If you're looking to make money off the legalization of weed by buying stock in a company in the sector just be careful: many are penny stocks that have no analyst coverage, yet.
This article was originally published by Zacks.com.
Are you stressed out and need a release? Boss got you singing the blues? Well if you are in Colorado, you roll a fat one and, as the kids say, "chillax."
I am not sure what "chillax" means, but it appears to be a combination of chill out and relax. Seems to me they want to do the same thing twice as hard, which just gives me faith in our collective futures.
With all the stories of legalized weed, I decided to take a look at this topic a little more closely. I first took a look at Marijuana.com to learn about this green plant and what it can do. Then I saw some tweets about something call "kush" selling for $400 an ounce and I nearly fell back into the couch and dreamed of easy money.
I mean, $400 an ounce, 16 ounces in a pound, it sounds like I don't need to dream of being Walter White anymore... more like Fritz Haber.
The green rush
The gold rush sent tons of people west with the promise of riches hoping that they would "pan out." Today, a similar rush, just of the green variety has people moving west looking to "pot out."
But there are some road blocks in place that are preventing us regular people from just setting up shop in Colorado or Washington. Maybe it would just be easier to buy stock in a company that is already doing that!
Recently I have been watching Growlife and how it has gotten so high lately. Then I saw that it’s a penny stock, and doesn't have a Zacks Rank.
Medbox (MDBX) is another player in this green space. They have a little different take on the business as they have a machine that dispenses medication to individuals based on biometric identification (fingerprints). But the firm is just selling the machines and not the green, so this is an example of buying the bullet makers and not the army in time of war.
MDBX does not have a Zacks Rank either. I am seeing a trend here.
I could ramble on and on and on
I kept looking for a stock that fits this new green space. But the more I looked, the more I found penny stocks that have ripped higher. None of which had a Zacks Rank.
What does that mean for me? Well that means I cannot recommend a good pot stock. I can only sit back and watch as these stocks fire up as the green rush gets underway. What will change my mind and get on board, is if some analysts pick up coverage of the sector. Then, with earnings estimates, the stock would become eligible for a Zacks Rank.
Brian Bolan is a Stock Strategist for Zacks.com.
The information supplied above by Zacks Investment Research Inc. contains opinions based on factual research which may or may not be accurate. Neither Zacks nor Intellisphere will assume any liability for losses from investment decisions based on this information.
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