The Future of Cannabis: Five Things Investors Need To Know

Courtesy of: Visual Capitalist

The recreational cannabis industry is changing fast, and the last few years have been a blur for investors observing the space.

More people today believe that cannabis should be legal than ever before, and famed investors like Peter Thiel have already made giant bets on the future of recreational cannabis.

Here’s five facts you need to know on the fast-moving industry:

  1. Recreational cannabis is already legal in four states and D.C. It is also available for medical purposes in 20 other states, as well as Canada. Viridian Capital Advisors, which provides research to the cannabis sector, estimates between 6 to 13 states will legalize recreational usage by end of 2016.
  2. Legal cannabis was a $700 million industry in Colorado last year. In 2014, Colorado retailers sold $386 million of medical cannabis and $313 million for recreational purposes. The two segments of the market generated $63 million in tax revenue, with an additional $13 million collected in licenses and fees.
  3. Stocks in the sector have boomed over the last two years. The Viridian Cannabis Index, which covers 60 publicly traded cannabis companies in the United States and Canada, was up 77.5% in 2013, 38.4% in 2014, and 23.6% in 2015 Q1.
  4. Total legal cannabis sales have sailed in recent years With $1.6 billion in sales in 2013, it is expected to increase to $3.5 billion in 2018, which is good for an expected 17% compound annual growth rate.
  5. Nearly half of U.S. states and all of Canada now have access to medical cannabis. That includes 23 states (148.6 million people), 1 district (0.7 million people) and Canada (35.2 million people). That’s 52% of the entire population of the United States and Canada.

The landscape of the cannabis industry is quickly changing. More jurisdictions are turning to legalization of medical and recreational cannabis, and the growth story behind the industry is just beginning for investors.

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Dutchman
Dutchman

I don’t mind if they legalize all drugs – I just don’t want to pay for rehab / social problems.

JIMSKI
JIMSKI

OMG Bravo…….bravo……

Now do the one where the old guy yells GET OFF MY LAWN!

D. B. Cooper
D. B. Cooper

Long overdue to end one moe endless bullshit war? The war on drugs gave the cops free range, now who will they chase around once pot is legal in all States?

Wip
Wip

So sorry to hear you don’t like freedom SSS.

Uncomfortably Numb
Uncomfortably Numb

We looked into investing in cannabis last year. Hubs made a few calls, and had an interesting conversation with an “industry insider”. He mentioned that most of the little guys in the biz are hoping to be bought out in a few years by the Big Tobacco companies (Reynolds, etc). I’m guessing that will start happening once cannabis is legal at the federal level- who knows?

harry p.

Heres an old school RP clip, wonder if SSS if one of the chanters in the audience…

Anonymous
Anonymous

Legalizing the drug for personal use and non commercial production by the user is one thing, creating an industry in it is another.

I favor the first but oppose the second.

And being consistent I feel the same way about alcohol and tobacco.

DRUD
DRUD
SSS

Just got up from a 12 hour nap.

“Most of the little guys in the (marijuana) biz are hoping to be bought out in a few years by the Big Tobacco companies (Reynolds, etc). I’m guessing that will start happening once cannabis is legal at the federal level – who knows?”
—-Uncomfortably Dumb

That’ll happen shortly after the federal government ABROGATES the multi-lateral international treaty it signed outlawing marijuana, which is to say …….. NEVER.

Westcoaster
Westcoaster

Since Cannabis has become “legal” researchers are discovering more and more medicinal uses for it everyday. It’s a natural medicine that has been withheld from the Western world for way too long, and for all the wrong reasons (greed mainly).
It’s about time the Feds completely back off and move it from schedule 1 to maybe schedule 3. It absolutely cannot remain schedule 1 because it has been PROVEN effective as medicine. Schedule 1 substances have NO medicinal value.

Gryffyn
Gryffyn

To Dutchman:
Which do you think is cheaper, paying for rehab and social problems or throwing people in the slammer for the yearly cost of a very expensive college education? Just asking….

Overthecliff
Overthecliff

Taxing this stuff will create a new stream of revenue for the government drones. It will happen. Like lotteries the poor will pay at least a little more of their fair share of graft and corruption.

Rise Up

Agree, Overthecliff–it’s all about government revenue.

Uncomfortably Numb
Uncomfortably Numb

@SSS How clever of you, changing my moniker to Uncomfortably Dumb. So subtle, I almost missed my first TBP burn. It didn’t even hurt that bad.
I guess that’s why I visit this site every day, to learn a thing or two from some admirable, intelligent, and mostly like-minded people.

SSS

@ Uncomfortably Numb. Glad that you didn’t mind your first TBP burn and that it didn’t hurt that much. I specialize in being TBP’s Cuddly Critic. In response to your statement, “We looked into investing in cannabis last year. Hubs made a few calls …. ”

The charts in this article don’t add up. For example, Colorado taxes recreational marijuana at 25% and fails to note that there is a 2.8% sales tax tacked on plus an average of 4% city or county taxes. My primitive math skills tell me that’s a 31.8% tax on recreational pot in Colorado. Won’t compete with the black market. Ever.

Not discussed is that the IRS allows ZERO business deductions for pot stores, growers, or distributors. It can’t because it’s an illegal business under federal law. The actual details of federal taxes for pt business owners are a LOT worse. Let’s get to banks and insurance companies. Won’t get near the industry because of, again, they would be supporting an illegal business and subject to lawsuits violating money laundering laws.

Wow, what a bright picture. So, the logical conclusion is go with your financial advisor and dump every penny you have into the pot industry. It’s a sure get-rich bet. Heh.

SSS

“Since Cannabis has become “legal” researchers are discovering more and more medicinal uses for it everyday.”
—-Westcoaster

Pot became “legal” in Colorado on January 1st, 2014. First state to do so. That was over 630 ago. Name me 630 additional medicinal uses for pot since then. Or 63. Hell, I’ll accept 6 more verifiable uses, dipshit.

Why don’t you just post an article that states pot is more beneficial than aspirin? Guaranteed this fucking idiot will do so from some bat shit pro-marijuana website.

David
David

If not teaching them history, classic literature, or real economics and instead focusing on victims’ studies and microaggresions does not have enough of the kids voting for the corrupt idiot statists, well, try drugging them.

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