Best way to invest in marijuana stocks?

[flyonwall]

I'm looking for advice on companies I should consider investing in that would benefit from marijuana being legalized. My feeling is that this trend will continue and that within the next 10 year it will be a multi-billion dollar business. The problem is that many of the marijuana stocks that are directly related to pot are too small and thinly traded for my comfort. I'm trying to come up with a list of stocks that are bigger and traded on Nasdaq or NYSE which would see a large benefit from the legalization of marijuana.

I think that cigarette companies would see a huge benefit. Marijuana might be seen as a competitor, but my guess is that they would get quickly get into the industry and already have the packaging and distribution channels in place.

I'm interested in thoughts of other companies that could greatly improve their bottom line is pot continues to be legalized.

[hamchan]

Fast food. Especially places that deliver.

[bjl584]

Who makes Doritos?

[flyonwall]

I assume that you're both joking, but do you think that snack foods will see an increase in sales due to this? Doritos and Taco Bell are both owned by PepsiCo.

I was thinking more along the lines of companies that would supply growers where this would open up a completely new business to them.

[rennigade]

I assume that you're both joking, but do you think that snack foods will see an increase in sales due to this? Doritos and Taco Bell are both owned by PepsiCo.

I was thinking more along the lines of companies that would supply growers where this would open up a completely new business to them.

According to Nancy Grace...yes. She seems to think everyone that smokes pot is lazy and overweight...while she could stand to lose a few pounds.

As for investing...who knows. Its such a new game, everyone wants to get in on the bottom floor. You're going to see a spike in the amount of "companies" popping up. After a couple years they'll thin out as the big boys chew them up and spit them out.

Invest in Monsanto...they'll soon have their grubby hands in the mix...everyone will be forced to use their gmo seeds.

[hamchan]

I don't know. Not really joking. I used to smoke on a regular basis when I was much younger and Pizza Hut made a killing off of me. So did the 7-11 I was able to walk to. Everything tastes amazing when you're stoned.

[disneysteve]

I have a bit of a moral problem with intentionally profiting from addiction although I'm sure some of my mutual funds own stock in the tobacco companies. By no means do I do socially conscious investing (or whatever it's called).

That said, in addition to the junk food angle, I wonder how the potential spread of legal drug abuse will affect things like auto insurance companies with more people driving under the influence. What about medical insurers as people suffer more drug-related health issues? Are there any publicly traded rehab centers? I guess divorce attorneys aren't publicly traded firms.

[KTP]

I used to have a moral problem but got it taken care of.

I am all ears for any new investment. Mary Jane is going to make some big money for someone. Think of the profits from Phillip Morris...they spun off companies you got stock in both and you still get fat dividends.

So please post if you find some sort of ETF or way to diversify into MJ.

[jIM_Ohio]

I would invest in stocks before you inhale, not after.

[jIM_Ohio]

I assume that you're both joking, but do you think that snack foods will see an increase in sales due to this? Doritos and Taco Bell are both owned by PepsiCo.

I was thinking more along the lines of companies that would supply growers where this would open up a completely new business to them.

If you were looking at "supply chain", focus on the suppliers to Taco Bell and Doritos (the farmers and downstream business) as opposed to retail. The average taco bell retail store owner is not who I would invest in, IMO.

And Taco bell is very regional- in Buffalo they have "mighty taco", and in Ohio only a few exist, yet in Michigan they are on every corner.

It would take years for marijuana growers to reach a point where a company went public, most of those are smaller growers now. Focus on regional members of the supply chain.

[PauletteGoddard]

Frito-Lay is the company of the Fritos and Doritos and Lays brands. Frito-Lay is a key business unit in PEPsico, which looks to have a bright five-year horizon according to analysis posts by Value Line and S&P Stock Reports.

The Seattle Police Department handed out bags of Doritos at Hempfest last May.

[JoeP]

On the flip side, it might be a good idea to start selling stocks or minimizing exposure to mutual funds linked with big pharma. There are certain medical conditions that are currently being treated with prescription drugs; this may change as people starting finding ways that MJ can help.

[disneysteve]

On the flip side, it might be a good idea to start selling stocks or minimizing exposure to mutual funds linked with big pharma. There are certain medical conditions that are currently being treated with prescription drugs; this may change as people starting finding ways that MJ can help.

I don't believe this will even be a speed bump for big pharma. At least in my experience, the patients who are going to use pot to self-medicate are already doing so, legal or not. I don't think there is going to be a big flood of patients abandoning Western medicine in order to smoke weed.

If you look at the top 10 selling drugs, there is only one, an MS drug, that might be impacted by widespread marijuana usage. If you look at the next 10, there's a couple of pain meds that could be somewhat impacted, so maybe 3 of the top 20 selling drugs serve patients that might possibly get some relief from marijuana. And that's assuming that all the folks addicted to Oxycontin (#15) are able to break their opiod dependence in exchange for marijuana dependence and that's pretty doubtful in my mind.

Cost will also be a big factor. Will patients be able to get a month's supply of marijuana for a $10 copay? Somehow I doubt that but time will tell.

Another thing to consider is that many of the top-selling drugs treat conditions that are directly impacted by obesity: diabetes, hypertension, arthritis, etc. If pot makes people eat more junk food, there will be even more obesity so we'll need those meds even more than we do now.

[jeffrey]

Just a warning for all those who might be interested...there are a lot of marijuana stocks that are penny/over the counter that have seen big swings lately -- and because they are traded so thinly, they are ripe for "pump and dump" schemes.

http://www.finra.org/investors/protectyourself/investoralerts/fraudsandscams/p325352

[hamchan]

I wouln't have a crisis of conscience over marijuana. It's no more addictive than porn, sex, or Twizzlers. Caffiene is harder to give up. I think the only thing that has been easier for me to quit is running. Running was pretty easy to quit. I wanted to participate in clinical trials, so I just stopped. Never felt the need or desire again. I know a lot of people who smoke weed and I know very few who I would consider even mildly addicted.