President Biden’s Decision Not to Run for a Second Term Could Be a Massive Catalyst for Cannabis Stocks

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President Biden’s Decision Not to Run for a Second Term Could Be a Massive Catalyst for Cannabis Stocks

Up until recently, there wasn’t a whole lot of hope that there would be any reason to be optimistic about ********** legalization in the near future. The *********** party takes a traditionally hard stance on drugs. Current President Joe Biden has been in power for nearly four years now, and there hasn’t been any sign that significant change is coming. While there is hope that ********** may be rescheduled and will no longer be a Schedule I substance, that would still fall well short of legalization, which many investors and businesses are still hoping for.

However, the news that President Biden will not seek reelection opens the door to a new possibility. A new presidential candidate may be more eager to make significant moves on ********** reform, potentially leading to legalization. While there’s still plenty of uncertainty ahead, cannabis investors may have more reason than ever to be bullish on the prospects for legalization.

Kamala Harris could be more likely to push for significant reform

Vice President Kamala Harris looks to be the odds-on favorite to lock up the Democratic nomination. And that could be an extremely positive development for cannabis investors, as Harris would be much more likely to push for ********** reform as president.

Back in 2019, Harris said she was in favor of legalizing ********** and even admitted to trying it in college. She is also critical of the *****’s current classification as a Schedule I substance. Harris stated, “********** is considered as dangerous as ******* and more dangerous than fentanyl, which is absurd, not to mention patently unfair.”

If Harris ends up winning the nomination, investors will learn more about her platform and plans (if any) for ********** reform. With the bulk of the population supporting some sort of cannabis legalization, it has the potential to be a political issue that could sway voters, and thus, there’s a significant incentive for her and any other potential candidate to not overlook it as a key issue.

Cannabis stocks which could rally on legalization hopes

When there’s talk of ********** legalization, cannabis stocks often soar on the hopes that reform could finally be coming for the industry in the U.S. While ********** is legal in Canada, many *********-based cannabis companies are eyeing U.S. expansion for its plentiful growth opportunities. And even though cannabis is legal in dozens of states in the U.S., it ******** ******** at the federal level, which means it can’t cross state lines, nor can it cross the federal border.

Legalization would be what Canopy Growth (NASDAQ: CGC) has long been waiting for. Five years ago, the company entered into an agreement to acquire multi-state ********** operator Acreage Holdings once ********** became legal. That hasn’t happened, so Canopy Growth has created a

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, Canopy USA, to house its U.S.-based investments and ******** the Acreage deal. News of ********** legalization would surely send the stock flying,

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.

There’s also Tilray Brands, which has been positioning itself for growth opportunities in the U.S. market. It has been expanding into alcohol brands as a way to build up its presence in the U.S. and potentially, one day, take advantage of those acquisitions and produce cannabis-infused beverages, which could be a big growth opportunity for not just cannabis companies but alcohol businesses as well.

A sometimes forgotten group of **** stocks are the multi-state operators, including Trulieve Cannabis and Curaleaf Holdings, which are among the largest cannabis companies in terms of revenue. Legalization would remove many obstacles for those types of businesses, making it easier for them to obtain banking services, leverage economies of scale to expand their operations into different states, and allow their shares to trade on major exchanges such as the Nasdaq and NYSE.

Is now the time to buy **** stocks?

Investing in cannabis can be enticing as there’s certainly a lot of potential upside if legalization occurs. But the problem is that cannabis investors have been holding onto those hopes for years, and yet nothing has materialized. The danger is that if you buy **** stocks, you could end up waiting for a long time for something to happen.

While Kamala Harris winning the presidential election could be great news for the cannabis industry, investing in **** stocks solely for the purpose of ******** on legalization has proven to be a risky strategy. Investors should tread carefully here because there is still plenty of risk out there. And as tempting as it may be to buy shares of Canopy Growth and Tilray Brands because of their depressed valuations, investors may be better off investing in an exchange-traded fund, which can help reduce some of the risk that comes with investing in **** stocks.

Should you invest $1,000 in Canopy Growth right now?

Before you buy stock in Canopy Growth, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 

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for investors to buy now… and Canopy Growth wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $657,306!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.

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*Stock Advisor returns as of July 29, 2024

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has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Trulieve Cannabis. The Motley Fool recommends Nasdaq and Tilray Brands. The Motley Fool has a

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was originally published by The Motley Fool

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#President #Bidens #Decision #Run #Term #Massive #Catalyst #Cannabis #Stocks

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