Both Canopy Growth (NYSE:CGC) and Green Thumb Industries (OTC:GTBIF) were up more than 90% earlier this year. But both marijuana stocks gave up most of those gains, with Canopy’s shares even falling into negative territory year to date.
Which of these two stocks is the better pick for long-term investors now? Here’s how Canopy Growth and Green Thumb Industries stack up against each other…
The case for Canopy Growth
Canopy Growth has taken a lot of flak for missing revenue expectations in its fiscal 2020 first-quarter results. The company also isn’t nearly as far along as investors would like toward achieving profitability. But don’t let these issues obscure several big advantages for Canopy.
The main focus right now is on Canada, where Canopy continues to rank as a leader in the country’s adult-use recreational cannabis and medical cannabis markets. A new phase of the adult-use market is just around the corner with the coming launch of the Cannabis 2.0 cannabis derivatives market.
Canopy Growth should be a top player in this expanded market as well, maybe even the top player. It’s on track to introduce a line of cannabis-infused beverages developed with partner Constellation Brands (NYSE:STZ). Canopy plans to roll out multiple cannabis edibles, including chocolates. The company has also worked to develop its own distinctive vape products.
However, international markets are where Canopy hopes to make even bigger money. The company has operations in Europe, South America, Australia, and Lesotho, including owning Europe’s largest cannabinoid drugmaker.
Canopy is arguably in the best position of any Canadian cannabis producer for the huge U.S. market. The company claims a large-scale hemp production facility in New York state and plans to launch hemp CBD products later this year. Canopy also has a deal in place to acquire U.S.-based cannabis operator Acreage Holdings when U.S. federal laws permit.
Thanks to a $4 billion investment from Constellation Brands, Canopy Growth has the largest cash stockpile in the cannabis industry. Although the company will burn through some of that cash funding operations until it becomes profitable, Canopy is in good shape to be able to take advantage of opportunities to fuel more growth.
The case for Green Thumb Industries
While Canopy Growth hopes to score big in the U.S. cannabis market, Green Thumb Industries (GTI) is already doing so. The company distributes several of its own cannabis brands in the U.S. and operates two national retail cannabis chains, Rise and Essence.
GTI currently has retail cannabis stores in…
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