Ride the Medical Marijuana Boom Higher With Cronos Stock
If you’re a true contrarian, you should look at cannabis stocks in 2023. A premier player in this abandoned stock sector is Cronos (NASDAQ:CRON). I believe that the severe multi-month beat down in CRON stock is overdone and a recovery is on the horizon.
The promise of hyper-growth during the peak of Cannabis 2.0 in 2018 hasn’t come to fruition yet.
Yet, Cronos is still making headway as a top-tier producer of cannabis and related products. And if you’re bullish on medical marijuana in particular, you should definitely put Cronos on your watch list.
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New Legislation Could Catalyze CRON Stock
It’s hard to believe that CRON stock has declined from $21 in early 2019 to just $2 recently. That’s an excessive drawdown, as Cronos hasn’t shrunk 90% as a business.
The company is only expanding its global market presence – but we’ll get to that topic in a moment. First and foremost, Cronos’s primary catalyst for growth could be pro-cannabis legislation.
Don’t get the wrong idea here. Cronos doesn’t need the U.S. government to fully decriminalize cannabis. After all, the company is getting very close to breakeven on a per-share basis.
But then, it certainly wouldn’t hurt Cronos if the U.S. finally achieves full decriminalization of cannabis.
It’s all about the baby steps now, as the U.S. Department of Health and Human Services recently called for cannabis to move from Schedule I to Schedule III (i.e., a less restrictive classification).
Furthermore, the SAFER Banking Act is heading for consideration in the Senate. That bill would provide easier access for registered U.S. cannabis businesses to business loans and certain financial protections.
Just think about how high CRON stock could move if this bill becomes the law of the land someday.
Cronos Expands Its Medical Marijuana Footprint
Even though Cronos could benefit from pro-cannabis legislation in the U.S., the company is looking beyond North America’s borders.
Thus, while Cronos offers its Peace Naturals medical cannabis products in Canada, there are other geographic regions to be explored and conquered.
Take Israel as an example. Cronos’s second-quarter revenue in Israel totaled $5.4 million. In that country, Cronos sells its Peace Naturals branded dried cannabis flower, pre-rolls and oils.
Moreover, Cronos recently started shipping Peace Naturals products in Germany. The company plans to establish Peace Naturals as a “top medical brand, similar to the brand’s reputation in Israel,” declared Cronos CEO Mike Gorenstein.
Cronos’s press release touted Germany’s “recently announced regulatory changes. . . to reschedule cannabis and no longer label cannabis as a narcotic.”
In time, North America, Israel and Germany could all provide significant revenue streams for Cronos as an ambitious medical marijuana product provider.
CRON Stock: Your Time Will Come Soon
Cannabis companies generally, and Cronos in particular, have been undervalued and underappreciated by the financial markets. If there’s a bounce-back in 2023 and 2024, it could be powerful.
Ask yourself: Could pro-cannabis legislation benefit Cronos? Is the global medical marijuana industry poised for growth?
If you answered yes to both questions and can tolerate some risk, then you should consider investing in Cronos. I expect CRON stock to make a run for $4 by the end of 2024, so feel free to start a share position today.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.
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