Better Marijuana Stock: OrganiGram vs. Green Thumb Industries
The coronavirus pandemic has been great for pot stocks -- well, for most of them. Stay-at-home orders and business shutdowns have highlighted marijuana's evolution into a staple consumer good. It's been able to draw consistent and highly regular demand throughout the pandemic. The uptick is partly because of its medicinal benefits: Research has shown that marijuana can help treat anxiety, which has had an outsized effect on women, young adults aged 18 to 24, and those staying at home with young children, according to new research published by The Lancet.
Some U.S. cannabis companies have seen their revenue growth triple this year, even within a limited legal market. In the U.S., cannabis is still illegal at the federal level. Nevertheless, Massachusetts-based Curaleaf Holdings (OTC: CURLF) saw revenue jump 142% year over year to $117.5 million in its recent second quarter ended June 30. Meanwhile, Illinois-based Cresco Labs (OTC: CRLBF) also saw second quarter revenues up 216% to $94.2 million compared to the year-ago period. However, their Canadian counterparts' revenue growth has remained modest, despite high consumer demand. The Canadian industry has struggled in part because fewer legal stores have opened in 2020 as a result of regulatory hold-ups. Adding to the strain is the still-thriving black market, which offers a variety of cannabis products, often at cheaper prices.
Illinois-based Green Thumb Industries (OTC: GTBIF) is another one of the lucky U.S. pot stocks. It's growing its revenues and has enjoyed consistent positive EBITDA (earnings before income, tax, depreciation, and amortization), but has also kept its balance sheet fit enough to fuel expansion. Meanwhile, Canada-based OrganiGram (NASDAQ: OGI) hasn't reported sufficient revenue to generate profits, and its recent quarterly results were worrisome. Let's take a deeper dive into each of these stocks in order to determine which provides the most long-term investment benefits.
Source Fool.com