If you thought the stock market has been on a wild ride in 2020, pan out a bit and take a gander at the volatility that marijuana stock investors have contended with over the past couple of years. Through March 2019, you could practically have thrown a dart at a list of cannabis stocks and come out a winner. However, over the past 15 months, most pot stocks have lost half or more of their value.

As is the case with all next big thing investments, the industry needs time to mature. We've witnessed everything from regulatory-based supply and tax issues to financing and overcapacity wreaking havoc on North American pot stocks. The good news, though, is that there is light (and plenty of green) at the end of the tunnel for cannabis stocks.

Perhaps what'll truly vindicate marijuana as a viable investment opportunity is a publicly traded pot stock generating $1 billion in annual sales. While our neighbors to the north have their work cut out to reach this psychological sales plateau, there are three pot stocks focused on the U.S. market that do have the potential to reach $1 billion in annual sales within the next couple of years. The question is, which cannabis stock gets there first?

A tipped over jar packed with cannabis buds lying atop a small pile of cash.

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GW Pharmaceuticals

If the definition of "cannabis stock" includes a company whose entire revenue stream is based on cannabinoid drugs, then drug developer GW Pharmaceuticals (NASDAQ:GWPH) might be the first pot stock to deliver $1 billion in annual sales.

Currently, cannabidiol (CBD)-based Epidiolex is what makes GW Pharmaceuticals tick. Epidiolex is approved by the U.S. Food and Drug Administration as treatment for two rare forms of childhood-onset epilepsy. For a while, GW had the only approved treatment for Dravet syndrome, and easily one of the most popular treatments for Lennox-Gastaut patients. These two indications were responsible for $116.1 million in net sales during the first quarter, which accounted for almost all of GW's $120.6 million in sales. 

GW Pharmaceuticals is also preparing for the label expansion of Epidiolex to include tuberous sclerosis complex, or TSC. This represents yet another pathway to rising sales. According to the company's first-quarter results, the launch in TSC could happen by August.

Assuming Epidiolex continues to wow Wall Street, there's an outside chance GW Pharmaceuticals could hit $1 billion in annual sales as soon as next year.

A large cannabis dispensary sign.

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Curaleaf Holdings

If you're not a fan of counting drug developers among cannabis pure-plays, then the pot stock with the best chance to reach $1 billion in sales first is U.S. multistate operator (MSO) Curaleaf Holdings (OTC:CURL.F).

Among publicly traded U.S. MSO's, there's not a one that has more operational dispensaries than Curaleaf. As of this past week, it had 57 operational dispensaries to go along with 15 cultivation sites and 24 processing centers in 18 total states. As you can imagine, having more operational retail locations gives Curaleaf a leg up on its competition, at least in regard to the race to $1 billion in annual sales. 

But what'll really give Curaleaf a shot at a cool $1 billion in yearly revenue is the expected closing of its Grassroots acquisition. Having already closed a deal with Cura Partners to bring the Select brand of products into its portfolio, Curaleaf's pending acquisition of Grassroots should increase its operational dispensary count past six dozen, as well as give the company licenses to open more than 130 retail stores in legalized states. In sum, acquisitions are going to be a key driver for Curaleaf.

It's also important to note that Curaleaf hasn't had any issue obtaining traditional forms of financing. With its common stock used as collateral for deals, and the company sporting plenty of cash to cover its organic dispensary expansion, financing won't hinder Curaleaf in the same way it's slowed down many of its peers.

Curaleaf appears to be on track to bring in $1 billion in revenue by 2022, with a slight chance of this happening by 2021.

Multiple clear jars filled with unique cannabis buds on a dispensary countertop.

Image source: Getty Images.

Green Thumb Industries

The way I view it, there's really only one MSO other than Curaleaf that could reach the $1 billion annual sales plateau first, and that's Green Thumb Industries (OTC:GTBI.F).

Though Trulieve Cannabis has a few more open dispensaries than Green Thumb, it's pretty much reached its limit in Florida, which'll constrain its revenue growth until recreational weed has an opportunity to be legalized in the Sunshine State in 2022. Meanwhile, Cresco Labs does have access to more than 500 dispensaries in California following its acquisition of Origin House, but has axed other deals that would have broadened its retail reach. That leaves Green Thumb as the logical third candidate.

Currently, Green Thumb has 48 operational dispensaries, but licenses to open as many 96 in a dozen states. The important aspect here is that Green Thumb's dispensaries are in market's that matter. It's been opening a number of locations in Illinois, which began selling adult-use weed on Jan. 1, 2020. Green Thumb also bought its way into Nevada via the Integral Associates deal. Because of Nevada's strong tourism industry, it could easily lead the nation in per-capita cannabis spending within a few years.

But the real key here might just be how successful Green Thumb is in continuing to push higher-priced (and higher-margin) derivative products, such as edibles, concentrates, and vapes. Around two-thirds of the company's sales are derived from these high-margin alternative consumption options, and that could be Green Thumb's ticket to $1 billion in annual sales by 2022.