In the quest to alter cannabis laws in the country, the House has not been much of an issue. The challenge has always been the U.S. Senate.

Last week, however, Senate Majority Leader Chuck Schumer announced his proposed law to decriminalize marijuana and make it legal at the federal level that he wishes to bring to the Senate.

With the possibility of complete federal cannabis legalization on the way, is it time to buy up a lot of marijuana stocks?

Possible winners

As you may expect, there are many winners if marijuana is made legal at the federal level in this country Canadian cannabis producers have long wanted to go into the huge American market. But they can’t do this and still list their shares on top United States stock exchanges while cannabis stays illegal.

If this roadblock is overcome, Canopy Growth is a stand out as an especially good beneficiary. Canopy already has an option to buy U.S. cannabis company Acreage Holdings. It also has a big partner (and biggest shareholder) based in the States — Constellation Brands. Canopy might be the first to move into the American market if Senator Schumer’s bill succeeds.

Also don’t overlook the opportunities for the companies that are already operating in the country, though. Cresco Labs, for example, is ranked as one of the best valued multistate cannabis companies. One reason why its stock is cheap when compared to Canadian pot stocks is they can’t list their shares on a top U.S. stock exchange.

It’s a similar issue for Trulieve Cannabis, one of the largest cannabis operators in the united states. If Trulieve were priced the same price-to-sales ratio that Canopy Growth is at, its cap would bet at $10.3 billion — a lot more than its current number of $6 billion.

Don’t jump in just yet

With so much uncertainty in the U.S. Senate, investors probably should not load up just yet. That does not mean, however, that there are not stocks that you should take a hard look at.

One cannabis stock that looks like a good choice regardless of what happens in D.C. is Cresco Labs. They company is expanding in its core areas. It has also gone into new states, including the huge market of Florida and Ohio.

Author: Steven Sinclaire

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