The Marijuana index has reached it’s highest level since mid-February due to Canada’s strategy to legalize recreational marijuana. The index rose more than 4% on Wednesday to 276 points; the highest level in the last four months.
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The Canadian Senate is likely to vote in favor of Bill C-45 today after which the bill will be sent for Royal Assent. If all goes well, the use of recreational marijuana will be legal for adults in Canada. According to Deloitte, the marijuana industry could generate more than $6 billion for the Canadian economy.
Cannabis stocks are showing a strong reaction to the news. General Cannabis Corp (OTCQX:CANN) is among the biggest gainers. Its stock price soared 30% in Wednesday trade to $4.13 a share.
The company has been setting strong footholds for future growth with its balance sheet and low debt level. Its total current assets increased 450% year over year in fiscal 2018, while its debt declined substantially from the past year.
“Fiscal 2017 was a transformative year for General Cannabis. Our balance sheet has never been stronger. Along with generating record revenues in 2017, we successfully paid down substantial amounts of debt, raised new equity, and significantly increased our book value,” said Robert Frichtel, Chief Executive Officer of General Cannabis.
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MYM Nutraceuticals Inc (OTCQB:MYMMF) is the second-biggest gainer with the stock price gain of almost 17% on Wednesday.
MYM Nutraceuticals is engaged in producing and selling high-end organic medicinal cannabis supplements and topical products. It has stakes in Quebec and a Northern Rivers production project that has the potential to produce 1.5 million and 1.2 million SF of production on an annual basis.
Cronos Group Inc. (NYSE:CRON) and KushCo Holdings Inc (OTCQB:KSHB) shares have also posted double-digit growth after reports of the Senate voting for Cannabis legalization in Canada.
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