I think it’s time for a little recap on what is going on in the cannabis industry --- to be succinct, there is a sizable long-term growth rate in store for the industry.
Analysts at Cowen say the U.S. cannabis market could rocket to $16 billion by 2025.
Arcview Market Research and BDS Analytics say the worldwide market could explode to $57 billion by 2027. In the U.S. alone, North American cannabis sales could reach $47.3 billion just over the next decade.
Globally, Piper Jaffray believes the market for legal cannabis could be worth $15 billion to $50 billion a year, with global sales growing to $250 billion to $500 billion. All this growth is thanks to a growing acceptance and legalization in countries around the world.
As that growth just begins to unfold, we’re likely to see a rash of Mergers & Acquisitions.
For example, Cresco Labs Inc. just bet big on the California cannabis market with an $825 million acquisition of Origin House. The deal will create a premiere distribution company that will serve the largest cannabis market in the world.
I could easily list more but the point is clear, the cannabis industry is in a state of flux and the permutations and commutations are nearly infinite. It may take years for the entire industry to finally settle out, and companies will merge and then sell and then merge and then sell again until only a few large companies finally remain. The companies we own today may not be the same companies we end up owning in the future.
Much like the dot.com days, small companies will become big companies and industry leaders today will shrink and fad away. During the dot.com days, patient investors held firm on their start-ups and in time they ended up owning the titans of the industry.
Investment advisors often tell folks they should study the company managers and invest based on their track record alone. This sounds like prudent advice, and our managers (Dalton, Crockett, Goldman, and Mitchell) are basically as good as they get. The waiting is tiresome, but the reward for this type of investment certainly could be stellar. Hang in there folks, the wait is nearly over.
Kgem
Analysts at Cowen say the U.S. cannabis market could rocket to $16 billion by 2025.
Arcview Market Research and BDS Analytics say the worldwide market could explode to $57 billion by 2027. In the U.S. alone, North American cannabis sales could reach $47.3 billion just over the next decade.
Globally, Piper Jaffray believes the market for legal cannabis could be worth $15 billion to $50 billion a year, with global sales growing to $250 billion to $500 billion. All this growth is thanks to a growing acceptance and legalization in countries around the world.
As that growth just begins to unfold, we’re likely to see a rash of Mergers & Acquisitions.
For example, Cresco Labs Inc. just bet big on the California cannabis market with an $825 million acquisition of Origin House. The deal will create a premiere distribution company that will serve the largest cannabis market in the world.
I could easily list more but the point is clear, the cannabis industry is in a state of flux and the permutations and commutations are nearly infinite. It may take years for the entire industry to finally settle out, and companies will merge and then sell and then merge and then sell again until only a few large companies finally remain. The companies we own today may not be the same companies we end up owning in the future.
Much like the dot.com days, small companies will become big companies and industry leaders today will shrink and fad away. During the dot.com days, patient investors held firm on their start-ups and in time they ended up owning the titans of the industry.
Investment advisors often tell folks they should study the company managers and invest based on their track record alone. This sounds like prudent advice, and our managers (Dalton, Crockett, Goldman, and Mitchell) are basically as good as they get. The waiting is tiresome, but the reward for this type of investment certainly could be stellar. Hang in there folks, the wait is nearly over.
Kgem
4
