The marijuana boom is a genuine investment opportunity, but only if you separate the hype from reality. Problem is, the cannabis “green rush” is generating clouded judgment among investors, especially when it comes to penny stocks.
The buzz over marijuana penny stocks reminds me of the gold-crazed miners in the 1948 movie classic The Treasure of the Sierra Madre. The prospectors in this movie are so blinded by greed, they end up with nothing but self-imposed woe.
The media these days are fixated on pot stocks and all it takes is a positive news event to send a marijuana company’s shares soaring…or a mere whiff of bad news to send a pot stock plummeting.
That said, there are many entrenched, long-term tailwinds for the marijuana industry. Cannabis is no mere fad. One such tailwind is generational.
Talkin’ ’bout my g-g-generation…
Much is made of Baby Boomers (which is my generation) and the marijuana boom. After all, it was the Woodstock generation that made Mary Jane synonymous with youthful rebellion.
However, according to a new report from New Frontier Data, the generation to watch are the Millennials, aka Generation Y (the demographic group that directly follows Generation X).
Now in their late 20s to early 40s, Millennials are becoming parents themselves. There are about 72 million Millennials in the U.S. Members of this group were born between 1981 and 1996. I wrote about this generation and their relationship to marijuana, back in 2019.
Read This Story: Millennials and Marijuana: Agents of Change
The New Frontier report, released June 15, shows that much has occurred over the last few years, in terms of this consumer base and its relationship to cannabis.
The report found:
- 80% of Millennials say that marijuana should be legalized.
- As the first mainstream cannabis adopters with disposable income, almost half (49%) spend between $50 and $200 per transaction.
- 39% of Millennial users report consuming multiple times a day but with greater disparity between men and women than other groups.
- Millennials substitute cannabis for sleep medication at higher rates than other groups (77%).
- 66% identify strain as very important in influencing their purchasing decision, speaking to their sophistication as consumers.
- Given their status as parents of young children, compared to other groups, Millennials are more interested in consuming away from home, i.e., at someone else’s home (51%) or on vacation (17%).
For Millennials, the biggest factor in making a marijuana purchase is potency. Price comes in at number three, yet another sign that marijuana is inflation resistant (see chart).
Source: New Frontier Data
The report states: “Millennials came of age when cannabis-related social attitudes and policies were changing rapidly. As young adults, they watched the normalization of cannabis use mitigate negative stereotypes, and they have played a leading role in the emergence of the legal cannabis economy, both as participants in the market and as champions for change.”
Millennials are overtaking Baby Boomers as the largest generational cohort of the U.S. population. They were shaped by globalization and the Internet. Polls show that their social attitudes aren’t necessarily “liberal” (as with the activists of the 1960s), but they’re generally tolerant and libertarian. These are positive factors for marijuana’s future growth as a business.
Editor’s Note: Marijuana is among the hottest growth opportunities that you’ll see in your lifetime. If you pick the right pot stock, you could reap stupendous gains. But that’s the key: picking the right stock.
That’s why I urge you to read my new book: The Wide World of Weed and Psychedelics. It’s your definitive guide for making money in the thriving cannabis and psychedelics industries.
Inside the pages of my book, I reveal the stunning facts behind the world of legal marijuana and psychedelics, including the countless ways these substances could alter the very fabric of society, for generations to come. Click here to get your free copy.
John Persinos is the editorial director of Investing Daily.
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