Marijuana stocks aren't all alike. MedMen Enterprises Inc. (MMNF.Q) and CannTrust Holdings Inc. (CNTTQ) prove the point. Their business models are very different. MedMen is a U.S.-based company, while CannTrust is headquartered in Canada.

So far this year, CannTrust has turned in a better stock performance than MedMen has. But which of these two marijuana stocks is the better pick for investors now? Here's how MedMen and CannTrust stack up against each other.

Plastic bottle with cannabis spilling out next to U.S. $20 bills.

Image source: Getty Images.

The case for MedMen

MedMen Enterprises is the leading marijuana retailer in the U.S. It currently operates dispensaries in California, Nevada, and New York. But in MedMen's own words, the company doesn't "run pot shops." Instead, MedMen manages "class-leading retail stores that happen to sell marijuana and marijuana products."

Is that just spin? No. In its most recent quarter, MedMen reported revenue per square foot of $6,541 at its seven cannabis stores operating in California. That figure tops the best retailers in the world, including Apple and Tiffany & Co. MedMen also generates roughly three times more revenue than the average marijuana dispensary in California. 

This impressive performance stems from a focus on the details. In particular, MedMen carefully selects its retail locations. The company's California stores are based in strategic markets such as Beverly Hills, Venice Beach, and the LAX airport. MedMen recently opened its first branded store in Las Vegas near the major casinos. It's also relocating an existing dispensary to near the city's main airport.

It's still very early for recreational marijuana sales in California and Nevada. But research firms Arcview Market Research and BDS Analytics project that total cannabis sales in California will increase to $7.7 billion by 2022. While California is the largest marijuana market in the U.S., Nevada is also expected to become a significant market, with annual cannabis sales of more than $650 million within the next four years.

MedMen won't just benefit from growth in the states where it currently operates. The company plans to open marijuana retail stores in Florida and Massachusetts, both of which should claim annual cannabis markets of at least $1.2 billion by 2022. In addition, MedMen has partnered with Cronos Group to launch retail cannabis stores in Canada when legally allowed to do so.

The case for CannTrust

CannTrust Holdings is probably more in line with what you envision when you think of marijuana stocks. The company operates two cannabis production facilities in Canada, one in Vaughan, Ontario, and another larger facility in Niagara. CannTrust is a licensed producer and distributor of medical cannabis in Canada.

The company's immediate growth opportunity lies in Canada's recreational cannabis market, scheduled to open in October. CannTrust is ramping up its capacity in anticipation of high demand. A 600,000-square-foot expansion is currently under way. When completed, CannTrust's annual production capacity should top 100,000 kilograms.

Cannabis-infused beverages and edibles won't be allowed this year but could be another big opportunity for CannTrust in 2019. The company owns a cannabis extraction process that it thinks will be ideal for mixing cannabis compounds with beverages and edibles.

CannTrust also hopes to increase its international sales. The company teamed up with Denmark-based Stenocare to build a cannabis production facility to serve the European medical cannabis market. CannTrust is also establishing distribution partnerships in Germany and Mexico in addition to already exporting medical cannabis to Australia.

There's also another medical cannabis play for CannTrust -- in animals. The company is developing cannabis-based animal health products with Grey Wolf Animal Health. CannTrust and Grey Wolf expect the first products from their collaboration to launch in the fourth quarter of 2018.

Better marijuana stock

Both MedMen and CannTrust have significant opportunities for growth. I think, though, that MedMen could have better long-term prospects.

My biggest reason for choosing MedMen is that the U.S. market is much larger than Canada's. MedMen should be able to replicate its success in California in other states. And as more states legalize recreational marijuana, the company's opportunities will grow even larger. I also expect MedMen's partnership with Cronos Group will be a profitable one. 

But while MedMen gets the nod over CannTrust in my view, I'm still hesitant to call the stock as a buy. An enormous amount of growth is already reflected in MedMen's valuation. I'd like to see the company get more stores up and running in additional states. For now, I think that MedMen is a marijuana stock to keep on your radar.