The 3 Best Cannabis Stocks to Buy in January 2024
With the U.S. presidential election just months away, some of the best cannabis stocks should benefit.
For one, U.S. governors are urging President Biden to reschedule cannabis. Two, as former Food and Drug Administration (FDA) deputy commissioner for global regulatory operations and compliance, Howard Sklamberg commented a few months ago:
“I would be really shocked if it took the DEA longer than the second quarter of next year to come up with its final rule. Even when I was at the FDA, we knew that important regulations that you wanted to get done in an election year, you want to get done by the summer before,” as quoted by Marijuana Moment.
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Expecting to see further favorable action, some of the best cannabis stocks could soar higher, especially as we near the 2024 election.
Innovative Industrial Properties (IIPR)
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Innovative Industrial Properties (NYSE:IIPR), a real estate investment trust (REIT) makes the top of the list of the best cannabis stocks to buy. The last time I mentioned IIPR on Nov. 14, I noted, “Thanks to its 9% yield, which could push even higher, it’s cheap at $80 a share. Further, earnings are coming back strong.”
Shortly after, IIPR would hit a high of $103.23. Now at $93.92 with a yield of 7.75%, I’d use the recent pullback as an opportunity. Even more attractive, IIPR just raised its dividend to $1.82, which is payable Jan. 12 to shareholders of record as of Dec. 29.
Earnings haven’t been too shabby either. In its third quarter, IIPRI posted normalized funds from operations (FFO) per share of $2.09, which was better than expectations for $2.05. It was also above the $2.07 posted in the second quarter. Revenue was up to $77.8 million, which beat estimates for $76.6 million. And rent collection came in at 97%.
Green Thumb Industries (GTBIF)
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The last time I mentioned Green Thumb Industries (OTCMKTS:GTBIF), it traded at $9.40 on Oct. 12.
Now up to $11.23, it could see higher highs, with impressive earnings to boot. In its most recent quarter, the company posted Q3 EPS of five cents, beating by a penny. Also, it posted revenues of $275.4 million, which was up 5.4% year over year (YOY). And, it beat by $18.19 million.
Further, analysts at Jefferies have a buy rating on the stock, with a price target of $31. As noted by Motley Fool contributor Rich Smith, “Green Thumb will succeed in regaining positive free cash flow status by next year [2024] at the latest. Forecasts compiled by S&P Global Market Intelligence, for example, show the company generating positive cash profits of $114 million in 2024 — then more than doubling that number to pass $248 million in 2027.”
ETFMG Alternative Harvest ETF (MJ)
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Or, if you want to safely diversify with top cannabis names at a low of $3.31, try ETFMG Alternative Harvest ETF (NYSEARCA:MJ).
With an expense ratio of 0.75%, the ETF tracks the performance of cannabis companies benefiting from global medicinal and recreational use. While its chart isn’t too attractive at the moment, give it time. Should we see rescheduling and potential legalization at the federal level, the ETF could take off.
Some of its top holdings include Tilray (NASDAQ:TLRY), Innovative Industrial, SNDL Inc. (NASDAQ:SNDL), Cronos Group (NASDAQ:CRON), Canopy Growth (NASDAQ:CGC), and AFC Gamma Inc. (NASDAQ:AFCG) to name a few of the top ones.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.
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