Find The Best Canadian Marijuana Stocks or Pot Stocks to Invest In

Canada’s Liberal government has paved the way for recreational use in the near future, boosting the value of these Canadian marijuana stocks or pot stocks.

Below you will find ten of the best Canadian marijuana stocks covered by our analysts.

SmallCapPower | July 25, 2018:The impending legalization of cannabis in Canada has sent marijuana stocks soaring over the past two years. bBetween the beginning of November 2017 and the end of January 2018, the Horizons Marijuana Life Sciences Index ETF (HMMJ) skyrocketed 92%, peaking in January at $24.33 and , vastly outperforming the TSX-V. Since its high, the Index has fallen 2% to date.

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Win Big With Our Small Cap Picks

The current industry correction may provide a renewed opportunity for investors interested in Canadian marijuana stocks. Though this industry remains volatile, for those investors looking to take on risk to increase their portfolio returns, these are our top 10 picks.

1. Canopy Growth Corp. (TSX: WEED)- $ 33.76

Cannabis

Canopy Growth Corporation, is a diversified multi-brand cannabis and hemp company, offering distinct brands and curated cannabis products with varieties in dried, oil and soft-gel capsule forms. In the past year, the Company has sold 6,200 kg of cannabis products to the Canadian medical market. The Company has also acquired the necessary agreements to export medicinal cannabis to Australia, Brazil and Germany. To position itself in Canada’s recreational market, the Company has secured agreements with the Provinces of Quebec, Prince Edwards Island, New Brunswick, Alberta, British Colombia and Newfoundland & Labrador to supply their adult consumer market with high-quality cannabis. With the recent British Colombia supply agreement, the supply contracts amount to approximately 65,000 kg supplied by Canopy in 2018. Canopy has the largest licensed production platform in Canada, with over 600,000 sq. ft. of production space. To further solidify their leading position in the market, the Company expects to add an additional 5,000,000 sq. ft. of production over the next 12 months. On July 10, the Company announced its acquisition of Hiku Brands Company Ltd., a licensed vertically integrated producer with vast retail operations across Canada.

  • Market Cap: $ 7,338 Million
  • EV/Sales FY2019: 21.3x
  • EV/EBITDA FY2019: 191.1x
  • Cash $323 Million
  • Debt $194 Million
  • 1 Month Total Return: -22%
  • YTD Total Return: 14%

2. Aurora Cannabis Inc. (TSX:ACB)- $ 7.70

Cannabis

Aurora Cannabis is a licensed producer and distributer of medical cannabis. To prepare for the legalization of the adult consumer market for cannabis, the Company is substantially increasing its production capacity. ACB expects to have just under 1,000,00 sq. ft. of licensed production space and plans to produce at least 270,000 kg of cannabis annually. The Company also has 25% ownership interest in Alcanna, formally known as Liquor Stores N.A., the dominant alcohol retail chain in Western Canada. It intends to convert several existing outlets, as well as develop new stores, for the sale of cannabis to the recreational market. These agreements amount to a total of 30,000kg of cannabis supplied in 2018. Aurora has also embarked on an aggressive international expansion strategy that aims to have operations and/or sales in Germany, Denmark, Italy and Australia. On June 20, 2018, the Company announced its plan to spin-off its US assets into a new company, Australis Capital. On July 16, the Company announced an agreement with Shopify Inc, to use their online platform for their ecommerce of medical and recreational cannabis.

  • Market Cap: $ 4,364 Million
  • EV/Sales FY2019: 9.6x
  • EV/EBITDA FY2019: 44.5x
  • Cash $231 Million
  • Debt $209 Million
  • 1 Month Total Return: -23%
  • YTD Total Return: -20%

3. Aphria Inc. (TSX:APH)- $ 11.10

Cannabis

Aphria is Canada’s third-largest cannabis producer by licensed capacity. The Company’s Leamington greenhouse facility provides them with the opportunity to be a scalable, low-cost producer of medical marijuana. APH sells medical marijuana and its derivatives through both retail sales and wholesale channels. Retail sales are sold primarily through the Company’s online store as well as telephone orders. Wholesale shipments are sold to other ACMPR Licenced Producers. By January 2019, the Company expects to increase their cumulative licensed greenhouse growing space to 1,000,000 sq. ft., increasing their annual production capacity from 9,000 kg to 100,000 kg. The Company currently has 44,000 sq. ft. of production space. The Company also recently acquired Nuuvera Inc., granting Aphria the only Canadian license to export medical cannabis to Italy. Using Nuuvera’s assets, it will focus on existing and future opportunities in established international cannabis markets including Germany, Italy, Spain, Portugal, Malta, and Australia. In May, Aphria selected Great North Distributors for retail distribution of its product, acquired a 25.1% interest in a German hospital for EUR$1.2M, and formed a JV valued at $4.1M with a South African company. On June 6, the Company announced the construction of a $55M cannabis extraction centre, expected to process 200,000 kg, as well as a $225M bought deal at $11.85/share.

  • Market Cap: $ 2,419 Million
  • EV/Sales FY2019: 9.6x
  • EV/EBITDA FY2019: 28.8x
  • Cash $119 Million
  • Debt $108 Million
  • 1 Month Total Return: 13%
  • YTD Total Return: -41%

4. Cannex Capital Holdings Inc. (CSE:CNNX)- $ 0.88

Cannabis

Cannex Group Holdings Inc. is a Canada based company with operations in Washington and California. The Company is focused on premium indoor cultivation, extraction, manufacturing and branding of edible and derivative products, as well as retail operations. Its subsidiary, BrightLeaf Development LLC, is the largest producer/processor in Washington State. Cannex is also in the process of acquiring Jetty Extracts, one of the largest processors and extractors in California. The Company plans to produce from two indoor cultivating facilities with a combined 30,000 sq. ft. and 19,000 kg capacity, equating to one of the highest yields in the industry at 633 grams/sq. ft.

  • Market Cap: $ 78 Million
  • EV/Sales FY2019: 4.6x
  • EV/EBITDA FY2019: 6.0x
  • Cash Not Reported
  • Debt Not Reported
  • 1 Month Total Return: 13%
  • YTD Total Return: 147%

5. Liberty Health Sciences Inc. (CNSX:LHS)- $ 0.87

Cannabis

Liberty Health Sciences was launched to acquire and operate U.S.-based companies in the medical cannabis market. Liberty adds value to acquired companies through its expertise in commercial-scale greenhouses using low cost, seed-to-sale certified processes, as well as automation and processing methods. In May 2017, the Company entered an exclusive Management Agreement with Chestnut Hill Tree Farm LLC, a state-licensed Florida nursery, as a dispensing organization of medical cannabis to patients in the State of Florida. Chestnut holds one of eight licenses granted in Florida, which currently represents approximately 14% of U.S. medical cannabis. On May 11, the Company signed an agreement with Aphria (TSX:APH) to sell Solei Sungrown Cannabis in Florida and Massachesetts.

  • Market Cap: $ 287 Million
  • EV/Sales FY2019: N/A
  • EV/EBITDA FY2019: N/A
  • Cash $21 Million
  • Debt $1 Million
  • 1 Month Total Return: -15%
  • YTD Total Return: -57%

6. Sunniva Inc. (CNSX:SNN)- $ 6.23

Cannabis

Sunniva is a vertically-integrated medical cannabis company operating in in Canada and California. The Company aims to become the lowest cost, highest-quality cannabis producer in the markets by building large-scale purpose-built Current Good Manufacturing Practice (CGMP) greenhouses. Standards set by the CGMP offer better quality assurance with pesticide-free cannabis products to provide better patient and doctor access to cannabis education, and source better therapeutic delivery devices. SNN estimates it will complete its licensed 324,000 sq. ft. greenhouse production facility in Riverside County, California by Q3 2018. In Canada, it intends to have a 740,000 sq. ft. facility estimated to produce about 200,000 kg of cannabis annually. Importantly, Canopy will purchase roughly 45% of Sunniva’s annual production capacity. The Company received a Confirmation of Readiness for an ACMPR License on May 29. On July 10, the Company announced its listing on the Toronto Stock Exchange as well as the NASDAQ stock market.

  • Market Cap: $ 200 Million
  • EV/Sales FY2019: 1.0xx
  • EV/EBITDA FY2019: 5.7x
  • Cash $30 Million
  • Debt $34 Million
  • 1 Month Total Return: -21%
  • YTD Total Return: -31%

7. MPX Bioceutical Corp. (CNSX:MPX)- $ 0.81

Cannabis

MPX Bioceutical is a multinational diversified cannabis company in the medical and adult use cannabis markets. The Company plans to expand its influence in the U.S. through establishing 10 dispensaries and four production facilities in four states. The Company’s reputation is built on its profitable operations in Arizona, where it has two fully-operational Health for Life dispensaries and a third opening in Q2/2018. The Company has also recently acquired The Holistic Center, giving it a total of four dispensaries in Arizona. MPX is also constructing a 72,300 sq. ft. production facility in Canada, which has a pending ACMPR licence application. The Company expects to start cultivation in the second half of 2018, with a potential future expansion of 402,700 sq. ft. Collectively, MPX expects to have a production capacity of 9,000 kg of dried cannabis per annum and a capacity of 1,200 kg of concentrates.

  • Market Cap: $ 287 Million
  • EV/Sales FY2019: 2.4x
  • EV/EBITDA FY2019: 13.0x
  • Cash $32 Million
  • Debt $61 Million
  • 1 Month Total Return: -22%
  • YTD Total Return: -6%

8. Supreme Cannabis Company Inc. (TSXV:FIRE) – $ 1.50

Cannabis

Supreme Cannabis Company is a licensed producer and distributor of cannabis under the ACMPR, focused on cultivating premium dried sun-grown cannabis flowers on a commercial scale through its subsidiary, 7ACRES. Currently, 7ACRES operates 40,000 sq. ft. of operational capacity expected to have an average output of approximately 5,000 kilograms of dried cannabis per year. Once completed, the Company expects the facility will span more than 342,000 sq ft, producing 50,000 kg of premium dried cannabis per year at full capacity.

  • Market Cap: $ 384 Million
  • EV/Sales FY2019: 46.1x
  • EV/EBITDA FY2019: 42.8x
  • Cash $78 Million
  • Debt $43 Million
  • 1 Month Total Return: -13%
  • YTD Total Return: -34%

9. Green Organic Dutchman (TSX:TGOD) – $ 6.03

Cannabis

Green Organic Dutchman Holdings Ltd, is a Canada-based cannabis producer with operations in Ontario and Quebec. The Company’s facilities are under construction, but have already received ACMPR cultivation and sales licenses, in addition to receiving an oil extractions license in May 2018. TGOD aims to be the lowest cost producer in Canada by accessing the lowest power rates in Ontario and Quebec. The combined production capacity of the two facilities totaling 970,000 sq. ft. is expected to be 116,000 kg of cannabis flower. TGOD’s management team has ample experience in consumer packaged goods, which will likely be advantageous following legalization. The Company also has a large catalogue of licensing agreements for cannabis infused food and beverage products. Compared to its peers, TGOD has a large cash reserve which it is using for facility construction and its many R&D projects. The Company intends to complete a spin off, which is focused on acquisition and development of international opportunities. The TGOD shareholders will be paid dividend in form of warrants in the new corporation.

  • Market Cap: $ 1,384 Million
  • EV/Sales FY2019: 10.8x
  • EV/EBITDA FY2019: 37.6x
  • Cash $75 Million
  • Debt $0
  • 1 Month Total Return: -2%
  • YTD Total Return: N/A

10. Emblem Corp. (TSXV:EMC) – $ 1.23

Cannabis

Emblem is a fully-integrated licensed producer and distributor of medical cannabis and cannabis derivatives in Canada. The Company’s Ontario facility currently consists of a 23,500 sq. ft. production building to cultivate cannabis for medicinal use and has a planned expansion to 17,000 kg of annual production. The Company has designed and has commenced construction of a 30,000 sq. ft. expansion to the existing facility. The Company is currently producing at the rate of approximately 120-150 kg of dried cannabis per month. To improve this rate to 150-180 kg per month, Emblem intends to break ground on its newly-acquired lands in the second quarter of 2018. The new facility is expected to add ~120,000 sq. ft. of greenhouse space. On June 20, the Company announced a JV named Emblem Germany for the export of Emblem-branded products into the country.

  • Market Cap: $ 144 Million
  • EV/Sales FY2019: 3.0x
  • EV/EBITDA FY2019: 14.9x
  • Cash $84 Million
  • Debt $2 Million
  • 1 Month Total Return: -14%
  • YTD Total Return: -46%

Disclosure: Neither the author nor any of the principals at Small Cap Power, or their family members, own shares in any of the companies mentioned above.

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