Most Canadian marijuana stocks fizzled last year. CannTrust Holdings (CNTTQ) was in that group, with its stock falling 34%. A handful of Canadian marijuana stocks, though, turned in solid performances in 2018. OrganiGram Holdings (OGI -0.29%) was one of them, jumping more than 10%.

But 2018 is now history. Which of these stocks is the better choice for investors looking to the future? Here's how OrganiGram and CannTrust stack up against each other.

Red Canadian maple leaf surrounded by a pile of marijuana leaves

Image source: Getty Images.

The case for OrganiGram

Pretty much everyone knows that there's a tremendous growth potential for marijuana stocks. The Canadian recreational marijuana market is just beginning to pick up steam. A massive market for cannabis edibles and concentrates could open up in the country later this year. Major countries around the world have legalized medical marijuana, presenting an even greater opportunity.

But why is OrganiGram in a better position than most of its rivals to capitalize on these opportunities? The company's supporters would probably point to several factors. 

OrganiGram's cost structure gives it a competitive advantage. This is especially evident at the company's Moncton, New Brunswick, facility, where a three-tiered growing system maximizes space utilization. Unlike most of its peers, OrganiGram generated profits in 2018.

The company also successfully landed supply agreements with nine of Canada's 10 provinces, leaving only Quebec out of the mix. That's important as the recreational marijuana market heats up this year and beyond. 

OrganiGram hasn't overlooked the international opportunities, though. The company is partnering with Alpha-Cannabis to target the growing German medical marijuana market. It teamed up with CannaTrek Medical in Australia. OrganiGram invested in Eviana, which has a Serbia-based hemp operation.

There's also a wild card of sorts for OrganiGram. The company invested in Hyasynth, a small company that's developing a process for producing cannabinoids using genetically engineered yeast strains. This process could enable the production of high-purity cannabinoids at a fraction of the cost of plant extraction methods. 

The case for CannTrust

Check out the latest CannTrust earnings call transcript.

So why should investors put their hard-earned money on CannTrust? For most of the same reasons touted for OrganiGram.

CannTrust claims a relatively low cost structure, too. Its Niagara facility uses hydroponics for growing cannabis. Instead of soil, the plants grow in liquid solvents loaded with nutrients. 

Like OrganiGram, CannTrust lined up supply agreements with nine Canadian provinces. In addition, the company has an exclusive partnership with Breakthru Beverage Group, Canada's largest alcoholic-beverage broker, for sales support in the Canadian recreational marijuana market.  

CannTrust appears to be in solid shape to reach international medical marijuana markets as well. The company partnered with Apotex, the largest Canadian generic-drug maker, to develop medical cannabis products. It's the only producer to ship cannabis oils to Denmark thus far thanks to its joint venture with Stenocare. CannTrust has other partnerships in place in Australia, Germany, and the Netherlands.

One somewhat unique aspect of CannTrust's business is that the company has entered the veterinary market. CannTrust partnered with Grey Wolf Animal Health to develop cannabis products for pets. 

CannTrust is also recognized in the industry for its quality. The company dominated the 2018 Canadian Cannabis Awards with seven awards, including the top award -- Top Licensed Producer of the Year. 

In addition, CannTrust recently announced that it has applied for a listing on the New York Stock Exchange. This move would make the stock more visible to U.S. investors and could provide momentum for CannTrust's share price in 2019.

Better buy

My view is that OrganiGram and CannTrust rank in the top tier of Canadian marijuana stocks. They both should be able to deliver strong growth and profitability as the Canadian recreational marijuana market and international medical marijuana markets expand.

If I had to pick just one, though, it would be OrganiGram. Although OrganiGram is on track to have slightly higher production capacity, its market cap is less than CannTrust's is. I think this gives OrganiGram the edge in bang for the buck.