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What's your thoughts on marijuana shares?

Discussion in 'Beginner's Lounge' started by pearcey29, Nov 12, 2018.

  1. pearcey29


    Likes Received:
    Nov 5, 2018
    Ok so obviously I am very new to the share market so this could be a stupid question sorry if it is. But I just wanted to get some people's opinions on marijuana share's specifically Cann group shares from some of the stuff I am reading there are a lot of differing opinions out there on this. some were saying there not making any profit at the moment so steer clear altogether, then i read somewhere else that with in 5 years the industry will be worth $55bil
    is it worth considering??
  2. greggles

    greggles I'll be back!

    Likes Received:
    Jul 28, 2004
    If this is the case then how are revenues going to be generated and by which companies?

    I would steer clear until there is a little more certainty about the industry. We're dealing with something that is still illegal to even possess in Australia, so there are no guarantees that a viable and sustainable industry is going to built on the back on its medicinal use. Too much risk and uncertainty for me and far too much hype.

    Look at Queensland Bauxite (QBL). That company has been in a trading halt since July when it announced the acquisition of two medical cannabis companies in an all-scrip deal that started to fall apart when the QBL share price started to sink following the announcement. Three and a half months later and it's still suspended from trading.

    Some info here for those interested: https://www.tga.gov.au/medicinal-cannabis-guidance-documents
    Darc Knight likes this.
  3. ducati916


    Likes Received:
    Feb 13, 2006
    Of 100 cannabis related firms tracked by Bloomberg, which have a market cap $76Bn, they only have $2.5Bn in revenues.

    That essentially means that they are trade-able, but likely not of investment grade yet.

    jog on
    Darc Knight and galumay like this.
  4. galumay

    galumay learner

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    Sep 17, 2011
    Pretty much what @ducati916 says, even if the sector becomes viable in the future, like any sector you have to find businesses that are actually profitable and able to grow into the future, are well managed and available at a price that is a sufficient discount to fair value.

    Or you can just gamble and buy one of the pot stocks now, or go to the casino and put it all on red, or buy some bitcoins.
    Darc Knight likes this.

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