positioned for significant profitability, making it a stock you should watch closely.
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Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns shares of Village Farms International, Inc.