Medical marijuana stocks are smashing the broader market by a huge margin in 2016. Companies like Cannabis Science Inc. (OTCMKTS: CBIS) and CannaGrow Holdings Inc. (OTCMKTS: CGRW) have seen shares soar 14.8% and 37% this year, respectively.
And we expect this to continue for five important reasons…
Bullish Reason for Medical Marijuana Stocks No. 5: Surging U.S. Sales
Sales of cannabis in the United States are projected to increase a hefty 25% this year to $6.7 billion. Driving this explosive growth will be the widespread acceptance of medical marijuana…
According to ArcView Market Research, marijuana use for medicinal purposes alone will bring in more than $10 billion in sales by 2020. That's up from less than $5 billion in 2015.
This massive rise in revenue will also increase the overall value of the market. Bank of America Merrill Lynch reported the U.S. marijuana industry could be worth roughly $30 billion annually by 2020. That's three times bigger than the National Football League's annual revenue of $10 billion.
Bullish Reason for Medical Marijuana Stocks No. 4: Growing List of Applications
Cannabis is used to treat a number of ailments and diseases. The list continues to expand as research continues to grow and bring new findings.
Medical marijuana has been known to treat the following diseases…
AIDS, Alzheimer's disease, arthritis, asthma, cancer, gastrointestinal disorders, epilepsy, glaucoma, migraines, multiple sclerosis, and various psychological conditions
Marijuana advocates hope new medical cannabis research will generate even more research and uses for cannabis. That will increase marijuana's credibility among medical professionals.
Bullish Reason for Medical Marijuana Stocks No. 3: Widespread Legalization
Marijuana legalization has become a huge movement across the United States, and it's not slowing down anytime soon.
Currently, there are 25 states – and Washington, D.C. – that allow medical marijuana use. The list of states includes…
Alaska, Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, Ohio, Oregon, Pennsylvania, Rhode Island, Vermont, Washington
That list will increase this fall once more than 20 states vote on cannabis legalization in November.
Bullish Reason for Medical Marijuana Stocks No. 2: Growing Number of Dispensaries
As more states get on board with marijuana legalization, more dispensaries and other pot retailers will open up shop.
In fact, one state is making headlines this week as it prepares to open its first dispensary location…
Yesterday (Wednesday, July 20), the Florida Department of Health granted dispensary organization Trulieve permission to open a location in Tallahassee. It will be the state's first cannabis dispensary and will start delivering marijuana throughout the state. Trulieve is set to open in Tallahassee on Tuesday, July 26.
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While Trulieve will only sell to a narrow range of patients, medical marijuana could soon be available for a wider range of conditions. Florida is one of the states set to hit the polls in November to vote on legalization.
More and more officials are starting to realize the benefits of medical marijuana to patients and states. In fact, 2016 could be a breakout year for medical marijuana.
This last reason shows why one of the most controversial topics of 2016 will be bullish for pot stocks in 2016…
Bullish Reason for Medical Marijuana Stocks No. 1: U.S. Politics
Both the Democratic and Republican stances on medical marijuana will fuel research and boost cannabis stocks in 2016.
On July 10 at the Democratic National Committee's 2016 National Platform, Democrats voted on an amendment to legalize marijuana in the United States. The pro-legalization camp won by a narrow margin, with the vote coming in at 81 to 80.
Democrats claimed they will support policies allowing more cannabis research to be done. They will also support changing laws to allow dispensaries to operate without being shuttered or prosecuted by the law.
Meanwhile, the Republican Party will be pressured to act on marijuana legislation at the federal level. It's leaning toward legalizing cannabis as fresh research expands on its effectiveness and revenue-generating possibilities.
Money Morning will continue to cover the cannabis market in 2016. Later this summer, we'll also share a carefully curated list of the best U.S. marijuana stocks to buy. So make sure you check back soon.