Top Marijuana Stocks to Watch for 2024

It’s time to revisit marijuana stocks.

It’s been a hot sector for traders in the past… 

We haven’t seen too many big sector moves in this niche for a while. But the cannabis industry is still in its infancy. And upcoming changes could fire it up again.

So prepare now. You have to know when different industries are about to move. 

Let’s look at why this one might be packed with potential…

What Are Marijuana Stocks?

This sounds like a basic question … but it’s worth defining before we get into strategy.

Marijuana stocks, aka weed or cannabis stocks, include more than just companies that sell pot. This market includes three categories of businesses…

Retailers and Growers

These businesses grow cannabis and distribute products to customers. Some of them also operate retail stores.

Cannabis Biotechs

These companies develop drugs from the compounds in hemp or cannabis — think THC or CBD.

Suppliers

There’s huge growth in the marijuana market … That creates new demands. 

To support that growth, these companies need more — and new — products and services like hydroponics and lighting systems, packaging products, management services, and marketing.

So companies in the supplier category provide solutions for these industry-specific needs. 

Why Trade Marijuana Stocks?

Part of a trader’s job is to watch what’s going on in the world and seize opportunities.

The World Health Organization says marijuana is the world’s most commonly cultivated, trafficked, and used illicit (depending on where you live) drug … So the demand’s there. 

Plus, there’s growing pressure for legalization around the world. Marijuana is currently legal for medical use in 34 countries. Some — like Canada — have fully legalized it. Several states here have legalized it too. And more are to come. 

So there’s a lot of growth in the marijuana market, and it’s understandably grabbing the attention of businesses, analysts, and investors.

In the U.S. alone, the legal marijuana industry is worth about $13.5 billion today. And it’s expected to grow nearly 27% each year through 2028. 

Imagine the potential if the U.S. legalizes it … The opportunity is so big that some analysts believe it could surpass the soda industry!

How to Choose the Best Marijuana Stocks to Trade

Trading marijuana stocks is the same as other stocks. 

You must do your research to understand what you’re buying. Build a solid trading plan that’s tailored to your strategy … and stick to it.

Before you enter a trade, make sure the chart patterns, indicators, and fundamentals all match your setups. 

Establishing solid decision-making processes is exactly what we do with the SteadyTrade Team. It’s part of the foundation you need as a trader. And it’s something you can apply to all your trades, no matter the sector or trend.

Speaking of trends … Here’s where marijuana stocks can differ: industry trends. The industry is so new, big changes can happen quickly. So it’s important to watch for trends, news, or catalysts that can affect price behavior. Let’s look at a few of those trends…

Trends and News Influencing Marijuana Stocks

If you want to trade marijuana stocks, you better know the catalysts. Let’s break those down…

Legalization

Marijuana is still illegal under U.S. federal law. But the closer we get to federal legalization, the easier it’ll be for businesses to start and grow. You need to watch for that. It’s a huge catalyst.

Currently, marijuana is legal for adults over the age of 21 in 15 states and legal for medical use in 36 states. Illinois made marijuana sales legal on January 1, 2020, and topped $5.4 million in sales in just the first two days.

According to a Pew Research survey, 60% of Americans believe in the full legalization of marijuana. 

Bank Reform 

Banks and credit unions are hesitant to get involved with marijuana companies because of legal issues. Few of them provide even basic financial services to pot businesses. And that forces these companies to deal in cash and get creative with financing. 

Bills like the SAFE Banking Act can bring banks closer to marijuana companies. The bill passed in April, but changes will likely take years to implement.

FDA and CBD

Cannabidiol (CBD) is the non-psychoactive compound of cannabis and hemp. It’s known for its perceived medical benefits. 

CBD’s been the darling of marijuana stock investors since former President Donald Trump signed the Farm Bill into law in December 2018. That bill legalized the industrial production of hemp and hemp-derived CBD. 

But the U.S. Food and Drug Administration (FDA) followed that up with a warning to consumers about CBD’s side effects. This cast doubts over whether it’ll green-light CBD as a possible food additive in products. Some states are pushing back on that decision, but the battle’s likely far from over.

Watch for developments on this story…

Profitability

Marijuana businesses face a lot of difficulties and constraints. And that can push sales estimates down and move loss projections up.

Investors look for profitable marijuana companies. This means earnings releases could affect weed stock price movements in 2021.

What Are the 5 Hottest Marijuana Stocks of 2024?

Remember this is a watchlist. Only use this list of stocks to watch as a guide. Always do your due diligence before every trade and never risk more than you can afford to lose.

That said, here are some top marijuana stocks to watch in 2024…

Hot Marijuana Stocks #1: Green Thumb Industries Inc. (OTCQX: GTBIF)

Fitting for a marijuana stock … Green Thumb Industries has plans for growth in the near future.

This OTC stock holds licenses for 96 retail cannabis locations but owns just 12 stores and 13 manufacturing facilities. Do the math — it’s planning to grow.

The company benefitted when Illinois legalized weed in 2020. It’s planning to pursue growth there … as well as expand into New York and New Jersey soon.

Green Thumb increases its cash flow quarter by quarter. Continued growth should help that remain true.

It’s slowly chugging toward yearly highs…

Hot Marijuana Stocks #2: Trulieve Cannabis Corp. (OTCQX: TCNNF)

Trulieve Cannabis is a grower and retailer focused on Florida’s medical marijuana market. It accounts for nearly 50% of the state’s total cannabis sales. 

The company’s been profitable since 2017, which is rare for a marijuana company.

Trulieve announced in May its plan to acquire Harvest Health & Recreation for $2.1 billion. This would give Trulieve access to markets outside of Florida, with a total coverage of 126 dispensaries in 11 states — selling for both medicinal and recreational uses.

The company’s already dominant in Florida. This Harvest Health acquisition gives it an opportunity in 10 new states…

TCNNF has zagged down in recent months, but the right catalyst could send it flying.

Hot Marijuana Stocks #3: Innovative Industrial Properties Inc. (NYSE: IIPR)

Innovative Industrial Properties is a cannabis-focused real estate investment trust (REIT).

It isn’t a low-priced stock, but it has a relatively low float. It’s also done well compared to other marijuana stocks since its IPO.

Part of the reason this company’s done so well is that it helps other marijuana businesses overcome the financing problems we discussed earlier. It acquires growing or processing facilities for cash … then leases the property back to the same company for a 10–20 year period.

The company started in 2019 with only 11 properties in nine states. It grew to 46 properties in 14 states by the end of that same year! 

If you like higher-priced stocks, this could be a good candidate for your watchlist. And it’s close to pushing yearly highs…

Hot Marijuana Stocks #4: Canopy Growth Corp (NASDAQ: CGC)

Weed stocks are BACK.

This sector comes and goes. It’s never been the strongest sector in my opinion, but we have to respect CGC’s price action. The stock already spiked 260% in March.

And this price action isn’t random.

Over the last few weeks there’s been a lot of talk about marijuana legalization. Both in the U.S. and worldwide:

• POTUS Biden and VPOTUS Harris both recently expressed an interest in reforming the U.S. approach toward marijuana.
• Germany decriminalized marijuana.

But CGC is also running thanks to a catalyst that was announced on March 14.

• There’s a potential acquisition looming. The vote deadline for the acquisition is April 10. We learn the results of the CGC vote on April 12.

This is a classic case of a forward looking statement causing bullish momentum. And the global events within the weed sector are exacerbating the hype.

We can take advantage of that … 

First and foremost, you need to keep an eye on past price action to determine levels of support and resistance. Stocks like to bounce between these levels. I drew some lines on the chart below that show support and resistance, notice how the stock bounces between these levels from left to right:

CGC chart multi-day, 3-minute candles Source: StocksToTrade

Our goal is to identify the strongest stocks and build positions near support. If the price falls below support we cut for a small loss.

But ideally we focus on the best plays and the price bounces off of support for a profit opportunity.

Hot Marijuana Stocks #5: Scotts Miracle-Gro Co. (NYSE: SMG)

Scotts Miracle-Gro is another hydroponics star, thanks to its Hawthorne Gardening subsidiary.

You know Scotts … the company that sells lawn and gardening products. It’s only natural to add marijuana to its portfolio.

Scotts isn’t a pure weed play, but Hawthorne will certainly keep them rooted in the game. 

SMG has been on a downtrend for quite some time now. As always, study up before hopping in.

Marijuana Stocks Over the Years

Let’s get some perspective on this sector…

Performance of Marijuana Stocks in 2019

Expectations for marijuana stocks in 2019 were sky high, but by the end of the year, it was a big disappointment. The overall market had one of its strongest years in a long time, but the marijuana market had one of its worst.

The first quarter started with promise — more than a dozen pot stocks rose at least 70%. After that, the market spiraled down, and many cannabis stocks lost a significant amount of their market cap.

Doubters of the niche started to surface, of course, but you’d be a fool to count it out. 

Remember, this is a new and growing industry that didn’t exist before, at least from a government tax revenue perspective. Growing pains are normal.

That’s why if you want to uncover big potential opportunities, you need to equip yourself with the best fundamental and technical tools on the market. Don’t just rely on what some traders say in chat rooms. 

I use StocksToTrade every day because it allows me to filter down to the hottest opportunities, manage multiple watchlists, and much more. Try StocksToTrade for 14 days for just $7.

Performance of Marijuana Stocks in 2020

Let’s be clear: 2020 was tough for stocks across the board. 

Like most other sectors, marijuana stocks tumbled right out of the gate and slowly rose throughout the year. Many of those stocks ended 2020 with some solid gains.

The election helped the weed market. More Democrats in power could mean higher odds of nationwide legalization.

And multiple states legalized the recreational use of marijuana, including New Jersey, Arizona, South Dakota, and Montana. Not only did that increase the count from 11 to 15 states, but those states contain one-third of the country’s population. That’s good for business!

South Dakota also legalized weed, but only for medicinal use. That pushed the number of legal states up to 36.

So sure, the market was bumpy in 2020, but more legal weed markets helped marijuana stocks have a strong year.

Future of Marijuana Stocks in 2024

I believe weed stocks can offer compelling opportunities for traders. But be realistic about this industry’s growth. The problems the marijuana industry faces won’t be solved overnight…

Marijuana is legal across Canada, but the country still struggles with supply and distribution issues. That’s partly due to license delays at the government level. But Canada’s situation is a reminder that even if there’s high demand for a product, that doesn’t mean that profits will flow right away.

We may see a thinning out in the number of weed companies due to the different financial challenges in the industry. But we may also see companies take a more cost-focused approach.

And as we’ve already seen with the stocks on this list, mergers and acquisitions may become more common. Moves like these represent great growth opportunities for traders.

There’s no bill yet in the Senate about this, but Senate Majority Leader Chuck Schumer is expected to bring something to the floor later in the year. Monitor the news to stay a step ahead!

And tune in to my Pre-Market Prep sessions … Before every trading day starts, I go LIVE on multiple platforms at 8:30 Eastern. You don’t want to miss potential weed stock talk, do ya?

Marijuana Stocks to Watch in 2024: Conclusion

There’s no sure thing in the market. Marijuana stocks are no different.

These stocks move big and can swing quickly off of news. That can mean great trading opportunities.

The weed sector runs on hype, which contributes to its crazy peaks and valleys. The market builds up expectations and if companies can meet those expectations that sink or spike stock prices.

Anyone in this game knows laws don’t change quickly. Waiting around for federal legalization may leave you disappointed.

It may come, but trading with that expectation could drain your potential profits.

The companies on this list, and some off of it, still have strong markets as is. Many of them have carved out a niche in particular states and are making bank.

Keep the future in mind, but don’t trade solely off the hype. 

And remember that the news can move these stocks. So add the StocksToTrade Breaking News Chat to your trading day. Two Wall Street pros comb the news to help you find the hottest stocks catalysts. Grab your 14-day trial of STT + BNC today for just $17!

Do your due diligence, make your watchlist, and set your expectations before entering a trade. That can make or break your shot at success … with marijuana stocks or trades in any other sector.

What do you think about marijuana stocks? Let me know in the comments below!