Owning shares of marijuana stocks PMD, MJNA, and Cana will definitely make your next conversation about investing more livelier!
Psychemedics Corporation (Nasdaq: PMD), Medical Marijuana Inc. (PINK: MJNA) and General Cannabis (PINK: CANA) are three stocks in a niche but growing industry: Marijuana or more specifically, medical marijuana. Unfortunately, most marijuana stocks are like MJNA and CANA as they do not trade on major stock exchanges (however, drug testing firm PMD is listed on the Nasdaq). Nevertheless, will an investment in marijuana stocks like PMD, MJNA and CANA lead to “high” returns for an investor? Here is a closer look at all three to help you decide:
Psychemedics Corporation (Nasdaq: PMD) uses analysis of hair samples to test for the use of abused substances like marijuana. For 1Q2011, Psychemedics reported that revenue increased 34% from $4.5 million to $6.0 million – the highest level of first quarter revenue in the history of the company. PMD’s net income also rose 60% from $506,000 to $858,000. Psychemedics recently closed at $9.25 and has a 52 week trading range of $6.89 to $11.12 a share. PMD’s market cap is just above 48 million and the stock also pays a “high” dividend of $0.12 or a dividend yield of 5.19%.
Medical Marijuana Inc. (PINK: MJNA)
aims to be the world’s premier cannabis and hemp industry innovator by investing in the hemp and medical marijuana industries and by coming up with tracking systems that allow those in the medical marijuana industry to operate within the law. Medical Marijuana Inc. is also an interesting company given that its run by someone who was said to be the largest marijuana “importer” in history (for which he was sentenced in 1983 and released in 1991). Moreover, MJNA recently announced plans to bottle and distribute water with CBD, a cannabis extract that lacks psycho-active ingredients of marijuana which are known as THC, to try and grab a piece of the massive bottled water market. Medical Marijuana Inc. recently closed at $0.10 and has a 52 week trading range of $0.03 to $0.23 a share. MJNA has a market cap just over $22 million.
General Cannabis (PINK: CANA)
, formerly LC Luxuries Limited, supports the medical marijuana market with management services, Internet websites, financial services and lobbying. More specifically, CANA’s subsidiary, General Health Solutions, Inc., manages 10 medical cannabis clinics in California while its website Weedmaps.com, a dispensary finder site, has over 2,000,000 page views per month. General Cannabis recently reported that total revenues for 1Q2011 increased 55% from $1.7 million to $2.7 million thanks to continued strong growth of WeedMaps Media (the operator of Weedmaps.com). CANA’s Net income from continuing operations was $4,000 verses $239,000 but they would have been approximately $770,000 if not for amortization expense and office relocation expenses. General Cannabis recently closed at $3.51 and has a 52 week trading range of $.02 to $5.60 a share. CANA also has a market cap that is just below 300 million.
The bottom line: I am not so sure if investors will get a high on a marijuana stocks (but whether we like it or not, marijuana and medical marijuana are certainly growing industries) but owning shares of PMD, MJNA and CANA will definitely make a conversation about investing more livelier – especially if you are in a pub!