Last year was a historic one for marijuana legalization, and a boffo year for marijuana stocks. Most marijuana investors enjoyed massive gains in 2016. A number of smaller, over-the-counter marijuana companies even registered gains of more than 100% on the year.
Unfortunately, what was a landmark election for marijuana in November could end up being a bittersweet victory.
For one, medical and/or recreational marijuana won legalization votes in eight out of the nine states it was on the ballot in November. The most noteworthy accomplishment for marijuana stocks on Election Day was California’s vote to legalize recreational marijuana use. While that would seem like a boon for marijuana investors, legalized marijuana is actually a headwind for a number of related companies because easier personal access to cannabis hurts their causes.
Of course, the flip side is that Donald Trump’s surprising victory in the election may have derailed the marijuana movement. Trump quickly appointed Alabama senator Jeff Sessions as attorney general — a move that probably squashes any hope of federal marijuana legalization in the near future.
The future is less certain than it seemed. For those and other reasons, investors should dump or avoid these three big-name marijuana stocks. At least for the time being.
Marijuana Stocks To Sell: GW Pharmaceuticals (GWPH)
GW Pharmaceuticals PLC- ADR (NASDAQ:GWPH) is the golden boy of U.S. marijuana stocks. That’s because it’s one of just a few marijuana stocks listed on a major American stock exchange.
Also, GWPH doesn’t need U.S. federal marijuana legalization as long as it gains FDA approval for its drugs, so its future seems far less uncertain than other marijuana stocks.
GW Pharma recently announced positive Phase 3 data on Epidiolex for treatment of Dravet syndrome — a rare brain dysfunction. The news sent GWPH stock soaring 63% in 2016, and investors are hoping that momentum carries over into 2017.
The only problem for shareholders is that the company seemingly has run out of positive catalysts for the time being. GWPH’s Epidiolex story is right on track. However, the company will submit the new drug application (NDA) for Epidiolex in the first half of 2017 … and after that submission, GWPH shareholders might have to wait until the end of 2017 for the next piece of good news.
Without a reason to buy, investors and traders might take some of their profits off the table, especially in the first few months of the year.
Marijuana Stocks To Sell: Insys Therapeutics (INSY)
Insys Therapeutics Inc (NASDAQ:INSY) shareholders won’t be taking…
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