Cannabis Investing – Without Actually Investing in Cannabis
What is involved in the process of cultivating cannabis? There are many other things you need to consider when looking at investments in this industry. With hydroponics, there are other things to consider such as grow-light technology, fertilizers/nutrients and ventilation systems, just to name a few.
Scott’s Miracle-Gro Company (NYSE: SMG) has been investing heavily in their hydroponics business, which is clearly to tap into the cannabis space. Similar providers are benefiting from the growing industry, without the direct risk of handling cannabis products. Solis Tek is one of these, with a stable business that has remained quiet with the markets despite increasing sales and lean costs.
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Remember that the cannabis industry is not just about growing and selling flower or “bud” – there is much more to consider when looking at investing in this space.
“To be precise, SMG has poured upwards of $500 million into Hawthorne since its inception in 2014. Five of their last six acquisitions have been companies in the hydroponics vertical; in growing mediums, nutrients, lighting, and systems.
Their apparent goal would seem to position them for a strong hydroponics push, both retail and enterprise-facing. The company clearly believes Hawthorne will be a key long-term component of its business. Scott’s is simply buying potential growth, and already Hawthorne makes up 13% of its $2.8 billion top-line.
That should be no surprise to anyone following the burgeoning cannabis industry in North America.”