2 marijuana stocks to watch as New York legalizes recreational pot
So It’s a deal done: After months, if not years, of promise and hope, New York legalized recreational marijuana (it did so with medical pot in 2014). Three renowned cannabis companies are already operating in the Empire State – Curaleaf Fund (OTC: CURLF), Cresco Laboratories (OTC: CRLBF), and Columbia Care (OTC: CCHWF). Of the trio, two are definitely worth watching as New York City flips the adult switch.
In this segment of Motley Fool Live Recorded on May 21, veteran Fool contributor Eric Volkman focuses on the two in a chat with Corinne Cardina, head of the healthcare and cannabis bureau.
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Corinne Cardina: So, are there any jar stocks that already have a footprint in New York’s medical program, that might have a first-come advantage?
Eric Volkman: Yeah, there are several. There are a few candidates.
Basically we are looking at three companies. You have Curaleaf Holdings, which is a multi-state operator (MSO) that, as the term suggests, is active in a bunch of states; basically it’s America’s biggest MSO. Cresco Labs, which is an ambitious company from Illinois, and then we have Columbia Care, which I think of as kind of a dark horse. However, they have to be part of the mix, as they’re actually New York-based, unlike the other two. Curaleaf is based in Massachusetts.
Curaleaf and Cresco have four dispensaries each. As you say, because at the time or before this legalization, New York was a purely medical marijuana market. Even now, these dispensaries only sell medical products – you cannot buy recreational products there. The first two companies I mentioned, Curaleaf and Cresco, are ahead of the game because of this.
Of the two, if we’re just talking about pure New York presence right now, the benefit has to go to Curaleaf because they have a grow facility. They have a place from which they can natively provide their [New York] dispensaries. But a lot can change, and especially waiting a year for the change to be reversed in the pot market, other companies can step in and I’m sure they will.
Like, for example, Cresco. They have a pretty hot rivalry with another vertically integrated weed company in Illinois called Green thumb industries. They could also take a hungry eye over New York. Right now, however, if you’re thinking of taking a business with a head start, Curaleaf and Cresco are probably the two to watch out for.
Columbia Care I don’t think so much even though they have four dispensaries in the state like the other two companies. To me, they seem more interested in the states outside of New York. Recently, they signed a $ 240 million deal for a company called Green Leaf Medical. [So] they’re like a Mid-Atlantic business. They are active in Ohio, Virginia, Pennsylvania and Maryland.
I think their goal is elsewhere. I mean, I haven’t heard too much from the company commenting on its ambitions, but it looks like it might be giving up the New York market.
So at the end of the day Curaleaf and Cresco are probably the two at this early stage that I would keep an eye on.
Corinne Cardina has no position in any of the listed securities. Eric Volkman has no position in any of the listed securities. The Motley Fool owns shares and recommends Cresco Labs Inc. and Green Thumb Industries. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.