Marijuana Stocks on the ASX: A Guide

For most people, it was probably just another Thursday. They probably got up, dragged themselves to work, came home and thought nothing of it.

How naïve they were.

The ignorant amongst us, including yours truly at the time, didn’t appreciate that history was being made. In fact, the vast majority didn’t even have a clue what was happening.

But for those lucky few that were there, it will be a day that they remember for years to come. It was the day that cannabis made its debut on the ASX.

And what a debut it was…

Phytotech Medical was the bell of the ball. Officially listing at 20 cents per share, speculators were chomping at the bit to get their hands on the first Australian pot play.

In just its second day of trading, the stock peaked at an intra-day high of 92 cents!  A 360% gain in less than 48 hours.

It set the tone for what would become one of the hottest markets in recent history. And today, you can still see echoes of that same explosiveness.

The difference is, now there is more than just one company. There is an entire sector filled with companies hoping to turn pot into massive profits.

As an investor, it presents a once in a lifetime opportunity. A chance to be a part of a revolution that is set to change the world forever. Oh and of course, there could be a lot of money up for grabs along the way.

The only question is: where do you put your money? Let’s take a look shall we…

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The List

First up, a disclaimer. This article ISN’T a list of stocks we recommend buying.

Instead, think of it as a quick-start guide. A chance to learn and inform yourself about the potential investment options open to you.

Here is the list of just some of the pot stocks you will find on the ASX:

Algae.tec Ltd [ASX:AEB] Lifespot Health Ltd [ASX:LSH]
AusCann Group Holdings Ltd [ASX:AC8] Medlab Clinical Ltd [ASX:MDC]
BOD Australia Ltd [ASX:BDA] MGC Pharmaceuticals Ltd [ASX:MXC]
Botanix Pharmaceuticals Ltd [ASX:BOT] MMJ Phytotech Ltd [ASX:MMJ]
Cann Group Ltd [ASX:CAN] Queensland Bauxite Ltd [ASX:QBL]
Cannpal Animal Therapeutics Ltd [ASX:CP1] Rhinomed Ltd [ASX:RNO]
Chapmans Ltd [ASX:CHP] Roto-Gro International Ltd [ASX:RGI]
Creso Pharma Ltd [ASX:CPH] Stemcell United Ltd [ASX:SCU]
Elixinol Global Ltd [ASX:EXL] Hydroponics Company Ltd [ASX:THC]
eSense-lab Ltd [ASX:ESE] TPI Enterprises Ltd [ASX:TPE]
Eve Investments Ltd [ASX:EVE] Zelda Therapeutics Ltd [ASX:ZLD]

 

Keep in mind this list isn’t definitive, either. This is a turbulent industry with companies dropping in and out fairly regularly.

At the very least though, it should give you a good place to start. From here you can start delving deeper into the world of pot stocks in Australia.

Be careful though!

It’s one hell of a deep rabbit hole, and you might find it hard to turn back once you start delving deeper.

However, if you’re willing to learn and put in the work, it can be very rewarding.

Most important of all though, is to remember that no two stocks are alike.

Every single one of the companies listed above, is offering something unique. Sometimes they may seem similar at face-value, but dig a little deeper and you’ll find the critical nuances.

Here are just three of the main markets you can find cannabis in right now:

In Good Health

As you may have noticed, a lot of the companies on the list have one thing in common: health. It’s all in the names really, with titles like ‘pharma’ and ‘therapeutics’.

Straight away that should tip you off about the sort of company you’re dealing with. These companies read and operate like biotechs — it just so happens that their drug of choice is cannabis.

And their goal is to show Australia and the world the power of medical marijuana.

Take Medlab Clinical Ltd [ASX:MDC], for example. The company is working on a high-strength cannabis painkiller for cancer patients. A product that, if successful, could replace the need for opioid-based painkillers.

Medlab’s product is called NanaBis, an oral spray that delivers a targeted dose of cannabis with ease and precision.

This is a product that has been developed and perfected in the lab. It will face clinical trials and testing just like any other drug. 

They’re just one of the many companies hoping to profit from cannabis’ miracle properties. Stocks that are knee-deep in research and trials.

These are the companies that are poised to usher in a new frontier of medicine. One that has been kept under lock and key for far too long.

Eat Your Greens

Not everything is about medicine though, when it comes to pot stocks. You may have heard that some people actually like to consume cannabis…for fun.

In Australia, this is obviously still a criminal offence. But that hasn’t stopped some companies from looking for ways to sell some ‘green’ food.

Top of this consumer-based list is EVE Investments Ltd [ASX:EVE] and Elixinol Global Ltd [ASX:EXL].

Both of these companies have one thing in common, and no, it’s not cannabis. Instead, both Eve and Elixinol are actively marketing and selling hemp-based food.

Hemp is a plant that is very similar to cannabis. In fact, the two are often confused. But the difference is that hemp won’t get you high. It does contain the same active chemicals, but there’s so little that you’ll never feel a thing.

However, while it won’t get you high, hemp is packed with a lot of other great proteins, fats and vitamins. And both Eve and Elixinol are hoping people are also going to love the taste.

It may sound strange, but hemp and cannabis infused food and drinks are really picking up steam. And companies are betting big on people going ga-ga for a taste of the green stuff.

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Green Thumbs

At the end of the day, someone has to actually grow this stuff. Whether people want it for pain relief, eating, drinking, smoking or whatever else — someone has to produce some plant material.

Luckily, we’re pretty good at growing plants in Australia. And cannabis will be no different.

This is without a doubt the biggest market for pot stocks right now. We simply need to produce enough product for ourselves and eventually the world.

On our list, you’ll find a lot of companies that are getting into the cultivating business. It’s an obvious choice for most companies that plan to work with cannabis.

However, there are also a few stocks that could profit handily from this influx of new growers.

For instance, Roto-Gro International Ltd [ASX:RGI] doesn’t actually sell or buy cannabis, at all. Instead, they sell a unique rotary hydroponic system designed specifically for growing the plant itself.

The idea is to give cultivators and farmers a tool that lets them grow pot more effectively. A niche little way of profiting from the cannabis boom without having to dance around law.

Roto-Gro aren’t the only company like this, either. You can find plenty of companies that could fit somewhere in the cannabis supply chain.

And just like any other industry, when demand is booming, everyone along the supply chain benefits.

This is just a small glimpse at what you can find on the ASX, however. If you’re serious about investing in this sector, then start researching yourself. You’ll be surprised at what you uncover.

Remember, this isn’t a list of recommendations. It’s simply a rundown of most of the cannabis-related stocks you’ll find on the ASX.

If you’re serious about investing in pot stocks then take the time to look through each company carefully and do your own research. A smart investor is an informed investor.

It’s a volatile industry, but there could be a lot of potential for some serious gains.

This is your chance to be a part of history this time around. A chance to be involved in something bigger than all of us.

Don’t let it be just another ordinary day.

Regards,

Ryan Clarkson-Ledward,
For, Markets and Money


Ryan Clarkson-Ledward is a junior analyst for Markets & Money. Ryan has degrees in both communication and international business. His priority is bringing you the latest price updates on stocks through ASX updates, as well as supporting Sam Volkering with background research. As part of the team at Markets & Money his aim is to provide unbiased and relevant news for readers. Ryan’s work with Sam is designed to provide research that complements Sam’s analysis for small-cap and technology stocks. Together, their objective is to break through all the jargon and give you the hard facts to inform your investment decision-making. Ryan writes for:


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