Cannabis stocks surge as U.S. midterm elections bolster hopes for a green wave

Wednesday, May 14th, 2010 | Author: admin | United States Midterm elections are likely to be ushered in a green wave, with only a few months left in the world.

The ETFMG Alternative Harvest exchange-traded fund

MJ + 2.26%

jumped 3.3%, with 28 of 37 higher trading components, putting it on track for a seventh straight gain. The sector tracker has run TK% during its win streak.

The Horizons Marijuana Life Sciences ETF

HMMJ, + 2.63%

rallied 2.4%, also headed for a seven-day win streak.

Among the most-active stocks, Aurora Cannabis Inc.

CBA + 2.30%

rose 3.4%, Canopy Growth Corp.

GSC -0.42%

tacked on 1.8%, Cronos Group Inc.

CRON, + 0.33%

gained 1.6% and Tilray Inc.

TLRY, + 15.09%

ran up 18%.

Michigan became the 10th state – and the District of Columbia – which voted to legalize marijuana. Although South Dakota voted in favor of legal measures, Missouri and Utah.

But that's not all. Democrats winning a majority in the House of Representatives for the first time in a radical change in the US legislative landscape that could usher in a period of positive cannabis reform, "GMP Securities analyst Robert Fagan wrote in a note to customers .

"For instance, Dems will now gain control of the powerful House Rules Committee, which previously had a dogged gatekeeper of positive cannabis reform for the past 2 years under the oversight of anti-cannabis Republican Pete Sessions," Fagan wrote, with Sessions Los Angeles House of Texas to Democrat Colin Allred.

Do not miss: Opinion: Marijuana wins in the midterm elections, but the biggest prize is still ahead.

"In our view, these midterm results combined with a large pipeline of potential catalysts should be decoupled from multiple valuation for the US cannabis sector to eventually reach a premium over Canadian LP peers," Fagan wrote.

Canaccord Genuity analyst Bobby Burleson said he believes Michigan is a "particularly important market" given the state's population. He estimates Michigan's marijuana market to grow from a value of about $ 856 million in 2018 to $ 1.3 billion in 2022.

Gubernatorial wins by a pro-cannabis candidate in Illinois and by the first Democrat in Nevada since 1994 should be viewed for U.S.-based cannabis companies.

Among U.S. Companies Poised to Benefit from Illinois and Nevada Results, According to Burleson, Shares of MedMen Enterprises Inc.

MMNFF, + 2.82%

rallied 3.6% and Planet 13 Holdings Inc

PLNHF, + 3.10%

hiked up 1.8%.

In other pot stocks, shares of Toronto-based Namaste Technologies Inc.

NXTTF, + 3.31%

Cannmart Inc. has signed an agreement with AgMedica Bioscience Inc. to buy medical cannabis from AgMedica to sell on Cannmart's online platform. AgMedica is a licensed producer of medical cannabis under the Access to Cannabis for Medical Purposes Regulations (ACMPR), which holds cultivation and sales licenses.

MariMed Inc.'s stock

Mr RMD, + 5.67%

Charles Finnie, most recently a senior research analyst at Roth Capital Partners, its chief strategy officer, its head of merger-and-acquisitions, investment and investors relations strategies.

Also read: Everything you need to know about CBD, the cannabis elixir that does not get you high.

Elsewhere, shares of GW Pharmaceuticals PLC

GWPH, + 4.35%

rallied 3.9%, Aleafia Health Inc.

ALEAF, -7.98%

fell 6.3%, Green Organic Dutchman Holdings Ltd.

TGODF, -5.29%

shed 2.9%, Hexo Corp.

HYYDF, + 1.35%

Advanced 2.7% and Supreme Cannabis Co. Inc.

SPRWF, + 4.26%

advanced 5.0%.

The ETFMG ETF has so run up 33% over the past three months and the ETF Horizons has soared 36%, while the S & P 500 index

SPX, + 1.87%

has lost 20%.

Check out: MarketWatch's comprehensive coverage of the cannabis sector, including profiles of a number of key players, in one place.