Canadian Cannabis Industry In May 2021

Are marijuana stocks setting up for a rebound in the market? Last week top cannabis stocks closed on Friday, May 14th showing upward momentum in trading. For more than two months the cannabis sector has been losing market value and trading near price points at the end of 2020. But May could be giving way to a market recovery for the cannabis sector.

For new investors, this could be a good time to look for pot stocks to watch for gains in 2021. One area that has been hit particularly hard over the past few months is Canadian cannabis stocks. Although recent earnings for most Canadian cannabis companies have missed expectations. The current market value for most of the Canadian cannabis sector could produce significant upside for investors.

So far this year top Canadian cannabis stocks have seen the most gains in 2021. This is partly due to the belief that the US could implement federal cannabis reform sometime this year. But as the year progressed investors have turned to the better performing US cannabis companies. But there could be a shift on Capitol Hill towards cannabis reform in the next few months.

How US Cannabis Reform Could Change Canadian Companies

In essence, this would be a catalyst for Canadian cannabis companies once they achieve entry into the US market. Another area Canadian cannabis companies are seeing substantial growth in their exports of medical marijuana globally. With more countries across the world changing their policies on cannabis in the next few years, this area of the market could grow rapidly.

There are some well-positioned cannabis companies that could be beneficial for your portfolio in the next few months. In general, these companies have a large presence in the Canadian market and have also established entry into the US market in some form or another. At current market values, these Canadian marijuana stocks could produce some returns for investors. With all this in mind let's take a look at 3 top Canadian marijuana stocks to watch in May.

Marijuana Stocks To Watch:

1. Canopy Growth Corporation (NASDAQ: CGC)
2. Tilray, Inc. (NASDAQ: TLRY)
3. Sundial Growers Inc. (NASDAQ: SNDL)

Canopy Growth Corporation

Recently many Canadian cannabis companies have been establishing entry into the US market. But Canopy growth could have several ways to capitalize off the US cannabis industry once it’s fully legal. For quite some time Canopy has established a partnership and possible acquisition with Acreage Holdings, Inc. (OTC: ACRHF). In addition, Canopy has also signed a US distribution agreement with Southern Glazers Wine & Spirits for a CBD beverage portfolio. Specifically, this partnership will coincide with the launch of the company's new Quatreau CBD-infused beverages. In another recent acquisition, Canopy has also strengthened its brand portfolio with one of Canada's premium cannabis brands The Supreme Cannabis Company, Inc. (OTC: SPRWF).

CGC stock closed on May 14th at $22.91 up 3.57% for the day. With a high in February of $56.50, the stock is now down 7.02% year to date. In the past 30 days, CGC stock has lost 17.56% in market value. But investors should note that CGC stock has increased 1029.46% in its five-year performance. According to analysts at CNN Business CGC stock has a 12-month median price target of $30.93 per share. In essence, this would be a 34.83% increase from current levels. Currently CGC stock could have potential returns for the short-term and long-term investor. For this reason, CGC stock could be one of the best Canadian cannabis stocks to watch in May.

Tilray, Inc.

With one of the largest mergers in the Canadian cannabis market, Tilray, Inc. and Aphria Inc. can possibly become the industry-leading cannabis revenue producer. Flying under the Tilray banner with leadership from Aphria's management, Tilray has a 2020 full fiscal year revenue of $210.5 million. Worldwide the company has established a global presence with its brand in 1319 stores. In 2021 Tilray has also become one of the first cannabis companies to gain approval to ship medical cannabis products to Spain. Tilray now has many ways of capitalizing on its entry into the US market. For one Aphria Inc. announced in 2020 the acquisition of SW Brewing Company an independent US craft brewer that is already launching CBD infused beverages.

TLRY stock is up 68.64% year to date with a high of $67.00 in February On May 14th the stock closed at $13.93 and is down 19.94% in the last 30 days. According to analysts at Tip Ranks TLRY stock has a 12-month average price target of $22.14 this would represent an increase of 58.94% from current levels. With its recent drop in value in the last month, TLRY may see some upside in the coming trading weeks. Making TLRY stock a top Canadian marijuana stock for your watchlist next week.

Sundial Growers Inc.

On May 11th Sundial was among the few Canadian cannabis companies that surprisingly beat with first quarter 2021 earnings from operations of $1.7 million compared to a loss of $32.7 million the prior quarter. In addition, the company also achieved a first-quarter adjusted EBITDA of $3.3 million the first in the company's history. In general, Sundial is adjusting to the current climate in the Canadian cannabis market. With $969.5 million in unrestricted cash, marketable securities, and long-term investments the company could continue to expand in the market.

SNDL stock closed on May 14th at $0.7066 up 2.41% for the day. In February SNDL stock reached a new high of $3.96 and is currently up 49.23% year to date. According to Market Beat SNDL stock has a consensus price target of $0.73 per share. This would only be a 3.8% increase from current levels. But with the increasing possibility, the US could begin the cannabis reform process SNDL stock is a top Canadian marijuana stock to watch right now.