Cannabis Stocks In 2021
As marijuana stocks close the second week in May most leading cannabis stocks to invest in are showing some upside in the market. After the first-quarter rally in February top pot stocks have lost substantial value in the market. On the other hand, most cannabis companies continue delivering strong revenue gains and record earnings that should not be overlooked by investors. In the US the cannabis industry continues to show bullish potential in 2021.
In April cannabis sales in Michigan increased by 149% to $153.8 million. Additionally, the top companies in the US have given some rather significant increases in revenue guidance for 2021. For the most part, this is currently being delivered by some of the top marijuana stocks to buy in their first-quarter results. It goes without saying the cannabis market has substantial growth potential for the next five years. But at the moment the cannabis sector seems to need a kick start from the US federal government in the form of cannabis reform.
With the SAFE Banking Act on the Senate floor through a bipartisan committee. Chuck Schumer continues to reiterate that he is currently working on introducing a bill shortly. The senator wants to pass a cannabis legalization package before the banking reform policy. Either way, cannabis investors will have to be patient and wait for this market catalyst at the moment.
Finding Value In Penny Stocks
Due to the fact, top cannabis stocks have not been showing increases from their first-quarter reporting it may be time to look in other areas of the marijuana sector for larger short-term returns. One part of the cannabis sector that's shown significant upside this year is top marijuana penny stocks. When we speak about penny stocks technically, we are talking about any securities trading under the $5 per share benchmark.
In 2021 these penny stocks saw the most gains in the February rally. Although many have given some of these gains back in recent trading some are still up triple-digit percentage gains year to date. Before investing in cannabis penny stocks there are a few important factors to consider. For one, the best penny stocks are known for being some of the most volatile stocks in the market.
Because of this more investors prefer to establish short-term positions and take advantage of price fluctuation. Whatever your trading style pot penny stocks are known for being a high-risk high rewards part of the market. This is because investors can use much less capital to establish a larger position in these equities. As we close the second week in May these could be the top marijuana penny stocks to watch right now.
Marijuana Penny Stocks To Watch:
The Valens Company Inc.
As a leading manufacturer of cannabis derivative products, The Valens Company Inc. provides processing services, product development, and supplies consumer packaged goods for the cannabis industry. Specializing in high-quality products for both the medical and recreational cannabis markets the company continues expanding its portfolio. In detail, Valens acquired one of the top Canadian edible manufacturers LYF Food Technologies Inc. to strengthen its production capacity and unlocks future growth potential.
In its most recent earnings, Valens reported its first-quarter fiscal 2021 gross revenue of $21.8 million up 21.4% versus Q4 of 2020. The company also saw product sales increase 23.3% to $17.9 million. In April Valens company entered into an agreement to acquire a leading CBD company Green Roads entering into the US market. Also, important Valens has filed the initial application for listing on the NASDAQ after its first US acquisition.
VLNCF stock is up 17.96% on May 14th heading into the close of the trading day. In May VLNCF stock has a high of $3.31 per share and has gained 22.68% during the last month. According to analysts at Tip Ranks VLNCF stock has a 12-month average price target of $3.29 per share. In essence, this represents a 14.24% increase from current levels. For this reason, VLNCF stock is a top marijuana penny stock to add to your watchlist for next week.
Fire & Flower Holdings Corp.
In the Canadian sector, Fire & Flower Holdings Corp. is an adult-use cannabis retailer focusing on the Canadian market and international expansion. For starters, the company provides the best-in-class retailing while the HifyreTM digital platform connects consumers with cannabis products online. Earlier this year Fire & Flower announced it entered the U.S. cannabis market through a licensing partnership. Primarily, the licensing partnership and acquisition option with American Acres provides the company with entry into the California, Arizona, and Nevada markets once complete.
Additionally, Fire & Flower subsidiary Hifyre entered into an agreement with leading U.S. analytics company BDSA. With this Hifyre IQ will become available in the U.S. cannabis market. In April the company announced record fourth quarter and fiscal 2020 results. Specifically, Q4 revenue increased 157% to $43.2 million year over year. In fiscal 2020 Fire & Flower achieved total revenue of $128.1 million and a gross profit of 35.5%. Also, same-store sales for the quarter are up by 36.8% from a year prior.
FFLWF stock is up 17.91% year to date closing on May 14th at $0.82 per share. In February FFLWF stock reached a new high of $1.20 and is down 12.62% in the last month. According to analysts at Market Beat FFLWF stock has a consensus price target of $1.80 per share. In essence, this would be a 124.5% increase from current levels. With this in mind, FFLWF could be one of the best marijuana penny stocks to buy in 2021.
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