Marijuana stocks don't generate the buzz that they did a few years ago. However, the cannabis industry is still in its early growth phase. As more states and countries legalize medical and recreational marijuana, opportunities continue to expand for growers, retailers, biotech firms, and ancillary businesses. One of the biggest potential catalysts is the U.S. Drug Enforcement Administration's move to reclassify marijuana from Schedule I to Schedule III. If finalized, this could:
- Allow cannabis companies to deduct normal business expenses (ending IRS 280E burdens)
- Improve access to banking services
- Encourage broader institutional investment
Still, cannabis remains federally illegal in the U.S., and regulatory uncertainty creates real risks for investors. Before investing, it's important to understand how the industry works and how to evaluate marijuana stocks.
Five top marijuana stocks for 2026
1. Green Thumb Industries
OTC: GTBIF
Key Data Points
OTC: TCNNF
Key Data Points
NYSE: IIPR
Key Data Points
NYSE: DGX
Key Data Points
Quest Diagnostics (DGX -1.81%) might be a surprising pick for a list of marijuana stocks, as it's one of the world's largest providers of laboratory testing services.
How does Quest tie in with the cannabis industry? The widespread legalization of marijuana in states across the U.S. is driving increasing demand for drug testing in the workplace. Quest offers drug testing services and is certified by the U.S. Department of Health and Human Services for federally mandated drug testing of workers in some safety-sensitive fields.
Quest could be an attractive stock for more risk-averse investors looking to profit from the legalization of cannabis. The company has a long track record of success and is consistently profitable.
5. Turning Point Brands
Benefits and risks of investing in marijuana stocks
The benefits of investing in marijuana stocks include:
- Potential for near-term appreciation once rescheduling is finalized.
- Significant long-term growth potential.
- Merger and acquisition opportunities as the cannabis market consolidates.
However, there are also risks of investing in marijuana stocks, including:
- Cannabis remains illegal at the federal level in the U.S.
- Significant volatility.
- Competition from unregulated marijuana.
Should you invest in marijuana stocks?
Just because there's a trendy new sector with lots of press and potential growth doesn't mean you need to invest in it. Conservative investors who prefer lower risk are likely better off avoiding investing in marijuana stocks or choosing a marijuana ETF instead.
However, aggressive investors with high risk tolerances will probably find a lot to like about marijuana stocks. The cannabis industry is still in its early stages. The market opportunities are enormous, especially as more U.S. states legalize cannabis. Investing in these stocks is a high-risk but potentially high-reward proposition.
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FAQ
Investing in Marijuana Stocks FAQ
About the Author
Keith Speights has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Quest Diagnostics. The Motley Fool recommends Green Thumb Industries, Innovative Industrial Properties, and Turning Point Brands. The Motley Fool has a disclosure policy.
