Marijuana shares usually carried out properly within the first half of 2019, with a few of them downright smoking scorching, although there have been naturally some losers, too.

Because the calendar flips to July and the second half of the 12 months will get beneath means, these three cannabis shares are value carefully watching: prime Canadian cannabis grower Cover Progress (NYSE: CGC), actual property funding belief Progressive Industrial Properties (NYSE: IIPR), and ancillary cannabis participant EnWave (NASDAQOTH: NWVCF) (TSXV: ENW).

Why this trio? All three are going into the second half of 2019 with sturdy momentum and, extra importantly, they’re among the many cannabis shares that presently appear most promising as long-term investments.  

A big hemp area with a farmhouse and blue sky in background.

Hemp farm. Picture supply: Getty Pictures.

Overview 

Firm 

Nation

Market Cap

Worthwhile (TTM)?

Dividend

YTD 2019 / 2-Yr Efficiency*

Cover Progress 

Canada

$13.9 billion

No

N/A 50% / 564%

Progressive Industrial Properties

U.S.

$1.2 billion

Sure

2%

171% / 621%

EnWave

Canada

$198 million

No

N/A 87% (OTC in U.S.) and 82% (TSX) / 127%(TSX)**

S&P 500

1.9%

18.5% / 26.5%

Knowledge sources: Yahoo! Finance and YCharts. TTM = trailing 12 months. YTD = 12 months so far. OTC = over-the-counter. TSX = Canada’s TSX Enterprise Change. *Two years is the longest whole-year comparability interval doable. **EnWave has traded OTC for lower than two years. Knowledge as of June 28, 2019.

Cover Progress

Cover Progress has the excellence of getting the most important marijuana inventory by market cap. It is a prime cannabis grower, with a manufacturing capability extensively thought-about to be second behind fellow Canadian grower Aurora Hashish.

(NYSE: STZ) are developing cannabis-infused beverages, which they hope to bring to market in Canada late this year, pending regulatory approval. " data-reactid="41">The corporate sells medical and leisure marijuana in Canada, which legalized cannabis for leisure use in October, and likewise markets medical marijuana internationally. Earlier this 12 months, Cover threw its hat into the U.S. hemp market, which opened on Jan. 1 when the U.S. Farm Invoice went into impact. The corporate, which is developing a manufacturing facility in New York state, expects to have hemp-derived cannabidiol ( CBD) merchandise out there to U.S. customers by late this 12 months or early in 2020. ( CBD is a nonpsychoactive chemical that is been linked with numerous medicinal advantages.) Furthermore, Cover and its accomplice Constellation Manufacturers (NYSE: STZ) are growing cannabis-infused drinks, which they hope to convey to market in Canada late this 12 months, pending regulatory approval. 

fiscal fourth quarter, the company's revenue rocketed 313% year over year to $94.1 Canadian, driven by Canada's new adult-use market. Its net loss widened by nearly a factor of 6 to CA$323.4 million, because of its aggressive investments to scale up and expand its business. The company remains flush with cash. It had CA$4.5 billion in cash and cash equivalents at the end of the period, thanks to its partnership with Constellation Brands. Last fall, Canopy received $4 billion when the alcoholic-beverage giant raised its stake in it to 38%." data-reactid="42">In its just lately reported fiscal fourth quarter, the corporate’s income rocketed 313% 12 months over 12 months to $94.1 Canadian, pushed by Canada’s new adult-use market. Its web loss widened by almost an element of 6 to CA$323.Four million, due to its aggressive investments to scale up and broaden its enterprise. The corporate stays flush with money. It had CA$4.5 billion in money and money equivalents on the finish of the interval, due to its partnership with Constellation Manufacturers. Final fall, Cover obtained $Four billion when the alcoholic-beverage large raised its stake in it to 38%.

Inside of cannabis greenhouse displaying constructing’s body and followers.

Picture supply: Getty Pictures.

Progressive Industrial Properties

REIT) that specializes in properties used for growing and processing cannabis." data-reactid="69">A marijuana firm that is not solely worthwhile but additionally pays a dividend seems like an oxymoron, however Progressive Industrial Properties is the true deal. The San Diego-based firm, which has been publicly traded since December 2016, is an actual property funding belief (REIT) that makes a speciality of properties used for rising and processing cannabis.

Whereas Progressive Industrial is comparatively new and small, it is rising like a weed. As of Might 7, it owned 19 properties that had been 100% leased to state-licensed medical-use cannabis operators in Arizona, California, Colorado, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New York, Ohio and Pennsylvania, with a weighted-average remaining lease time period of about 15.2 years. The corporate makes use of triple-net leases (whereby tenants pay property taxes, insurance coverage, and sure upkeep bills) with built-in hire will increase.

Q1 2019, Innovative Industrial Properties' revenue surged 146%, earnings per share soared 267%, and adjusted funds from operations (AFFO) per share jumped 135% year over year. AFFO is a key profitability measure for REITs, as it drives dividend changes." data-reactid="71">In Q1 2019, Progressive Industrial Properties’ income surged 146%, earnings per share soared 267%, and adjusted funds from operations (AFFO) per share jumped 135% 12 months over 12 months. AFFO is a key profitability measure for REITs, because it drives dividend adjustments.

EnWave

EnWave is an ancillary cannabis participant (that means it does not contact the stuff), which producers, licenses, and installs tools for dehydrating natural supplies, together with marijuana and hemp. This enterprise accounted for simply 23% of its complete income in its just lately reported fiscal second quarter, so the corporate is much from a pure play on cannabis. Its major enterprise is producing all-natural dried cheese snacks utilizing its proprietary radiant vitality vacuum (REV) dehydration know-how.

EnWave appears little-known amongst U.S. traders, which might be as a result of it is a small, foreign-based firm and its inventory trades over-the-counter (OTC) in america. However it’s positive to grow to be extra found, due to the wave of royalty-bearing license and gross sales agreements it has been inking with main Canadian cannabis growers, together with Aurora and Tilray. Growers are adopting REV tech largely as a result of it is reportedly sooner than different dehydration or drying applied sciences.

In fiscal Q2, EnWave’s income soared 110% 12 months over 12 months, and its earnings per share got here in at breakeven for the third quarter in a row. So the corporate appears on the verge of profitability. 

A warning: EnWave is a thinly traded inventory, significantly within the U.S., which suggests it has the potential to be fairly risky.  

Extra From The Motley Idiot

 

Beth McKenna owns shares of Cover Progress. The Motley Idiot owns shares of and recommends EnWave. The Motley Idiot recommends Constellation Manufacturers and Progressive Industrial Properties. The Motley Idiot has a disclosure coverage.