Down 20%: Plummeting Pot Stock Scandal

Is this crashing cannabinoid stock an isolated incident, or a warning sign to investors in marijuana stocks, in general?

Dave Williamson
Dave Williamson and Michael Douglass
Apr 3, 2014 at 8:40PM
Health Care

For investors continuing to search for a dominant player to invest in to get early exposure to the nascent marijuana industry in the U.S., today's crash for Cannavest (NASDAQOTH:CVSI) may serve as a sobering reminder that this is still an extremely difficult area to invest in. The company, which is more a cannabinoid-based biotech rather than an actual marijuana stock, is watching shares plummet 20% today after disclosing that its last three quarterly reports had material errors. This has been a particularly rough period for Cannavest, which has lost more than 75% of its value in the past month.

In this video, Motley Fool health-care analysts David Williamson and Michael Douglass discuss Cannavest and marijuana stocks, and why they still represent an extremely risky play on the market today.