3 Pot Stocks That Can Return Sizzling Highs for Investors

Three Killer Weed Stocks with High Prospects

The high-flying marijuana segment is currently taking a breather after the impressive gains earlier in the year. There’s nothing to worry about; it’s simply a market adjustment.

The reality is the demand for marijuana, both recreational and medical, will continue to spike higher, especially as the U.S. jumps aboard.

The widely followed Horizons Marijuana Life Sciences Index ETF (TSX:HMMJ.TO), a barometer of the leading marijuana stocks, retrenched 23% during the past three months, but is holding to a 13.6% gain this year.

Chart courtesy of StockCharts.com

Buying the Horizons ETF helps reduce the risk from holding a single marijuana stock, but for those of you who have the appetite to assume more risk, adding specific marijuana stocks can often make more sense.

I have three small to mid-cap marijuana stocks that I feel provide traders with good risk/reward opportunities.

Canada-based OrganiGram Holdings Inc. (NASDAQ:OGI), with a market cap of $910.0 million, is trading well off from its 52-week high of $8.44 but us up 64% this year.

OGI stock also trades on the Nasdaq, unlike many of the other marijuana stocks that trade only in Canada or on the much more speculative over-the-counter.

Chart courtesy of StockCharts.com

OrganiGram is federally approved in Canada to produce and sell premium-grade cannabis and extract-based products for medical and recreational use.

The company’s facilities are expected to have a production capacity of 113,000 kilograms, or 249,000 pounds, per year.

Tempe, Arizona-based Harvest Health & Recreation Inc. (OTC:HRVSF), with a market cap of $1.45 billion, is a pure play on the U.S. marijuana market.

Trading at the $5.00 level, HRVSF stock is half of its 52-week high, down a whopping 42% over the last three months to compelling levels.

Chart courtesy of StockCharts.com

Harvest Health is a vertically integrated marijuana play, meaning the company is involved in each step, including research, cultivation, and sales.

Really intriguing is the Harvest Health believes it can pay a production cost of less than $1.00 per gram.

The company is currently operating 13 retail locations in five states but is planning to have 100 dispensaries in 14 states by 2020.

Curaleaf Holdings Inc (OTC:CURLF) is the largest of the three marijuana stocks, with a market cap of $3.43 billion, up 60% this year but down 26% over the last three months.

Chart courtesy of StockCharts.com

Also a pure play on the U.S. pot market, Curaleaf is probably the best bet of the three marijuana stocks simply because it has more scale.

The company’s current network is comprised of 45 dispensaries, 12 cultivation sites, and 11 processing facilities spread across the nation.

Analyst Take

Pot stocks are here to stay. The sector will likely undergo some consolidation, but the growth will be staggering, so it makes sense to have some funds in play in the marijuana sector.

Rather than playing the really small marijuana plays, my list of three decent-sized marijuana stocks could return some massive gains in a few years.