The high-flying cannabis sector is full of insurgent micro caps, mid caps with prospects running the gamut from poor to excellent, and an assortment of big caps with an appetite for acquisition, driving a lucrative, "full-speed ahead" consolidation trend.
Last week, I showed you exactly how to read these firms' earnings reports, to find the very best of everything the legal weed sector has on offer. (Of course, you could always click here and learn how to access our restricted research; let us do the legwork.)
But there's another, even bigger weight class in the business - one where it still pays to heed the traditional metrics, the "old school" rules of valuation...
Call them the "green blue chips," big companies with a presence outside the sector, but which boast management with the vision to see the truckloads of profits possible in cannabis.
I've done the research to pick one of the very best of these firms to recommend to you today: a big, rich player that's only going to get bigger and richer.
It'll do the same for you.
If there's only one cannabis company you own all the way through your retirement, THIS is it...
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This Big "Beer Baron" Has Designs on Cannabis
I'm talking about Constellation Brands Inc. (NYSE: STZ), a $6 billion Fortune 500 company that's the largest beer importer by sales, with the third-largest market share among beer suppliers.
It has a dominant position in alcohol, and now it's in cannabis at a 45-degree angle.
THREE STOCKS: Any one of these cannabis companies could potentially deliver a 1,000% windfall. Click here to learn more...
I'm extremely excited for the future and the profits that will start to stream in for shareholders...
As you know by now, I keep reinforcing that branding is an important part of running any successful company.
And sometimes that means going back to the drawing board, looking at what sells and what doesn't, and cutting your losses to become more focused.
That's why Constellation is selling 30 brands from its wine and spirits portfolio to E & J Gallo Winery for $1.7 billion.
Now, Constellation will focus on selling high-end wine - in addition to its beer portfolio - which has more growth opportunities.
As I said back in January, I've been a fan of this beer and wine company for a long time. Constellation is the best at managing product brands, and it is continuously adjusting its portfolio in anticipation of changing consumer tastes.
In other words, it never takes its eye off the ball.
I also told you back in January to be prepared for Constellation to start focusing on premium-priced offerings.
Cannabis companies are also utilizing this strategy. Instead of trying to appeal to everyone with a mid-tier product, some cannabis firms are either offering the cheapest products or charging a premium for high-end luxury lines.
So for its core business, getting sleeker and more efficient at reaching a specific customer segment is good news.
And when we turn to Constellation's investment in Canopy Growth Corp. (NYSE: CGC), things get even better...
Constellation, Canopy, & Cannabis
Constellation owns a 37% stake in Canopy, and I'm here to tell you that not only is Constellation Brands now a cannabis company - it's now a cannabis company I think every investor needs in their portfolio, point blank.
Make no mistake, this is not a stock to pass up or trade.
STAKE YOUR CLAIM: Three pot stocks in particular could be poised for rare, wild gains of up to 1,000%. Click here to learn how you could see a $2 million "pot payday"...
It's a stock to buy more and more of when your wealth increases, and when you see the stock price dip, it's great to build an even bigger position.
It currently pays a dividend of $2.96, which is a yield of 1.6%. If you enter that into a dividend reinvestment program (DRIP), then you can accumulate more shares without having to pay a dime.
And an interesting note on Constellation's dividend - it plans to increase its payout by a penny.
Now, that may not sound exciting at first, but it shows that the company is looking ahead, and current shareholders will be thankful down the road. In order to be a "dividend aristocrat," a company must have a minimum of one dividend increase annually for at least the last 25 years.
That's what Constellation is focusing on with this move.
Being on that list carries a lot of weight with risk-averse investors, and that means even more money will flow into Constellation down the road.
Constellation just started paying a dividend in 2015, so it'll be a while before it hits true "aristocrat" status. However, if you own the stock now, you're going to look really smart in the long haul.
Also remember that with its partnership with Canopy, Constellation now has the potential to add a new line of products to its current lineup. It has the first-mover advantage in marijuana beverages just as the market takes off.
All of which proves to me that this stock has a big future.
These 3 Stocks Are the Key to 2019's Greatest Profits
The 2018 midterm election was a turning point for the cannabis industry.
We expect nothing short of historic profits by the end of the year.
But not all pot stocks will hand you life-changing wins. In fact, often the companies making headlines are least likely to see the biggest gains.
These three stocks, on the other hand, are flying under the radar... for now. Each of them could see exponential stock price acceleration at any moment, and if you get in before that happens, you could turn a token stake into a lifetime of wealth.
I don't know of any other sector providing anywhere near this level of growth now.
About the Author
Greg Miller started working on Wall Street in September, 1987, just a month before the “Black Monday” stock market crash.
During his career there, he became an expert in just about every kind of publicly traded security - from blue-chip and small-cap stocks to municipals, junk bonds, and derivatives. As a portfolio manager, Greg was responsible for over $500 million of assets in mutual funds and insurance company accounts.
After leaving the Street, he designed a successful options trading strategy and made lucrative tech investments for a financial publication. He has also helped develop new products and worked with other editors to hone their strategies. He’s always been dedicated to deep, fundamental research - and he always will be - because he believes buying the very best companies at the right price is the best way to amass wealth in the stock market.