After a dismal 2019, cannabis investors were treated to a special New Year’s Day surprise. On January 1, Illinois became the 11th American state to pass legislation regarding recreational cannabis legalization.
Interestingly, Illinois is the first state to pass legalization through its legislature. All previous states legalized cannabis through a referendum of the citizenry. Illinois’s decision to pass official legislation creates an immediate framework for the cannabis community to follow. It also points to the growing acceptance of cannabis legalization among lawmakers.
“This is for all the people who still don’t believe in the cannabis sector,” says Rich. “I don’t know what else we need to do. We keep opening up states [for cannabis legalization]. We keep growing this industry.”
The Illinois Market
Illinois is the sixth most populous state in the US. More than 12.7 million Americans call it home, many of whom live in Chicago, the nation’s third-biggest city.
While its size makes this market an immediately attractive one, Illinois’s progressive attitude towards cannabis legalization is also an attraction. The state allowed existing medical cannabis growers and dispensaries to sell to the public.
Because of this, Illinois generated approximately $3.1 million in sales on January 1 alone. Furthermore, according to the legislation it passed, the state is obligated to begin accepting and processing licenses on March 15 and issuing them by May 1. This will build the cannabis community in Illinois quickly and efficiently.
Which Pot Stocks are Positioned in Illinois?
Many of the biggest pot companies will try to break into this large, newfound market.
One particularly well-positioned cannabis stock in Illinois is Curaleaf Holdings Inc. (CSE:CURA) (OTCQX:CURLF). Last summer, Curaleaf spent $875 million to acquire dispensary operator Grassroots. Not only did this supposedly create the world’s largest cannabis company, but it also positioned Curaleaf in a number of new markets.
Relatively large for a multi-state dispensary network, Grassroots has four stores in Illinois. On top of that, another four are waiting for the state to begin issuing new licenses.
Since cannabis legalization swept Illinois, CURA stock has remained relatively stable at $8.00.
Another company with a foothold in Illinois is Green Thumb Industries Inc. (CSE:GTII) (OTCQX:GTBIF). GTI has six open stores in the state, which currently offer sales to customers with a valid Illinois medical marijuana card. Several of these stores will begin offering recreational cannabis as soon as the requisite permits are in place.
In fact, its forthcoming dispensary—Rise Joliet—will become the first adult-use only store in the state.
Over the last two weeks, GTI shares have gained 16% on the news from Illinois.
Which States Will Be Next to Pass Cannabis Legalization
Some analysts peg New Jersey as the state most likely to adopt legalization next. In November, state citizens will vote on a constitutional amendment to legalize adult-use pot.
According to a Gallup poll, New Jersey is within reach of passing cannabis legalization. Regulators in the state are also in favor of legalizing the drug and have agreed upon an appropriate tax.
Additionally, Arizona and Nebraska are considered likely candidates for legalization in the near future.
Rich remains optimistic about the future of the cannabis space. Are you? If you liked this article, be sure to check out Rich’s opinion of the SAFE Banking Act, as well as his take on a US-focused decriminalization report.
Featured image: DepositPhotos © gustavofrazao