Here’s Why it’s Not Too Late to Buy Cronos Group Stock

The optimism about U.S. federal marijuana legalization and its anticipation are potent bullish triggers for the Canadian cannabis industry.

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It’s standard for investors to miss out on winning opportunities and bullish trends. Some are simply missed because they happen in stocks that tend to fly under the radar. Others might be recognized too late by the investors. And while Cronos Group (TSX:CRON) may seem like such a missed opportunity to some investors, it’s not for several reasons.

The company

Cronos Group is currently one of the largest cannabis stocks trading on the TSX right now, boasting a market capitalization of $1.45 billion. It’s an international Cannabis company with a presence in three markets — Canada, Israel, and the U.S., though the latter is through a strategic partnership. It has three brands under its banner, including both recreational and medical.

In Canada, Cronos Group claims to be the second most famous and top edible and flower brand. It’s growing its presence in Israel and the U.S. and is positioned to operate in at least eight states.

Why it’s not too late to buy Cronos

Like many other cannabis stocks in Canada, Cronos experienced a modest bullish surge. It has risen over 45% since the beginning of March, and while it’s not consistent, the stock is still moving upwards. That’s one of the reasons it’s still possible to buy Cronos — i.e., it’s still going up.

We don’t know how long it may continue. The company recently published its results, and they are optimistic enough to inspire confidence in the investors.  

The company has increased its revenue and lowered its losses by quite a significant margin. The positive earnings may allow the stock to keep riding the momentum initially triggered by optimism around U.S. marijuana legalization. This is the second reason buying this stock is not too late.

Even if the U.S. government doesn’t legalize marijuana on a federal level, the optimism around it and the anticipation may prolong the bull market phase of many Canadian marijuana stocks, including Cronos. Several states have legalized cannabis for both medical and recreational use, and new additions to that list can also beef up Cronos stock.

Foolish takeaway

The legal cannabis market inside Canada is still contending with the black market and struggling with regulatory challenges. While it’s not a promising outlook, it indicates that there is still a lot of room for organic growth for companies like Cronos. However, its full potential will emerge when it capitalizes on the growing U.S. and other international markets to which it may develop access over time.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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