Cannabis Industry Outlook: International Legalization Grows
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Cannabis Industry Outlook: International Legalization Grows


let’s turn our attention to this week’s
industry spotlight on cannabis now there’s heightened investor interest
around this emerging trend so with me to make sense of it all is Andrew Kessner
he’s the cannabis and industrials analyst at William O’Neil & Company
which is an affiliate of IBD thanks so much for being here today Andrew great
to be here listen alright so we know there’s somewhat of this frenzied
interest surrounding the cannabis industry right now why do you think
investors want to be paying attention to this and from a profitability standpoint
in their portfolios what’s it going to take in this industry to get us there
well from a very high level it’s a tremendous existing market that’s just
starting to move to regulated channels so in the US the market is estimated to
be over fifty billion dollars annually most of that is black market about 80%
in Canada which just turned to recreational to allow recreational
marijuana the markets estimated to be be about six billion dollars and then it’s
more difficult to estimate the international market but it’s estimated
to be at over a hundred billion dollars and that’s primarily illicit sales so as
we see more and more countries legalize medical marijuana and in some countries
like Canada rec for recreational use we’re just seeing the opportunity really
broaden and over the past few years we’ve seen a lot of companies pop up
many of which are now publicly traded and available for investors to to
participate in this opportunity most of these companies are in Canada there are
some in the US that are more thinly traded but as you look at the larger
companies in Canada right now you know a year or two ago most of these companies
were just a business plan with some founders who were very good at at
selling the idea and raising money now we’re getting to the point where the
Canadian recreational market started last October we’re starting to see sales
really pick up there we’re starting to see these companies really expand into
international markets and so you know when investors were looking at these
companies a year or two ago and they were really just looking at pitch books
now they’re looking at revenues and they’re looking at market share
and we really want to drill down in these companies more and and pick
companies where we think that management team is one that can lead the company to
do what they said they would do and really look for operational excellence
and execution and you know all the things that you would look for for sort
of a more standard more mature company rather than a startup

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