These Cannabis Heavyweights Are Battling It Out over the "Marijuana Mecca of the Midwest"

Early last month I wrote about how Illinois is primed to become the "Marijuana Mecca of the Midwest," and it seems that we're not the only ones who know about it.

Now that shareholders have approved the landmark agreement for Acreage Holdings Inc. to be acquired by Canadian giant Canopy Growth Corp., Acreage is on the move.

After the deal closed on Thursday, Acreage CEO Kevin Murphy gave an interview at the Players Technology Summit in San Francisco in which he hinted at a number of "head-turner" acquisitions that the company has in the works.

While he was careful not to spill any specifics, he did make one thing clear.

Illinois, which last month became the first state to approve the sale of adult-use cannabis through legislation, will feature prominently in Acreage's plans. When asked about the coming market, Murphy said: "We have designs on going very deep and very broad in that state."

It will be especially interesting to see whether the company makes any moves to benefit from the potential for districts to opt in on "social consumption lounges" – something we thought might happen in Las Vegas, but it will be much more likely in Illinois.

However, when Acreage tries to enter "The Land of Lincoln," it's going to encounter a buzz saw.

We're tracking a couple companies in our portfolios who are already in the state, and they're going to give Acreage more than a hard time.

Let's take a look at some of the companies Acreage is going up against...

Trading Strategies

The Dollar Value of the U.S. Weed Market Is Already Huge

The marijuana market as a whole is a lot like the Grand Canyon – it looks fantastic up close, but from a distance, it's absolutely breathtaking.

Last year, total marijuana sales – legal and black market – in the United States topped $86 billion. In 2018, all across the country, nearly 49 million people spent an average of $1,755 each on marijuana.

The thing is, some $68 billion of that was from totally illegal black market sales.

But that still leaves us with around $18 billion in legal transactions. For comparison, that's about the size of the U.S. urgent care healthcare segment in 2018.

So the "$68 billion question," as it were, is how quickly that "legal gap" will close and start putting mega-profits in pot stock investors' pockets.

The short answer: much faster than anyone out there is predicting. Bringing illicit sales into the legal "light" doesn't require convincing new customers to try something new; no new consumption habits need to be formed.

It's a well-established market, full of folks just waiting to fork over their money.

And they will fork it over by the truckload...

Trading Strategies

Time to Buy the "Microsoft of Weed"

You got rich from Cisco Systems Inc. and JDS Uniphase. You bought shares in the first public incarnation of Dell. You had positions in companies like SDL and Netscape and made a bundle when those companies sold.

There were dozens of outstanding stocks that turned ordinary investors into millionaires or even billionaires. You owned 'em, and you're one of 'em.

Still, there was one that got away… the decade's most successful tech company – one that dominated the market for years as far back as the 1980s.

I mean Microsoft Corp., of course.

No matter how well you did during the PC and technology boom, you'd have done much better if you'd had some Microsoft in your portfolio all the while.

Well, the cannabis sector of 2019 today looks much like that 1990s tech boom.

And this one company is starting to look a lot like Microsoft...