Marijuana markets across the world are set to grow by dizzying levels over the next few years. But where in the world will the fastest growth be?

Fortunately, the cannabis industry analysts at Arcview Market Research and BDS Analytics joined forces to answer this question (and plenty more) in the recently published book The State of Legal Marijuana Markets, 6th Edition. Arcview and BDS Analysts developed a cannabis market model that spanned the globe, estimating marijuana sales in 2017 and projecting what sales will be in 2022.

Of course, some marijuana markets will grow tremendously and still be quite small. To keep these from skewing the results, I excluded any market that wouldn't have total marijuana sales by 2022 of at least $500 million. And because the U.S. has by far the biggest marijuana market, I included U.S. states individually while taking the total marijuana market for other countries. With all this said, here are the three fastest-growing marijuana markets in the world -- and the top stocks poised to profit from them.

Marijuana plant in front of a globe.

Image source: Getty Images.

1. Germany

Germany should rank as the fastest-growing marijuana market of all over the next few years. The country legalized medical marijuana in 2017. However, Arcview and BDS Analytics estimate that marijuana sales in Germany last year totaled only around $9 million. By 2022, though, this figure is projected to skyrocket to close to $1.6 billion. That's an astounding increase of 17,678%. 

There are several reasons why Germany takes the top spot. The country claims the largest population in the European Union. It's easily the biggest marijuana market outside of North America. Germany's medical cannabis laws aren't overly restrictive, which means that many patients enjoy relatively easy access. In addition, Germany's major health insurers are required to provide some level of coverage for medical cannabis.

2. Florida

California and Colorado are the biggest marijuana markets in the U.S., with both states allowing the legal use of medical and recreational marijuana. However, Florida is projected to come in third by 2022 with marijuana sales of $1.74 billion despite legalizing only medical marijuana. This would represent an 806% increase over Florida's 2017 marijuana sales of $192 million.

Florida is the third-largest state in the U.S. with a population of more than 21 million. It's also one of the fastest-growing states, trailing only Idaho, Nevada, and Washington. Florida patients can use a wide variety of medical cannabis products with physician approval, including oils, vapes, and edibles.    

3. Canada

It's probably not too surprising that Canada made the list of the three fastest-growing marijuana markets. Last year, total marijuana sales in the country were around $60 million. Arcview Market Research and BDS Analytics estimate the market in Canada will soar 800% by 2022 to roughly $5.4 billion.

The rapid growth, of course, will come from Canada's legalization of recreational marijuana for adult use. This market opens in October 2018. However, cannabis products such as edibles and concentrates used in vaping won't be legally allowed until next year. 

Top stocks for each market

There won't be any domestic production of medical cannabis in Germany until 2019. Canadian marijuana growers have been exporting cannabis to the European country in the meantime. The two largest exporters to Germany at this point appear to be Aurora Cannabis (NASDAQOTH:ACBFF) and Canopy Growth (NYSE:CGC).

What will happen as Germany establishes regulations for domestic cannabis production? I think both Aurora and Canopy will still be leaders in the country. Aurora acquired German medical cannabis company Pedanios in 2017. Canopy acquired Germany-based MedCann in 2016. These acquisitions should put Aurora and Canopy in good shape to compete in the German market for years to come.

Since we're already talking about Aurora and Canopy, it makes sense to jump to the Canadian market next. Both companies are poised to enjoy tremendous sales growth with the opening of the Canadian recreational market. However, I'd put Aphria (NASDAQOTH:APHQF), Cronos Group (NASDAQ:CRON), and Tilray (NASDAQ:TLRY) on the list for top stocks for the Canadian market as well. Each of these three companies could also be major players in Germany alongside Aurora and Canopy.

What about Florida? If you want to stick with marijuana growers, one possibility is iAnthus Capital Holdings (NASDAQOTH:ITHUF). The company holds one of only 13 cannabis licenses in Florida and also has operations in three other states. Its stock ranked as the No. 2 best-performing marijuana stock in the first half of 2018.

MedMen Enterprises (NASDAQOTH:MMNFF) is the top cannabis retailer in California and is also looking to expand into Florida in the near future. The company generates really impressive sales per square foot. MedMen has also partnered with Cronos Group to open retail cannabis stores throughout Canada.

But will the growth be fast enough?

There's one major problem with all of the top stocks mentioned for the fast-growing Germany, Florida, and Canada marijuana markets. The growth in these markets might not be fast enough to justify the inflated market caps for some of these stocks.

The Canadian marijuana stocks, in particular, have sky-high valuations. The biggest three -- Canopy Growth, Tilray, and Aurora Cannabis -- together claim a combined market cap of more than $25 billion. That's more than triple the projected combined size of the marijuana markets in Germany and Canada in 2022. And these companies will have plenty of competition in those markets.

Companies with U.S. operations like iAnthus and MedMen should have even greater growth opportunities because of the size of the U.S. market. However, doing business in the U.S. cannabis industry comes with its own set of risks, notably including the fact that marijuana remains illegal at the federal level. Both iAnthus and MedMen are also valued astronomically based on their current performance.

As is often the case in investing, there's no guarantee that fast-growing markets will generate fast-growing returns -- even for the top stocks. 

Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.