Ancillary marijuana stocks may not be the first choice for some cannabis investors. But, these companies do have a lot to offer. For one, ancillary pot stocks allow investors to have exposure to the cannabis industry, without the high level of volatility that certain pot stocks may carry. Second, ancillary pot stocks can show a solid amount of growth potential outside of just the cannabis industry. This is due to the fact that many of these companies have large businesses that were started well before their foray into marijuana. On the other side, ancillary pot stocks can mean that investors are not able to reap the full benefits of the growing cannabis industry.
When it comes to finding these pot stocks to watch, investors can rank ancillary companies based on their involvement in the cannabis industry. While a company like KushCo Holdings Inc or Scotts Miracle-Gro inc. (NYSE:SMG) may have a big role in the cannabis industry, these companies are not fully considered to be pot stocks. On the other hand, ancillary pot stocks like Innovative Industries Inc. (NYSE:IIPR), GrowGeneration Corp. (NASDAQ:GRWG) and Brinks Co. (NYSE:BCO), are more crucial to the industry’s growth. With that in mind, here are two ancillary marijuana stocks to watch for the next few weeks and beyond.Ancillary Pot Stock Spotlight: GrowGeneration Corp. (NASDAQ:GRWG)
GrowGeneration Corp. (NASDAQ:GRWG) is one of the leading ancillary pot stocks to watch. As of mid-August, GRWG stock was trading at around the $10 mark. Two weeks into September, it now trades at roughly $15. That is quite a large increase for a NASDAQ listed stock, let alone a marijuana stock. One of the main reasons for this big jump comes from GRWG stocks latest report. In its last quarter, the company reported that its sales had jumped by over 100%. This is a major growth amount, and one that should not go unnoticed.
For those who don’t know, GrowGeneration works as a provider of hydroponic grow solutions to those who wish to grow cannabis. Currently, GRWG stock trades at roughly 150 times its forward earnings. While this may seem high, its most recent report shows that there could be a lot of growth left to occur. Because of this, investors should keep GRWG stock on their radar moving forward.A Top Pot Stock for 2020
Innovative Industrial Properties Inc. (NYSE:IIPR) is one of the best performing marijuana stocks of 2020. Although it is an ancillary pot stock, IIPR stock has a big role in the cannabis industry. The company purchases properties that are then leased out to those who wish to grow cannabis. Because of this business model, IIPR is able to secure stable income and solid growth. As a REIT, IIPR stock is required to pay out a large amount of its profit in the form of dividends.
This means that investors are able to get a nice sum of money on top of any return that the stock may have brought in. With demand for cannabis shooting up due to Covid, more and more companies are working to grow larger quantities of cannabis. This means that IIPR stock could see some more momentum if all things go accordion to plan. Year to date, IIPR stock is up by as much as 70% which is very substantial. In a stock market that can be wildly unstable, IIPR stock may just be the pot stock to watch.