Cannabis stocks are flying high after voters in New Jersey, Arizona and three other states cleared the way for expanding legal sales of marijuana.
Shares in some of the biggest cannabis companies, including Aurora Cannabis (ACB), Canopy Growth (CGC) and Cresco Labs (CRLBF), are up between 24% and 75% so far this month. By comparison, the benchmark S&P 500 index is up 11%.
Investors are encouraged because the successful ballot initiatives broaden the potential market for legal cannabis sales and show marijuana is becoming increasingly more accepted throughout the U.S.
The stocks began rallying after Election Day. Voters in New Jersey, Arizona, Montana and South Dakota approved legalizing sales of marijuana for adults. South Dakota also approved sales for medical use, as did Mississippi.
The expansion of sales to adults alone represents a nearly 20% increase in the potential U.S. market for legal cannabis, according to industry tracker BDSA.
“That continues to open up new markets for these legal U.S. cannabis companies,” said Morningstar analyst Kristoffer Inton. “That supports a really robust U.S. market growth.”
All told, cannabis is now legal for adults in 15 states and the District of Columbia. Thirty-six states allow for some form of access for medicinal use.
The successful state ballot initiatives have prompted analysts to revise…