The COVID-19 pandemic proved the cannabis industry’s staying power as sales increased with stay at home orders across the US. Now, the market is ripe with opportunities and three companies – Curaleaf Holdings, Inc. (OTCQX: CURLF), CLS Holdings (OTCQB: CLSH), and Indoor Harvest Corp. (OTC: INQD) – are emerging as strong contenders to become 2021’s top marijuana penny stocks.
Top Marijuana Penny Stocks: Catalysts
A leading international provider of cannabis products, CURLF operates in 23 states with a comprehensive cultivation, processing, and dispensary framework. Because of its success and strong fundamentals, CURLF is one of the higher valued stocks on the OTC markets with room for further expansion.
Broadening its horizons beyond the US, Curaleaf International’s subsidiary Adven GmbH has already launched medical cannabis products in Germany – Europe’s largest medical cannabis market. Curaleaf International is an established vertically integrated cannabis company which has quickly become the most wide-reaching in Europe thanks to its unique European supply chain which covers every dimension of operations.
But across the pond, Curaleaf is working to expand its growth in the tri-state region of New Jersey, Connecticut and New York, which the company estimates to hold a potential annual market opportunity of about $8 billion if recreational cannabis sales are allowed. At the moment, CURLF is expecting legalization in New Jersey, Connecticut, and New York in late 2021, Q2 2022, and early 2023, respectively. This symbolizes an overall shift in state specific legislation as the country moves from medical marijuana use to recreational as well.
Cannabis Life Sciences Holdings (CLSH) is working to capitalize on this shift thanks to its leading position in Nevada’s cannabis industry. With an estimated 42 million in tourists per year, Las Vegas has the thriving consumer base necessary for CLSH’s Las Vegas dispensary and wholesale brand, City Tree, to accelerate its already significant growth. Having distinguished itself through its Q2 report, CLSH has an established and growing revenue stream which could enable its expansion into nearby states. While CLSH has mentioned this expansion on its website, speculative investors may see the Biden administration’s supposed support of cannabis legalization as a catalyst for CLSH’s expansion along with the market.
But for now, Nevada’s cannabis market is valued at $803 million for 2021 but is expected to reach $980 million in 2022. Currently, CLSH’s proprietary process gives it an edge in Nevada’s burgeoning market because it produces high quality products at a higher yield than competing cannabinoid extraction processes. This has allowed CLSH’s brand to become synonymous with quality and has attracted a loyal clientele of connoisseurs or “pot pros” from across the state. CLSH intends to capitalize on this process by generating a future revenue stream from licensing to third party producers in both American and global cannabis markets.
Meanwhile CLSH’s Nevada neighbor – Indoor Harvest Corp. (OTC: INQD) – is specializing in cannabis medicine and the development of CBD, hemp, and hemp-related products. Bullish investors have confidence in INQD thanks to its CEO, Leslie Bocskor, who has an extensive banking and investment background. A leading name in the cannabis industry, Brocskor is also the founder of Electrum Partners which specializes in medical and recreational cannabis. Speculations that INQD has plans to enter into hemp plastic have been fueled by the CEO’s expansionary plans and are contributing to the hype surrounding INQD.
However, INQD is not yet current with the OTC Markets. In a NT 10-Q disclosure, the company explains that it was unable to meet the August 16th deadline “due to circumstances related to the surge of the coronavirus” and that it anticipates filing its 10-Q on or before September 3. This will affect the variety of accounts able to trade INQD because the E-Trade deadline for trading defunct stocks is August 27th whereas TD Ameritrade has a cutoff of September 3rd. With this in mind, some investors may have an opportunity to invest in stocks off-limits to others. But at this time, INQD is making all efforts to meet the SEC’s September 28th deadline for reporting.
FinTwit influencer, @WeedStreet420, drew attention to this dip buying opportunity, tweeting “Can you believe you can buy the world’s largest cannabis company at the same price it was in May 2019?”.
While Cannabis Life Science Holdings is mostly undiscovered, we are happy to bring OTC investors’ attention to a promising stock that likely won’t stay secret for long.
Baller, baller @stockballa – OTC FinTwit’s favorite speculative trader with 40.3K followers – has been tracking INQD throughout August.
Curaleaf Holdings, Inc.
Continuously increasing its revenue, the company made $627 million in 2020 – nearly triple the revenue of the previous year. Similarly, the company saw a 20% increase in 2021’s Q2 revenue and a 166% increase YoY. At this rate, CURLF is on track to break the $1 billion revenue mark before EOY.
Currently trading at only $11.18, the stock is at one of its lowest points so far this year. CURLF appears to have bottomed out at a price point last seen in December, putting its support near 10.98. While it’s possible for the stock to fall further, its sudden spike on August 20th indicates some volatility and potential to hit its resistance near 12.29. Accumulation has downtrended slightly since the 11th while the MACD remains on the downside, positioned for a crossover with the downtrending signal line. The RSI is at 47.5 and is trending upwards.
CLS Holdings USA, Inc.
Currently trading at $.165, CLSH has a recent support line near 0.14 and a resistance near 0.195 its secondary resistance is near .245. Its accumulation has bottomed out but its RSI is hovering near 51.09. At the moment, the MACD is showing upwards movement but does not seem ready for a crossover. However, the stock has 250 million authorized shares, of which 83 million are unrestricted. Given its low float of roughly 29 million, CLSH could blow through its resistance with any catalyst.
While the company reported around $4.5 million for Q1 earnings, its net loss was roughly $3.7 million. But only $456,326 of that was lost from operation expenses. The company also has cash and cash equivalents worth $2.2 million. The company’s working capital has improved thanks to the reclassification of some of the $19 million in convertible notes which were due October 2021. Now, the holders of $13.5 million of these notes approved the amendment and extension of their notes by one year.
Indoor Harvest Corp.
Trading at $.0183, INQD has made gains over recent weeks cementing a support line of .0157, a secondary support near .0141, and an underlying support of .0119. Its resistance level was determined by its August 16th high of .0196. INQD’s RSI is trending upwards at 62.06 and accumulation is also rising. The MACD is on the upside following an aftermarket crossover on August 20th. Anticipation that INQD will become pink current by September 3rd will likely drive market movement and this catalyst could trigger a surge in stock value. Its recently disclosed 10-k ending September 30th, 2020 shows no revenue and a NOL of $191,938 for 2020 in addition to a NOL of $514,428 for 2019.
Should You Buy?
With the ongoing legalization of marijuana in the U.S and the potential for another covid-related boom, these three cannabis stocks could become the top marijuana penny stocks of 2021. CURLF is currently offering a low entry point into a stock with booming potential and INQD has an upcoming pink catalyst driving speculative momentum. Meanwhile CLSH’s fundamentals depict a company on the verge of expansion into the ever growing cannabis industry. Each of these stocks have its own angle on the market but investing in INQD is risky considering its lack of reporting.
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