The marijuana industry consists of companies directly related to the research, development, and distribution of cannabis products, as well as companies that indirectly support these operations. Traditional stock market indices such as the Nasdaq continue to include more companies from the marijuana industry, as a growing number of regions around the world legalize marijuana. A total of 37 U.S. states now permit the use of marijuana in some form.
Nasdaq-listed marijuana companies include Tilray Brands Inc., Organigram Holdings Inc., and GrowGeneration Corp. Many of these companies managed to maintain fast revenue growth in spite of the massive disruptions caused by the COVID-19 pandemic.
Marijuana stocks, as represented by the ETFMG Alternative Harvest ETF (MJ), an exchange-traded fund, have significantly underperformed the broader market. MJ has provided a total return of -62.5% over the past 12 months, well belowthe benchmark Russell 1000 Index’s total return of-5.2%. These performance figures and all statistics in the tables below are as of May 23, 2022.
Here are the top three marijuana stocks on the Nasdaq with the best value, fastest growth, and best performance.
These are the marijuana stocks trading on the Nasdaq exchange with the lowest 12-month trailing price-to-sales (P/S) ratio. For companies in the early stages of development or industries suffering from major shocks, this can be substituted as a rough measure of a business’s value. A business with higher sales eventually could produce more profit when it achieves (or returns to) profitability. The P/S ratio shows how much you’re paying for the stock for each dollar of sales generated.
GrowGeneration Corp.: GrowGeneration operates retail hydroponic and organic specialty gardening retail outlets. It offers plant nutrition, farming soils, crops, advanced lighting technology, hydroponic and aquaponic equipment, and more. Though GrowGeneration is not a pure play cannabis company, many of its products are used in cannabis cultivation. The company recently announced financial results for Q1 of its 2022 fiscal year (FY), the three-month period ended March 31, 2022. GrowGeneration reported a net loss of $5.2 million, a significant deterioration from net income of $6.1 million posted in the year-ago quarter. Net sales fell 9.2% compared to the year-ago quarter amid weaker demand across the industry.
Aurora Cannabis Inc.: Aurora Cannabis is a Canada-based cannabis company serving both the medical and recreational-use markets. Some of its brands include Aurora Drift, Daily Special, MedReleaf, and CanniMed. The company announced in early May that it has completed its previously announced acquisition of TerraFarma Inc., the parent company of Thrive Cannabis. Aurora paid an initial consideration of CA$38 million ($30 million) and will pay up to an additional CA$30 million in potential earnout amounts, subject to Thrive achieving certain revenue targets within two years.
Tilray Brands Inc.: Tilray Brands is a cannabis-lifestyle and consumer packaged goods company. Its portfolio includes a broad selection of cannabis offerings, hemp-based foods, and craft beverages.
These are the marijuana stocks on the Nasdaq with the highest YOY sales growth for the most recent quarter. Rising sales can help investors identify companies that are able to grow revenue organically or through other means, as well as find growing companies that have not yet reached profitability. In addition, earnings per share can be significantly influenced by accounting factors that may not reflect the overall strength of the business. However, sales growth can also be potentially misleading about the strength of a business, because growing sales on money-losing businesses can be harmful if the company has no plan to reach profitability.
Organigram Holdings Inc.: Organigram Holdings is a Canada-based producer of medical and recreational cannabis. Its subsidiaries include Organigram Inc., Laurentian Organic Inc., and The Edibles and Infusions Corp.
Cronos Group Inc.: Cronos Group is a Canada-based cannabis company focused on advancing cannabis research, technology, and product development. Its international brand portfolio includes Spinach, Happy Dance, and PEACE+. The company announced in March the appointment of Mike Gorenstein as chairman, president, and chief executive officer (CEO). Gorenstein is a founder of Cronos Group and previously served the same three positions until September 2020, when he became the executive chairman. He was named to these roles to replace Kurt Schmidt, who is retiring.
Sundial Growers Inc.: Sundial Growers is a Canada-based cannabis producer. The company operates cultivation and processing facilities, retail stores, and also sells alcoholic beverages. Sundial announced in late March that it has completed its previously announced acquisition of Alcanna Inc. for approximately CA$320 million ($249 million). Alcanna is one of the largest private-sector retailers of alcohol in North America.
These are the marijuana stocks that had the smallest declines in total return over the past 12 months out of the companies we looked at.
Market Cap ($B)
12-Month Trailing Total Return (%)
Sundial Growers Inc. (SNDL)
Cronos Group Inc. (CRON)
Organigram Holdings Inc. (OGI)
ETFMG Alternative Harvest ETF (MJ)
Sundial Growers Inc.: See above for company description.Cronos Group Inc.: See above for company description.Organigram Holdings Inc.: See above for company description.
The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. Though we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.
National Conference of State Legislatures. “State Medical Cannabis Laws.”
YCharts. “Financial Data.”
GrowGeneration Corp. “GrowGeneration Reports First Quarter 2022 Financial Results.”
XE.com Inc. “1 CAD to USD – Convert Canadian Dollars to US Dollars.”
Cronos Group Inc. “Cronos Group Founder Mike Gorenstein Returns as CEO.”
Sundial Growers Inc. “Sundial Growers Completes Acquisition of Alcanna.”
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