For an industry facing as many unknowns as the cannabis sector, such a run of good news is hard to imagine, something investors would be wise to keep in mind – The official legalization of recreational cannabis in Canada means that the marijuana industry is about to face its harshest spotlight yet.
And with stocks trading at “infinity times earnings” according to Barry Schwartz, chief investment officer and portfolio manager at Baskin Wealth Management, the expectations don’t get much higher.
“We’ll see when the earnings start to roll in if it’s true or not,” Schwartz said in an interview earlier this month, noting that current valuations, in his opinion, “reflect every single thing that can go positive to the end of time for cannabis.”
Among the basic questions that remain to be answered is just what the demand for legal cannabis will be in Canada. While Deloitte has predicted up to $7.17 billion in total cannabis sales next year, and others have projected that figure to rise toward $10 billion in the coming years, they remain estimates.
Geoff Zochodne – National Post – October 17, 2018.
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