Rally On, Traders!
The “green revolution” is a lot more than a fad for investors lucky or foresighted enough to have accounts north of the border. I’m not trying to rub their glory in your face. If anything, it should get you hunting harder for opportunities to trade the theme down here in the USA.
Start in states like Nevada, where legal sales are BOOMING barely a year after recreational use opened up. You don't need to look farther than CLS Holdings (CLSH), which just announced that its Nevada sales in August are up 11% over last year.
And that's just retail. The wholesale brand? Up 400%! No wonder the chart points up:
That storyline looks a lot like the Canadian giants, powerful enough to give shareholders a 3-digit ride on a moment’s notice. After all, Big Beer is betting Big BILLIONS on legal green so it’s no wonder these stocks are in play.
But there’s two key differences here. One, Canada already voted for 100% legal. Down in the U.S., it’s still state by state and enforcement depends on the mood in the DOJ. That gives stocks like CLSH more room to grow as the news flow goes their way.
After all, CLSH is ramping about as fast as it gets. Nevada already does $340 million retail, purely on the recreational side. That’s coming from ZERO and it’s double what the experts expected early on.
CLSH bought into Las Vegas retail a few months back via a company called Oasis, which currently does $850,000 a month in sales last I checked. That gives CLSH, what, a 2% share of the fragmented Nevada opportunity? Plenty of room to grow.
And that's what CLSH is doing. They raised $5.75 million USD and another $13 million Canadian to expand. As the CEO put it recently, they need to TRIPLE production just to meet existing demand.
They've got extracts and other value-added products in 20 dispensaries now. With deep distributor relationships, they can go aggressively after the other 45 I'm seeing in the state.
Canada is a little more “mature.” Those companies have had time to build out their businesses, cash to spend and are already earning a profit. That’s a long way from start-up land, much less the real wild west where firecracker fortunes are made.
After all, US green has had a harder history. These stocks reflect years of back-and-forth from an attorney general who obviously hates them. He’s gone back on enforcement amnesty. He’s tightened back down on financing restrictions.
But hey, rumor has it he won’t be around after November. Tick tock! If we can get clarity down here, suddenly the US green stocks like CLSH have a Canada-like tailwind to ride . . . all the pressure goes away!
And hey, I love Canada but the economy down here is 10X as big and so is the population. Whatever success shareholders have seen up there may look like NOTHING once our green stocks are finally unleashed.
Will it take a new attorney general to make that happen? All I know is that I hate to miss a once-in-a-lifetime rally. And if we get that here, CLSH is already itching to break out of its current box and lead the way.
Happy, Happy, Happy Trading!
