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3 Stocks I’ve Bought or Bet Against in November

Whether investors realize it or not, they’re navigating their way through a historic period for the stock market. During the first quarter of 2020, the broad-based S&P 500 saw its quickest plunge of at least 30% in its storied history (it took about a month). This was followed by the strongest bounce back on record, with the S&P 500 taking less than 17 months to double from its pandemic trough on March 23, 2020.

During the coronavirus crash, I deployed pretty much all of my available capital and purchased or added to more than a dozen stocks. But since the S&P 500 hit its trough, my cash balance has been building.

This month, I’ve found a few opportunities to put some of this cash to work. Here are three stocks I’ve added to, bought for the first time, or bet against, in November.

A person writing and circling the word buy beneath a drop in a stock chart.

Image source: Getty Images.

Added to: Jushi Holdings

The first company that had me seeing green in November is marijuana stock Jushi Holdings (OTC:JUSHF). I initially bought into Jushi in August, added to my stake again in September, and made my largest share-based purchase to date in early November.

To clear the air, I’m not in the least bit concerned that Congress hasn’t been able pass cannabis banking or legalization reforms at the federal level. Most U.S. multi-state operators (MSOs) are built in such a way that state-level legalizations provide more than enough growth potential to become wildly profitable. With 36 states having legalized weed in some capacity, there’s plenty of opportunity for pot stocks to thrive in the U.S.

As for Jushi, there are three things I particularly like about the company. First, there’s a focus on limited-license markets. A limited-license market caps how many dispensary licenses regulators issue in total, and often to a single business. In Jushi’s case, it’s targeting three core markets: Pennsylvania, Illinois, and Virginia. The former two are traditional limited-license states, whereas Virginia assigns licenses based on jurisdiction. The point being that Jushi is protected from larger competitors with deeper pockets by this purposeful licensing assignment. This’ll allow the company to successfully build up its brand and gain a healthy following in these potential billion-dollar markets (Illinois already hit $1 billion in pot sales in 2020).

Second, Jushi’s insiders and executives have skin in the game. Of the first $250 million in capital raised by the company, approximately $45 million came from insiders and executives. Generally, when the interests of insiders align with shareholders, good things happen.

And third, Jushi looks to be an absolute steal relative to its peers. With 26 operating dispensaries and 39 total retail licenses in its back pocket, taking into account pending acquisitions,  Jushi offers some of the fastest growth potential in the cannabis space. Sales are expected to catapult from close to $81 million in 2020 to $467 million by 2023, according to Wall Street estimates. What’s more, the company should turn the corner to profitability next year. That’s a bargain for a company carrying a market cap of just $757 million, as of this past weekend.

Multiple rows of clear jars set on a dispensary counter that are packed with unique strains of cannabis buds.

Image source: Getty Images.

Bought for the first time: Columbia Care

Just days before making my third purchase of Jushi Holdings, I made my initial purchase of U.S. cannabis MSO Columbia Care (OTC:CCHWF). That’s right, folks… it’s been a pot-stock-buying sort of month.

Whereas Jushi offers me the opportunity to buy a relatively small MSO building from the ground, Columbia Care gives me the opportunity to take advantage of growth from a larger base. According to the company, it operates 130 facilities, 99 of which are dispensaries.  Keep in mind these figures include facilities that are under development. The roughly 100 retail locations will make Columbia Care one of the biggest marijuana retailers in the country.

One the biggest growth drivers for Columbia Care is the company’s penchant for acquisitions. On the same day I made my initial purchase, Columbia Care announced the completion of its Medicine Man buyout. The $42 million deal bolsters the company’s presence in Colorado, which ranks as the No. 2 market for weed sales in the United States.  Additionally, Columbia Care closed a $240 million buyout of Green Leaf Medical in mid-June. This deal gave the company a sizable presence in the mid-Atlantic region. 

On one hand, an acquisition-heavy strategy exposes Columbia Care to higher upfront costs, integration delays, and potential regulatory snafus — the latter of which has been a problem this year. On the other hand, this strategy is rapidly expanding the company’s reach and should begin paying dividends in 2022. Wall Street is looking for the company’s full-year sales to jump from…

Read More: 3 Stocks I’ve Bought or Bet Against in November

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