Benzinga - by Maureen Meehan, Benzinga Editor.
News of possible cannabis rescheduling from its onerous position as a Schedule 1 drug on the federal government's Controlled Substance Act has sent sparks into the cannabis community at large as some of the industry's most important weed stocks enjoy a much-needed boost.
What Happened: Doug Kass, world-renowned hedge fund manager, posted on X, formerly Twitter, Friday that the “DEA will approve a rescheduling of cannabis to Schedule III.”
"We have learned yesterday that the U.S. Drug Enforcement Administration will shortly approve a rescheduling of cannabis to Schedule III," Kass said in part of his first tweet on the subject Friday. He advised selling a gap higher in cannabis stocks as a result of the rumored development.
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Cannabis stocks loved the sound of this news and took a significant upward ride on Friday. Here is here is where they stand at midday:
- Curaleaf Holdings (OTCQX:CURLF) was up 13.67% selling at $4.63
- Canopy Growth (NASDAQ:CGC) was up 4.69% at $2.90
- Aurora Cannabis (NASDAQ:ACB) up 4.45% at $3.0187
- Urban-gro (NASDAQ:UGRO) up 5.50% to $2.11
- Tilray Brands (NASDAQ:TLRY) is up 2.08% at $1.63 per share
- Green Thumb Industries (OTCQX:GTBIF) up 6.74% to $12.35 per share
- Village Farms Intl (NASDAQ:VFF) is up 8.04% to $0.7454 per share
What Else? This shift could also translate to lower taxes for cannabis companies that are now burdened by IRS tax code 280E which forbids them from deducting ordinary business expenses. In 2022, cannabis businesses paid $1.8 billion in additional federal taxes, according to market research firm Whitney Economics. For retailers, their tax rates can exceed 70%, the report stated. A change in this area could lead to more competitive prices for consumers.
Meanwhile, AdvisorShares Pure US Cannabis ETF MSOS is still chugging up over 8% at $8.38 at the time of this update, mid-morning Friday and issued a stock alert, which investors will want to keep an eye on:
$AYRWF @AYRWellness $CURLF @Curaleaf_Inc $GTBIF @GTIGrows $TCNNF @Trulieve $GLASF @GlassHouseBR is one of the LONG positions in the $MSOS AdvisorShares Pure US Cannabis #ETF #growers #cultivators #dispensary #msogang #stocksonthemove #investing #cannabiscommunity #stocks… pic.twitter.com/7lK66diZzd— AdvisorShares (@AdvisorShares) March 15, 2024
This is an ongoing story so stay tuned!
The Benzinga Cannabis Capital Conference is being held at The Diplomat Beach Resort and will be a chance for entrepreneurs, both large and small, to network, learn, and grow. Renowned for its trendsetting abilities and influence on the future of cannabis, mark your calendars – this conference is the go-to event of the year for the cannabis world. Get your tickets now on bzcannabis.com – Prices will increase very soon!
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