October was a brutal month for marijuana stocks. The entire sector declined dramatically this month. However, the sell-off could be a buying opportunity for savvy traders. Many of these beaten-down pot stocks have bright futures ahead of them, so now could be a great time to get in for cheap. Here are some of the weed stocks that could be worth grabbing for cheap.
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Cronos Group (NASDAQ: CRON)
This former Wall Street darling could be a good candidate for a long-term buy. Cronos is one of the leading Canadian pot stocks, but it got blasted with the rest of the market over the past few months. Despite the losses, shares are still up over 18% through the last 12 months.
Technicals could indicate that CRON is ready to rally in November. It looks like a Doji is forming on the one-month chart. Trading volume also picked up during the month. Sometimes, Dojis preceded a trend reversal, so it could be a sign that CRON is ready to come out of its funk. Keep an eye on this one in November.
Aphria (NYSE: APHA)
Aphria held up better than most of the other marijuana stocks during Bloody October. The company reported its second consecutive quarterly mid-way through the month. Shares popped on the news, but the gains didn’t hold for long. Aphria is down over 8% from its post-earnings bump.
Unlike many of its classmates, Aphria is operating a profitable business. That’s probably the reason the stock held up comparatively well in October. However, profits were not enough to spare Aphria from the widespread bearishness plaguing the cannabis sector. Despite these declines, many analysts still maintain a positive opinion on the company. 58.3% of the 12 analysts that cover the stock rated it as ‘buy’.
Aurora Cannabis (NYSE: ACB)
Aurora is Wall Street’s new favorite pot stock. Out of the major Canadian firms, Aurora looks to have the most stable future ahead. Canadian demand for legal cannabis hasn’t been as strong as anticipated, and that’s driving a lot of the selling in the sector. However, Aurora is already planning to supplement it’s stagnating growth in Canada by expanding to new markets.
During its fourth-quarter earnings call, Aurora highlighted its plan to enter into the U.S. CBD market. The company already took its first steps toward the U.S. CBD market in July, when it entered into a clinical research partnership with UFC. Aurora also entered into an exclusive agreement with Greenlane Holdings for its Storz & Bickel vape products. Full-scale U.S. legalization still seems to be years away, but Aurora’s entry into the American CBD market lays the groundwork for an eventual expansion into the U.S. cannabis market.
Charlotte’s Web Holdings Inc. (OTC: CWBHF)
One of the only American marijuana stocks on today’s lineup, Charlotte’s Web grows hemp and produces CBD products in the United States. The pot stock sell-off affected cannabis and CBD stocks alike, but the outlook remains high for the U.S. CBD market. This divergence between price action and CW’s fundamental outlook could create an excellent opportunity for long-term investors. CW is the market leader in the American CBD market so it’s one of the best candidates for investors seeking exposure to space.
CW has been in a funk since it reported a miss on its quarterly earnings estimates in August, but revenues are still growing substantially and the company’s long-term trajectory remains solid. The firm reported revenue growth of 45% on its report, which would an excellent growth rate for most companies. However, Wall Street was expecting the company to maintain its explosive growth rate from earlier in the year, so the earnings miss created some bearish sentiment towards the stock.
The U.S. CBD market is expected to grow to $23.7 billion in annual sales by 2023, according to Brightfield Group. As the market leader in the CBD sector, CW could be in line to capture a large share of that market. Long-term, there are no obvious problems with this company and many analysts who cover the stock maintain a positive long-term outlook.
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