The cannabis industry is thriving during the quarantine. Not only did the industry earn an essential designation, allowing it to continue operating during the quarantine, cannabis sales are spiking to a new all-time high as consumers stock up and blaze away the stress of a global pandemic.
This should be a pivotal week for the broader stock market and the cannabis sector. Global stocks are coming off a tough week – battered by the impact of coronavirus. The S&P 500 had its worst week since the financial crisis, falling 12% in five days.
Canopy Growth Corp (WEED, CGC), the largest cannabis company in the world, jumped 16% today after reporting third-quarter earnings that beat expectations and showed sharp improvements from last year. The strong report should set the tone for the next few months.
After struggling in the second half of 2020, cannabis stocks are off to a hot start in 2020. For example Canopy Growth Corp (WEED, CGC) is up 25% in 2020 and up 65% from the 52-week low in late November.
Weed stocks had a tough third quarter, falling into one of the longest and deepest bear markets ever. However, despite the weakness, I am expecting a rebound in the fourth quarter with a string of good news set to hit the industry.
The cannabis sector has been stuck in a bear market for the last few months. But now – the sector is flashing some early signs that the sell off could be over and the sector is ready for a rebound and new rally.