What happened

It's been a down month for Canadian cannabis stocks like Canopy Growth (CGC 0.42%), Organigram Holdings (OGI), and HEXO (HEXO). These stocks have had several catalysts influencing them with both political and company-specific news. 

Shares are bouncing today, with Canopy Growth up 6.3%, Organigram up 3.5%, and HEXO up 4.8%, as of 11:20 a.m. EST.

So what

There are no new announcements from the companies today. But after shares have dropped between 35% and 50% in just the past month, some recent progress with new product offerings, and legalization expanding among U.S. states, investors are feeling like buying the dip today. 

CGC Chart

CGC data by YCharts

Canopy Growth recently announced its entrance into the U.S. CBD beverage market, and has been growing sponsorship for its majority owned BioSteel sports nutrition brand. Last week, Organigram announced the launch of two new products in its recreational cannabis product portfolio. 

marijuana buds in jars at dispensary

Image source: Getty Images.

Now what

Canopy Growth has a big investor in beverage company Constellation Brands (STZ -0.31%). Constellation has even added to its initial $4 billion investment in the pot company. That partnership helps provide Canopy a distribution framework in the U.S. So when it announced the launch of its Quatreau CBD beverage brand in the U.S. last week, it seemed very complementary. The company calls the Quatreau brand "a premium ready-to-drink CBD-infused sparkling water." Quatreau has grown to become Canada's top-selling ready-to-drink CBD beverage, according to Canopy Growth. 

Canopy also announced last week that NBA star Luka Doncic will join the CBD-based sports nutrition product maker BioSteel with the title of "global chief hydration officer." Canopy purchased a majority stake in BioSteel in 2019. 

These moves into U.S. products set up Canopy in the event that federal marijuana legalization eventually allows the company to participate in that market with THC-based products. Progress on the state level continued when Virginia became the 16th U.S. state to approve marijuana legalization for adult recreational use two weeks ago (adult recreational use is also legal in the District of Columbia). Gov. Ralph Northam still needs to sign the bill, but he supports legalization, which will allow for sales to begin in 2024.

Organigram's new "Jar of Joints" and "Trailblazer SNAX Milk Chocolate Bars" contain THC so are not available in the U.S. at this point. But both Organigram and HEXO would be beneficiaries of any progress toward federal legalization in the U.S. 

Investors watched the stocks correct significantly in the past month, and the potential growth both inside and outside of Canada has some investors taking the opportunity to buy today.