Marijuana and the industry around it are in the news a lot lately -- consider keeping an eye on it, not only for interesting information, but also possible investment opportunities.
Image source: Brett Levin via Flickr.
Here are 11 interesting things to know about marijuana:
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About 44% of Americans have tried marijuana, according to a 2015
Gallup poll. The percentage has grown steadily since Gallup first asked
the question in 1969.
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Fully 11% of Americans (more than 1 in 10) reported to Gallup in 2015 that they currently smoke marijuana.
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Support for the legalization of marijuana has been growing, with 53%
of Americans in favor of it as of 2015, per a different Gallup poll.
Support is stronger among younger folks than older ones, and weaker
among Hispanics than among whites and African-Americans.
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Americans are especially likely to favor legalization of marijuana
for medicinal purposes. The drug has been found useful to treat
glaucoma, epilepsy, inflammatory bowel diseases, arthritis pain,
multiple sclerosis pain, and chemotherapy pain and nausea. Other
possible uses include curbing the growth of cancer cells and Alzheimer's
disease, stimulating appetite, and treating anxiety.
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It's not all good news for the drug, though. Like regular tobacco, it
contains carcinogens, and inhaling a lot of smoke is not good for
anyone. Though it may be less addictive than other drugs, some people do
become dependent on it. It can impair driving ability, too. Many
studies find marijuana to be less harmful than alcohol or tobacco, but
that doesn't mean it's safe.
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Folklore has it that Shakespeare may have smoked marijuana, and that
Queen Victoria might have used it to alleviate monthly cramps. It's also
reported to have been recommended as a substitute for alcohol by
prohibition campaigners in the 19th century.
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Legalizing marijuana could deliver significant tax revenue to
governments seeking just that. In its first year after legalizing
marijuana, the state of Washington collected about $70 million in taxes.
For Colorado, it was $53 million -- and marijuana tax revenue is
outpacing that from alcohol in the state. The Cato Institute has
estimated that state governments and the federal government could save
around $8.7 billion through the legalization of the drug.
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Growing marijuana, like growing many other crops, requires a lot of
resources. According to Mother Jones magazine, California's crop
requires 50% more water during its growing season than the city of San
Francisco uses in a year -- some 60 million gallons. In Denver, it's
estimated that less than 2% of the city's electricity usage is for
growing marijuana -- but that rate is growing rapidly.
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The marijuana industry in the U.S. was recently estimated to be worth
about $3.5 billion, with California research company ArcView seeing
that growing to $4.4 billion this year.
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Growing marijuana can be surprisingly profitable, with a 2015
Bloomberg report noting that while the wholesale rate for medical
marijuana was $2,500 per pound, it was costing a Colorado grower just
$600 to produce the stuff. A Forbes article posited that "Legal Cannabis is 2015's best start-up opportunity."
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You can make money (or lose it!) in medical marijuana without growing
any yourself -- by investing in marijuana-centered companies. While
there can be plenty of money for companies in growing and selling the
stuff, big bucks can also be made by developing effective pharmaceutical
drugs derived from it. Here are two publicly traded companies to look
into:
GW Pharmaceuticals (NASDAQ:GWPH) is a biopharmaceutical company with a market value of $1.2 billion, while Insys Therapeutics (NASDAQ:INSY) is another, with a market value of $1.8 billion. Both stocks have dropped in recent months, presenting better entry prices for long-term believers, but it's also quite reasonable to wait for this nascent industry to grow more and to see which companies emerge as profitable winners.
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