With Congress passing the funding bill on Wednesday, ending the record-long government shutdown, a controversial provision has made its way into the bill’s provisions, one that is sparking alarm across the hemp and cannabis industry. Move To Re-Criminalize Hemp-Derived ProductsA last-minute provision in the funding package that the Senate passed on Monday comes with a surprise catch: the criminalization of several THC-infused and hemp-derived products across the country, which were legalized as part of the ...

Core Insights - The marijuana industry is experiencing volatility, with potential for improved trading levels driven by legal reforms and earnings reports [1][2][3] Industry Overview - There is ongoing speculation regarding the legalization or rescheduling of cannabis, which influences trading dynamics [2] - The push for more legal states and the end of cannabis prohibition in the U.S. has positively impacted marijuana stocks over the past five years [1] Company Highlights - **WM Technology, Inc.**: An online cannabis marketplace that provides e-commerce and compliance software solutions. The company is set to release its Q3 2025 results on November 6, 2025 [4] - **Hydrofarm Holdings Group, Inc.**: Manufactures and distributes hydroponics equipment for controlled environment agriculture in the U.S. and Canada. Recently, the company made changes to its board of directors [5][7] - **GrowGeneration Corp.**: Operates retail hydroponic and organic gardening stores in the U.S. The company recently launched a new product aimed at improving cannabis flower development [8][10] Investment Opportunities - Companies like WM Technology, Hydrofarm, and GrowGeneration are identified as potential stocks to watch for better trading outcomes, especially as they prepare to report earnings [3][6]

Core Insights - Marijuana Exchange-Traded Funds (ETFs) have seen a significant resurgence, with some increasing over 100% in the past three months after a poor performance in 2024, driven by the U.S. administration's push for marijuana legalization [1][4] Market Performance - The cannabis market faced heavy losses in 2024 due to regulatory challenges and high tax burdens under IRS code 280E, despite a strong demand trend [2] - Market oversupply and competition from lower-priced illicit products led to disappointing quarterly results, causing major ETFs like AdvisorShares Pure US Cannabis ETF (MSOS) and Amplify Seymour Cannabis ETF (CNBS) to decline over 45% last year [3] Regulatory Changes - A shift in outlook began in July 2025 when news surfaced about the potential rescheduling of cannabis from Schedule I to Schedule III, which could ease tax burdens and promote scientific research [4] - Recent political support from President Trump for marijuana legalization has further fueled investor optimism regarding federal cannabis policy changes [4] ETF Performance - **AdvisorShares Pure US Cannabis ETF (MSOS)**: Experienced a 45.6% loss in 2024 but surged 114.5% in the past three months, with top holdings including Curaleaf Holdings (24.01%), Trulieve Cannabis (22.17%), and Green Thumb Industries (20.68%) [6] - **Amplify Seymour Cannabis ETF (CNBS)**: Plummeted 52% in 2024 but rebounded with a 102.1% increase in the last three months, holding Trulieve Cannabis (16.07%), Green Thumb Industries (14.06%), and Curaleaf Holdings (12.31%) [7] - **Roundhill Cannabis ETF (WEED)**: Declined 44.9% in 2024 but surged 120.2% recently, with top holdings including Curaleaf Holdings (28.85%), Green Thumb Industries (28.18%), and Trulieve Cannabis (25.54%) [8] - **Amplify Alternative Harvest ETF (MJ)**: Fell 30.7% in 2024 but increased by 96.3% in the past three months, with major holdings in Amplify Seymour Cannabis ETF (49.30%) and Tilray Brands (21.11%) [9] - **AdvisorShares Pure Cannabis ETF (YOLO)**: Lost 19.9% in 2024 but surged 79.3% recently, with top holdings including AdvisorShares Pure US Cannabis ETF (42.75%) and Village Farms International (16.04%) [10]

Core Insights - Cannabis stocks experienced a significant surge following Donald Trump's video promoting cannabis use for seniors and Medicaid coverage for CBD products [1][2] - The video, produced by the Commonwealth Project, highlights the potential benefits of hemp-derived CBD as a pain and stress reliever for seniors [1][2] - The cannabis industry is advocating for federal decriminalization to enhance research investment and broaden access to medical cannabis [6] Industry Impact - Stocks for major cannabis companies, including Canopy Growth, Tilray, and Cronos Group, saw substantial increases, with Tilray rising over 40% after the video release [2][6] - The AdvisorShares Cannabis ETF (MSOS) also experienced a notable rise on the same day [2] - The video emphasizes the need for educating healthcare providers and providing Medicare coverage for CBD, which could significantly impact the market [3] Regulatory Context - Under the Biden administration, there have been requests to the DEA to reclassify cannabis as a lower-risk substance, which is currently classified as Schedule I [4][5] - The Trump administration had previously been silent on cannabis decriminalization but indicated a willingness to consider reclassification [5] - Currently, 40 states permit medical cannabis use, while 24 states allow non-medical use, indicating a growing acceptance at the state level [5] Challenges and Opportunities - The Commonwealth Project notes that the current Schedule I classification complicates research and integration of cannabis into medical care, limiting access for seniors [7] - There is uncertainty regarding the stance of Terrance Cole, Trump's DEA administrator, on cannabis reclassification, as his focus has been on other priorities [7]

Industry Overview - The Canadian cannabis sector is a focal point for investors as it continues to evolve with expanding operations and long-term growth strategies [1][3] - The U.S. cannabis industry has surpassed $33 billion in annual sales, with projections exceeding $50 billion by 2030, indicating significant global opportunities for Canadian companies [1] - Recent developments in U.S. legalization discussions, including potential federal rescheduling of cannabis, could enhance banking access and reduce tax burdens, fostering optimism for both U.S. and Canadian firms [1][2] Company Summaries Cronos Group (CRON) - Cronos Group focuses on research, development, and global distribution, emphasizing branded products and international medical cannabis opportunities rather than a large U.S. dispensary network [4][7] - The company reported revenue of approximately CAD $33.5 million, a 20% year-over-year increase, but also a net loss of about CAD $38.5 million due to foreign-exchange headwinds and investment costs [7] - Cronos has improved gross margins and maintains a strong liquidity position, allowing for strategic flexibility and potential growth in global medical markets [7] SNDL Inc. (SNDL) - SNDL has established one of the largest retail footprints in Canada, operating over 180 retail locations under various banners, while also pursuing investments in the U.S. market [8][10] - The company reported net revenue of approximately CAD $244.8 million, with a gross profit increase of over 16% and positive operating income of around CAD $5 million for the first time in several years [10] - SNDL's strong cash position of over CAD $200 million and no debt on its balance sheet provide financial stability, while its strategy focuses on expanding its retail network and preparing for cross-border opportunities [10] Aurora Cannabis (ACB) - Aurora Cannabis emphasizes medical cannabis exports and global distribution, serving regulated medical markets in Europe and Australia, while shifting away from low-margin recreational cannabis [11][13] - The company reported total net revenue of about CAD $81 million, reflecting nearly 30% growth year-over-year, with medical cannabis sales increasing over 40% to more than CAD $61 million [13] - Aurora's adjusted gross margins improved to roughly 54%, showcasing higher profitability from its medical and international operations, despite challenges from regulatory shifts and competition [13] Investment Considerations - Investors should monitor the financial performance, operational strategies, and regulatory changes affecting Cronos Group, SNDL, and Aurora Cannabis, as each company presents unique opportunities and risks in the evolving cannabis landscape [14]

Core Insights - The prospects for marijuana legalization in the U.S. are facing setbacks due to opposition from influential legislators, negatively impacting cannabis stocks like Curaleaf [1][4] - President Trump is considering a measure to reschedule marijuana, which could lead to its de facto legalization at the federal level [2] - A group of nine Congress members, led by Congressman Pete Sessions, is actively opposing the rescheduling of marijuana, citing concerns over its impact on children and potential benefits to the marijuana industry [3][4] Industry Sentiment - The sentiment in the cannabis industry is currently negative, as evidenced by the decline in Curaleaf's stock price, which fell over 2% on a day when the S&P 500 only dropped 0.6% [1] - The ongoing debate and legislative pushback create uncertainty for cannabis operators, hindering their growth and access to financial services [4] Legislative Developments - The proposed rescheduling of marijuana by the DEA could eliminate its classification as a harmful drug, which is supported by public opinion but faces significant legislative opposition [2][3] - The letter sent to President Trump by Congress members highlights the political divide on marijuana legalization and the potential implications for the industry [3][4]