CGC: Stay Away from These 4 Overvalued Marijuana Stocks – StockNews.com

The cannabis industry has a lot of potential and  saw  a splendid stock market bull run in 2020. The past year has seen a significant increase in the consumption of CBD products due to increased stress and anxiety with people being locked in their homes to an almost unprecedented degree. New Frontier Data has predicted that total cannabis sales will  hit$30 billion by 2025 in the 11 U.S. jurisdictions where its usage is legal.

Because the industry has long operated in the face of strong opposition, it has shown a tremendous growth. With the Biden administration at the helm now, widespread legalization of adult-use marijuana is highly anticipated. These developments add to the prospects of the industry’s upside.

However, the industry is still in its nascent stages, and there are many hurdles before it. Most  pot producers are undertaking  growth initiatives, but they lack strong cash positions and profitability to support them. Some producers are also saddled with high debt levels.

But due to the euphoria surrounding marijuana stocks, most of them are currently trading at high prices. But their valuations look stretched because their fundamentals generally do not justify their price levels. Four such overvalued stocks are Canopy Growth

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