If you're just taking a quick glance at charts of Medical Marijuana Inc. (OTCMKTS:MJNA) and Cannabis Science Inc. (OTCMKTS:CBIS), it would be easy to conclude that the once-hot marijuana trade has already burned itself out. Shares of CBIS and MJNA are both struggling, with Cannabis Science shares back under their 200-day moving average line. Medical Marijuana shares are getting close to doing the same. These two stocks don't speak for the whole industry - and its opportunities - though. There's a company called Growlife Inc. (OTCBB:PHOT) in the mix, and unlike many of its peers, PHOT has a clear and dependable future.
While medical marijuana has been legal in at least a few states for years, the number of states where it's now legal for medicinal purposes is large enough for it to be considered more than a cottage industry. As of the last look (and the last election in November), nineteen states allow use of marijuana for medical reasons. Also as of November, two of those nineteen them allow marijuana to be grown and used for recreational purposes. While it's still not a majority of the nation's states, that's tremendous progress for the industry. And, given the nation's underlying attitude towards marijuana as of this year - more than half the populous now finally believes in and supports the usage of marijuana - it's likely the number of states where it's legal for at least one reason will start to accelerate.
Growlife Inc. is positioning to capitalize not just on the current trend where it's legal in nineteen states, but when it inevitably becomes legal in many more states.
That's not to say Cannabis Science Inc. and Medical Marijuana Inc. don't have a future. But, PHOT is already a standout within the industry.
For starters, Growlife is led more like a Fortune 500 company and less like a side project being run out of someone's garage. The CEO, Sterling Scott, was formerly a Federal regulatory attorney. He's also been in private practice, which included M&A work. Translation: Scott's got plenty of experience, and is not only well suited to lead PHOT through more successful acquisitions [the company has made or is working on three within the last year], but he clearly is skilled enough to navigate the regularity hurdles that will pop up as more and more states vote on legalization.
Second, while there's a lot to be said for focusing on doing one thing exceedingly well, the management team know that the marijuana industry is one that's best capitalized on be being an all-encompassing solutions provider. That's why Growlife has made a point of acquiring similar and supportive companies, like Stealth Grow, Urban Garden, and Greners.com. Between its existing entities and new ones, PHOT can supply a new grower with everything he or she needs, can plan special marijuana-based events, and establish a website that caters specifically to people interested in this growing arena (consumers as well as vendors).
Or said another way, Growlife Inc. is being treated like a real business.
As for the future, that remains to be seen - PHOT is growing (organically as well as by acquisition) too quickly to pin down. The projected top line for 2013 is around $4 million, versus a market cap of $13.9 million. But, Growlife is very, very good at finding cost-effective, accretive, and complementary acquisitions. It's very likely the market is underestimating Growlife at the stock's current price of $0.042.
Bottom line? While there are several publicly-traded names in the marijuana space, including Cannabis Science and Medical Marijuana, there's just something more encouraging about Growlife Inc.
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