Here is the complete list of TOP 100 cannabis companies that I analyze on this site: Cannabis Investing Newsletter. There are some 350 different publicly traded & listed cannabis stocks. But, not all cannabis stocks report financial data with frequency. I have sorted through these cannabis companies to let you determine which are best cannabis stocks and which to stay away from. You will be able to learn a great deal about how to get started in cannabis investing.
Many cannabis companies are still in the start-up stage, and therefore there are a lot of cannabis companies that we could not be certain about their future. To make this list of best cannabis stocks, a cannabis company is currently earning revenues regularly reports financial data consistently. But, this does not mean that the cannabis company is necessarily profitable. I have sifted through about 100 of the 350 companies I have in a more in-depth listing to help you determine which are the best fastest growing cannabis companies. The cannabis companies below have made this list because they are productive and growing cannabis companies, and some below have made my list of Top 10 Fastest-Growing Cannabis Companies.
Further, if you want to see my Top Picks, you can click here to find the best marijuana stocks to buy now. I have sifted through the list of cannabis stocks to determine which are the best marijuana stocks to buy now and which are a bust.
The Complete list of cannabis companies
The best part about this listing is that it is sortable; you can go to the top of the listings and show either the highest numbers or lowest numbers:
Breakdown of financial data & how to get started in cannabis investing
Now that you have seen the list above, what does all of this mean? In this next section, I will break down all of the financial data for these cannabis companies so you can see how to compare the best cannabis companies to each other. Once you have a firm understanding of all of the various numbers you may find it simpler to determine which of these cannabis companies could be the best cannabis investments.
Name & Symbol
Be certain to sort the listings at the top of the data:
You will find the name and symbol of each company in the first two columns. The stock symbols are all linked to each respective company page so you can find even more information to include all of the financial data from the company over various timeframes.
With some of these cannabis companies, I have financial data going back several years and you may find this useful in your analysis and, I encourage you to look deeply at past data so you can determine which cannabis companies will make the best cannabis investment.
Shares Outstanding and Cannabis Investments
Shares outstanding are an important indicator but, it is also important to grasp the concept. The best analogy for cannabis investing and shares outstanding is to imagine going to a cafe to buy a slice of pie.
The question is: How much should the slice of pie cost? The answer is: It depends on how big the slice is. This is a good analogy to the number of shares outstanding for cannabis companies. The more slices, the more people are sharing the pie and, by extension, the lower the price.
Shares outstanding are important to some extent only when you take into consideration other factors such as the amount of revenue per share and profits per share. But, share count itself is not an indicator that you can determine much from it by itself.
I will add more to this concept as we go through this explanation and how to get started in cannabis investing.
Previous Quarter – Current Quarter
Be certain to sort the listings at the top of the data:
The next two columns show revenues for each of the cannabis companies. The third quarter shows the respective change from the previous quarter to the next. This is stated in terms of percent. The higher the number, the faster the growth rate for revenues. But, some cannabis stocks are not growing at all and revenues may have declined every quarter.
To keep cannabis in perspective, the S&P 500 has an average annual growth rate of 3.5%. However, the above chart for Q1 – Q2, 2021, has a quarterly growth rate of 6.215%. Mind you, this is a growth rate that is 8x the average growth rate for the economy versus cannabis. This is why it is possible to earn a significant amount of money with cannabis investing. But, look through the revenue numbers and you can see that many of these companies declined in revenues from the first quarter to the next. That is why it is so important to do sufficient research to determine which cannabis companies will outperform one another.
Revenue Per Share
Revenue per share is a simple math equation that will assist you in determining the price per share. And, as I mentioned above, the per-share count is important. But, you have to take into consideration other factors, and revenue per share would be a factor to consider. The higher the revenue per share then, ostensibly, the higher the price of the stock, all else equal.
Cost of Goods Sold & Gross Margins
Be certain to sort the listings at the top of the data:
Cost of goods sold is simply the cost of producing the products for sale. This is used to figure gross margins. Cost of goods sold is subtracted from gross revenues. The remaining is gross profits. You can take the remaining amount and divide that over total revenue to determine gross margins. You would want the highest number you can get.
Generally, I have found that the best cannabis companies are printing between 60% – 65% in gross margins. Anything above that number is exceptional. Anything below that number may be sub-performing.
It is important to note that some cannabis companies are up-and-coming and still gearing up. This is why it is also important to not only look at this snapshot above but also to look at several quarters worth of data. Perhaps some of these cannabis companies saw a small dip that would be considered a one-time consideration. But, you would not know that unless you looked at many data points.
Total Operating Costs, Operating Profits, & Operating Efficiencies
Total operating costs are costs associated with running a cannabis company. Whereas cost of goods, gross margins, and gross profits deal with making a product, operating costs, operating profits, and operating efficiencies deal with the back-office aspects of a cannabis company.
There are five main things in Total Operating Costs: Sales, General, Administrative, Depreciation, & Amortization. After aggregating these costs, the total amount is subtracted from gross profits (not total revenues) leaving the company with Operating Profits.
But, there is one more metric to look at before anything else: Operating efficiencies. Operating efficiencies are determined by dividing total operating costs over total revenues. This gives us a metric that shows how much money the back office is spending relative to total revenues; and an important metric. When you aggregate this metric you want to see the lowest number possible.
The best companies I have seen usually run between 30% – 35%, but some come below these numbers coming in around the 25% level.
EBITDA Profits & Cannabis Investing
EBITDA stands for Earnings Before Interest, Taxation, Depreciation, & Amortization. This is a Non-GAAP number. It is very useful for cannabis investing since what the metric tells us is if a company’s basic core business plan will work.
Just before Operating Profits, Depreciation & Amortization are taken out of the math. At that point in the income statement, a cannabis company can tell if its core business could be profitable. At that point, gross margins are sufficiently low enough that revenues will cover these costs. Plus, in the operating costs section, the costs for the back-office business portion of the company are being covered. There will still be other costs such as financing costs. But, the rent for the building, salaries for running the company, and other costs are paid for.
Then, it is a matter of scaling up the business and letting marginal profits trickle down to the bottom line or net earnings.
The metric shown here is both EBITDA and EBITDA relative to total revenue. You would want the highest EBITDA profit number but, you would also want the highest EBITDA relative to revenues. This means that you want the highest percentage you could have in this metric.
Cash on Hand, Assets, Liabilities, & Debt/Asset Ratio
The income statement shows how well the company is doing via its revenues, costs, and margins. But, assets and liabilities are equally important.
Cash on hand would be important to keep an eye on if a company is not profitable. Take a look at the losses for the company for the respective quarter. Multiply that by 4x. This will give you a general idea of how much money the company is burning through; this is the “burn rate”. Ask the question: Is there enough for more than one year of cash on hand given the burn rate? If so, and assuming the company does not suddenly turn profitable, then the company would not need to raise more cash.
Should a company need to raise more cash they may need to issue more shares of stock. This means they are diluting the existing shareholders which would not be good. Typically, this act pushes the stock price lower.
Assets & Liabilities
Assets and Liabilities are an important metric to keep track of. Most cannabis companies are well situated with assets and liabilities. But, some are “upside down” meaning they owe more money than they have assets to cover. This can cause serious problems should a company try and finance operations. If a cannabis company does not have any assets to secure financing then they may not be able to get enough money to cover operations.
On the other hand, if a cannabis company has plenty of assets to cover their potential financing needs they would very likely get favorable financing terms. This would be a distinct advantage.
Ultimately, management’s job is to create shareholder value. Given that purpose, you would want to check to see if assets are increasing more in value relative to liabilities. If so, this will ultimately lead to increased share-holder value and, by extension, increasing stock price.
The debt/asset ratio is a simple math equation telling us what the ratio of debt to assets is. You want to see the lowest possible number. You would definitely not want to see a number at, or near, 1.0. Anything over 1.0 and the company is officially upside down with debts exceeding assets.
Book Value Per Share
The final number in this list to TOP 100 Cannabis Companies is the per share book value. This could be a useful tool to show if a company would be a solid cannabis investment. What per share book value shows is how much a company could get on a fire sale basis for all of the company assets. Once you have a good idea about this number you can check the current share price to determine if this is an undervalued cannabis investment.
Right now, cannabis companies are significantly undervalued relative to the broader market. Per share book value is a good start to look to see what could be possible for a company’s stock price.
TOP 100 Cannabis Companies
My goal is to keep this list up-to-date as frequently as possible. Given this, I can continually watch how these companies perform relative to other companies and whether they would be solid investments. I found this list to be quite useful, and hopefully you did as well.
Should you want a more extensive break down of what these metrics are you can find them here on my latest article on.