Borderland Beat
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THE GREEN RUSH
And according to an investor fact sheet or Medical Marijuana Inc. (MJNA +10.87%), the current U.S. medical marijuana industry is estimated at $17 billion, with expectations it could grow up to about $29 billion by 2016.
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The New Dot.Com
Up 442% : On Tuesday I posted on forum this article from Wall Street Journal. Stocks we as low at .75 to 1 dollar. Yesterday they were at 44 dollars. Today I hear they are over 215 (MEDBOX). They will adjust after this initial frenzy, however there will be new entries into the market as the law gains ground and spreads to other states more small successful medical MJ companies will go public.
On November 5th , Marijuana Inc was awarded world exclusive marketing rights in preparation for the onslaught. One of the more interesting companies that I was clueless of its existence is MJ vending machines, for medical MJ, it operates but an thumb print ID scan on the machine. amazing two articles below....Paz, Chivis
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| Thank you "Richard" for this personal photo |
Mark Twain is said to have remarked that a gold rush is a good time to be in the pick and shovel business. Investors may be able to apply that same bit of wisdom to the growing number of U.S. states that have legalized pot.
Although federal law prohibits the sale or possession of marijuana, Massachusetts last week joined the ranks of states — 18 plus Washington, D.C. — that allow its use for people suffering from chronic illnesses like cancer, HIV/AIDS, multiple sclerosis and epilepsy.
In Washington and Colorado, meanwhile, voters passed an initiative to allow pot for recreational use. Those changes have kickstarted a small but fast-growing medical-marijuana industry, estimated to be worth about $1.7 billion as of 2011, according to See Change Strategy, an independent financial-analysis firm that specializes in new markets.
In Colorado alone, sales topped $181 million in 2010, and the business employed 4,200 state-licensed workers, says Aaron Smith, executive director of the National Cannabis Industry Association , a nonprofit trade group that campaigns for marijuana’s federal legalization.
In addition to profiting itself from growing and selling marijuana, the industry benefits a slew of other businesses, such as insurers, lawyers and agricultural-equipment firms, experts say.
“Call it the ‘green rush,’” says Derek Peterson, CEO of GrowOp Technology, an online retailer of hydroponics — products used in the cultivation of indoor plants — and a subsidiary of OTC stock Terra Tech /quotes/zigman/8701126/quotes/nls/trtc TRTC 0.00% . “The industry is expanding, and there are all kinds of investment opportunities.”
For regular investors looking to get in on the action — and without having to actually grow or sell drugs — there are several small-cap stocks that stand to gain from marijuana’s growing acceptance. Medbox /quotes/zigman/7157004/quotes/nls/mdbx MDBX +80.00% , an OTC stock with a $45 million market cap, for example, sells its patented dispensing machines to licensed medical-marijuana dispensaries.
The machines, which dispense set doses of the drug, after verifying patients’ identities via fingerprint, could potentially be used in ordinary drugstores too, says Medbox founder Vincent Mehdizadeh. Based in Hollywood, Calif., the company already has 130 machines in the field, and it expects to install an additional 40 in the next quarter. “The smart money is trying to help with compliance and transparency,” Mehdizadeh says.
Of course, investing in drugs the federal government still outlaws poses enormous risks to investors, says Sam Kamin, a law professor and the director of the Constitutional Rights & Remedies Program at the University of Denver.
In fact, nearly 500 of the estimated 3,000 dispensaries nationwide have either been closed by the federal government or shut down in the past year, says a spokesman for StickyGuide.com , an online directory and review site for medical marijuana dispensaries — and yet another ancillary business that’s currently seeking investors.
That said, there are many companies that appear to be betting on a change in federal law.
Steep Hill is a quality-control laboratory that tests medical marijuana to see if there’s any contamination from mold, bacteria or harmful pesticides. The company, based in Oakland, Calif., is also actively seeking funding of up to $3 million. David Lampach, co-founder and president of Steep Hill, expects a federal law legalizing medical marijuana within the next decade.
Although federal law prohibits the sale or possession of marijuana, Massachusetts last week joined the ranks of states — 18 plus Washington, D.C. — that allow its use for people suffering from chronic illnesses like cancer, HIV/AIDS, multiple sclerosis and epilepsy.
In Washington and Colorado, meanwhile, voters passed an initiative to allow pot for recreational use. Those changes have kickstarted a small but fast-growing medical-marijuana industry, estimated to be worth about $1.7 billion as of 2011, according to See Change Strategy, an independent financial-analysis firm that specializes in new markets.
In Colorado alone, sales topped $181 million in 2010, and the business employed 4,200 state-licensed workers, says Aaron Smith, executive director of the National Cannabis Industry Association , a nonprofit trade group that campaigns for marijuana’s federal legalization.
In addition to profiting itself from growing and selling marijuana, the industry benefits a slew of other businesses, such as insurers, lawyers and agricultural-equipment firms, experts say.
“Call it the ‘green rush,’” says Derek Peterson, CEO of GrowOp Technology, an online retailer of hydroponics — products used in the cultivation of indoor plants — and a subsidiary of OTC stock Terra Tech /quotes/zigman/8701126/quotes/nls/trtc TRTC 0.00% . “The industry is expanding, and there are all kinds of investment opportunities.”
For regular investors looking to get in on the action — and without having to actually grow or sell drugs — there are several small-cap stocks that stand to gain from marijuana’s growing acceptance. Medbox /quotes/zigman/7157004/quotes/nls/mdbx MDBX +80.00% , an OTC stock with a $45 million market cap, for example, sells its patented dispensing machines to licensed medical-marijuana dispensaries.
The machines, which dispense set doses of the drug, after verifying patients’ identities via fingerprint, could potentially be used in ordinary drugstores too, says Medbox founder Vincent Mehdizadeh. Based in Hollywood, Calif., the company already has 130 machines in the field, and it expects to install an additional 40 in the next quarter. “The smart money is trying to help with compliance and transparency,” Mehdizadeh says.
Of course, investing in drugs the federal government still outlaws poses enormous risks to investors, says Sam Kamin, a law professor and the director of the Constitutional Rights & Remedies Program at the University of Denver.
In fact, nearly 500 of the estimated 3,000 dispensaries nationwide have either been closed by the federal government or shut down in the past year, says a spokesman for StickyGuide.com , an online directory and review site for medical marijuana dispensaries — and yet another ancillary business that’s currently seeking investors.
That said, there are many companies that appear to be betting on a change in federal law.
Steep Hill is a quality-control laboratory that tests medical marijuana to see if there’s any contamination from mold, bacteria or harmful pesticides. The company, based in Oakland, Calif., is also actively seeking funding of up to $3 million. David Lampach, co-founder and president of Steep Hill, expects a federal law legalizing medical marijuana within the next decade.
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Cannabis Science in Colorado Springs, Colo. /quotes/zigman/11136879/quotes/nls/cbis CBIS +22.06% , an OTC stock with a market cap of $41 million, is developing marijuana-based medicines to help cancer and HIV/AIDS patients. “We’re at the beginning of the revolution in medicine,” says CEO Robert Melamede.
Other companies are creating a range of quirky products that allow people to use marijuana without smoking it. Medical Marijuana /quotes/zigman/548382/quotes/nls/mjna MJNA -7.98% an OTC stock with a $69 million market cap, based in San Diego, Calif., offers more than 50 ways to ingest marijuana , from Dixie Elixir soda to Dixie Chill ice-cream and a range of Dixie Edibles, like chocolate truffles and crispy rice treats.
While experts say competition in the medical-marijuana business is growing fast, they add that there are also still plenty of opportunities for entrepreneurs. For example, Troy Dayton, president and CEO of ArcView Group , an angel investor network for the industry, says demand has been growing for handheld tobacco vaporizers like those made by Ploom (which charges $250 for its “premium loose-leaf vaporizer”). “There’s a rush now to make the ideal vaporizer,” Dayton says. “There’s still room for a kingmaker in this space.”
In the meantime, at least one drug company is directly selling medical marijuana to patients around the world. GW Pharmaceuticals /quotes/zigman/286334/quotes/nls/gwprf GWPRF +3.36% , based in London, markets Sativex, billed as the world’s first marijuana-based medicine.
With a market cap of around $137 million, it’s listed on the Alternative Investment Market, a submarket of the London Stock Exchange. Sativex is currently sold as a mouth spray to help alleviate symptoms of multiple sclerosis in several countries, including the U.K., New Zealand, Germany, Spain, Denmark and Canada, a spokesman says, and it is currently seeking FDA approval in the U.S. for use as a pain reliever in late-stage cancer patients
Other companies are creating a range of quirky products that allow people to use marijuana without smoking it. Medical Marijuana /quotes/zigman/548382/quotes/nls/mjna MJNA -7.98% an OTC stock with a $69 million market cap, based in San Diego, Calif., offers more than 50 ways to ingest marijuana , from Dixie Elixir soda to Dixie Chill ice-cream and a range of Dixie Edibles, like chocolate truffles and crispy rice treats.
While experts say competition in the medical-marijuana business is growing fast, they add that there are also still plenty of opportunities for entrepreneurs. For example, Troy Dayton, president and CEO of ArcView Group , an angel investor network for the industry, says demand has been growing for handheld tobacco vaporizers like those made by Ploom (which charges $250 for its “premium loose-leaf vaporizer”). “There’s a rush now to make the ideal vaporizer,” Dayton says. “There’s still room for a kingmaker in this space.”
In the meantime, at least one drug company is directly selling medical marijuana to patients around the world. GW Pharmaceuticals /quotes/zigman/286334/quotes/nls/gwprf GWPRF +3.36% , based in London, markets Sativex, billed as the world’s first marijuana-based medicine.
With a market cap of around $137 million, it’s listed on the Alternative Investment Market, a submarket of the London Stock Exchange. Sativex is currently sold as a mouth spray to help alleviate symptoms of multiple sclerosis in several countries, including the U.K., New Zealand, Germany, Spain, Denmark and Canada, a spokesman says, and it is currently seeking FDA approval in the U.S. for use as a pain reliever in late-stage cancer patients
THE GREEN RUSH
Article from Investor Pro MSN
These are heady times for supporters of legalized marijuana as well as those looking to cash in on pot's growing national acceptance. This month, voters in Washington state and Colorado agreed to legalize the recreational use of marijuana for adults. And medical marijuana is currently legal in 18 states and Washington D.C.
Of course, marijuana remains illegal by federal law. But people involved in what some are calling the "green rush" are still looking at business and investment opportunities in cannabis and its production.
And as with nearly all markets, some people are willing to take the risk.
"Think of it as another dot.com explosion," said Bruce Perlowin, CEO of Hemp Inc. (HEMP +20.83%), in a recent press release.
"It was almost unthinkable 10 years ago that you would have legitimate, fully reporting to the SEC companies that were in the nature of pure plays, with positions in the medical marijuana industry," says Sterling Scott, CEO of Los Angeles-based GrowLife Inc. (PHOT +50.00%), a consortium of companies that sells products for indoor growing.
Scott, a former federal regulatory attorney, estimates there are about 10 cannabis-related companies currently being traded as over-the-counter stocks. Most OTCs are relatively small and often new companies that don't yet meet the requirements to be listed or traded on exchanges like Nasdaq or the New York Stock Exchange.
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| The future of large dispensaries is yet to be determined |
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Scott breaks down these marijuana sector firms into four groups:
o Established companies, like GrowLife, that sell equipment and expendables for the cannabis industry.
o Companies like Medical Marijuana, whose mission, according to its website, is to become the industry's "premier cannabis and hemp industry innovators."
o Groups like Hemp Inc. that are looking to develop a legal market for the industrial and commercial use of hemp (which contains only trace amounts of marijuana's active ingredient) in products such as paper, oils and cloth.
o Companies focused on the clinical, medical use of cannabis in areas such as cancer, inflammation and pain treatment.
"The safest position during the Gold Rush in California in the 1800s was to sell (miners) the equipment they needed to go out and explore for gold," explains Scott. "Our company has taken a fairly conservative position, as to the kind of things that we can engage in, because of the federal law position. And we intend, until there's a great deal more clarity on the federal side, to continue to be fairly conservative. But that's not true of all these companies."
So are these small stocks worth an investor's time? It depends on how the future plays out for the sector.
"If the new marijuana laws in Colorado and Washington… are a sign of things to come, if you're a firm that can benefit by this industry being created into a legal and viable industry, then if you can get in early enough, then those stocks may go up in value," says Mac Clouse, professor of finance at the University of Denver's Daniels College of Business.
