This Marijuana Stock May Already Be Running Out of Chances to Succeed
In case you haven't noticed, the marijuana industry is growing by leaps and bounds. According to cannabis research firm ArcView, the legal weed industry in North America is estimated to grow by 26% on an annual basis through the year 2021 , leading to a market worth nearly $22 billion. It's not often that an industry comes along that can sustain a 26% annual growth rate for five years, or longer, which is why investors have latched onto marijuana stocks – and they haven't disappointed. Many of the largest marijuana stocks have jumped by 100% or more over the trailing year.
But not everything is "green" when it comes to marijuana. The U.S. federal government continues to categorize the substance as schedule I, meaning it has no recognized medical benefits, and is therefore entirely illegal. This categorization makes it very difficult for pot-based businesses to receive basic financial services, such as a checking account, from banks. It also leads to tax disadvantages, with marijuana companies unable to take normal corporate income-tax deductions.
Those disadvantages aside, some marijuana companies are mired in steep losses by their own doing. Clinical-stage cannabinoid drug developer Zynerba Pharmaceuticals (NASDAQ: ZYNE) is a prime example.
Source: Fool.com
