Schaeffer's State-by-State Cannabis Legalization Update

Legalization efforts have a profound impact on cannabis stocks

CMT, Senior Market Strategist
Oct 28, 2021 at 2:42 PM
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    On Thursday, October 14, Schaeffer's Investment Research's Senior Market Strategist Matthew Timpane, CMT, was a featured presenter at the Benzinga Cannabis Capital Conference. Timpane kicked off the presentation with a comprehensive breakdown of legalization movement for medicinal and recreational marijuana in 2021. Legalization efforts have had a profound impact on the growth of the cannabis industry.

    Patrick Lane (Benzinga)
    All right, my friends. Next up, and let's go ahead and bring him over is Matt Timpane, a market strategist over at Schaeffer's Investment Research - one of my favorite firms where I go to look at stocks, the research, everything I need, all the trade ideas I could possibly want... I go to Matt and team over there. Matt, how are you, man?
     
    Matthew Timpane CMT (Schaeffer's Investment Research)
    Not too bad. How about yourself, Patrick?
     
    Patrick Lane (Benzinga)
    I'm alive and kicking, man, alive and kicking. I'm gonna let you go right to it. And I'll get out of your way here.
     
    Matthew Timpane CMT (Schaeffer's Investment Research)

    All right, perfect. Well, as I said, my name is Matthew Timpane. I'm a senior market strategist over at Schaeffer's Investment Research. We've been in business now for over 40 years, providing retail investors with option trade recommendations, option education, and option news. I'm also a Chartered Market Technician. So my trade is to deal with technicals, and there is no better place to look at that than in the cannabis market.

    So today's presentation, when will we be in the next cannabis bull market? When will this happen? As I've stated kind of before at these conferences, this is something that's been really near and dear to my heart. Since high school, I've seen parents that were, you know, unfortunately put on narcotics for bad back pains, things like that on. With advancement in medical technology, not only were they able to get a surgery to help that pain, but then to get off the narcotics and to manage the pain that they still experienced, they moved to cannabis and it really kind of gave them their life back.

    One guy I knew was in a bed for about five years after he fell on to an elevator, down an elevator shaft and, you know, he really now is hiking in Arizona in retirement. So it's near and dear to my heart. I love being here. So I'm happy to be here with all of you today. So let's just take a look here. We're gonna do a quick overview of states to watch in 2022 and what to expect a macro overview and then some companies that we like.

    So far in 2021, New York, Connecticut, New Mexico, and Virginia have all passed recreational usage this year. And Alabama actually legalized medical usage as well. Florida, Hawaii, Minnesota, Nebraska and North Dakota considered, but they have not passed legislation to legalize cannabis this year, although I do believe voters once again will be trying to get it on the ballot in '22 in Florida after the previous reform was rejected by the state Supreme Court. For myself,

    Minnesota is my home state and they did not pass legalization as I stated, but they did relax laws this year on medical usage, starting in March 2022. Patients now will be able to purchase inhalable products. Previously, you're only able to use oil based and capsule based products that were allowed in the state. This really should lower the cost to as much as 1/3 of for the Minnesotans paying for their prescriptions.

    Also, South Dakota is another state that we're going to want to be watching as we head into 2022. For recreational use, they actually passed the law that was supposed to go into effect in July 2021 that the governor back the lawsuit to throw out the referendum and it's currently being seen in the Supreme Court there. So that's something we're going to really want to monitor as we move forward. Because you know, Florida already had their state Supreme Court throw out a referendum. So this is something we want to see for precedents moving forward.

    Delaware is a state that has already has medical marijuana program, I believe, since 2011. And now they want to make it legal for adult use. They filed in 2021 but it never came to the floor so they're hoping they can take that back up in January of 2022.

    Maryland. The State House Speaker already has promised to pass legislation to put legalization before the voters on the 2022 ballot. Missouri has a lot of activity going on right now. In the cannabis area. They kind of have included a movement to modify their existing medical marijuana program in place the referendum before voters in 2022. And then also making a recreational legal case for before the voters as well.

    Arkansas. They have an activist group called True Grass that is collecting signatures right now to get adult use legalization on the ballot in 2020. And then Ohio where we're based out of and I live. We've currently had medical usage now for about two years. But legalization is currently being pursued through two different avenues. There's a legalization bill in the state legislature currently right now and they also just obtained enough signatures to put it on the 2022 ballot let the voters decide.

    Oklahoma also has advocates making a strong push for the 2022 ballot. They did have had plans to get down 2020 ballot, but unfortunately the pandemic cut short those plans, so they're hoping to see it on the 2022 ballot.

    And then finally, Wyoming. Wyoming did fail to pass legalization this year. But advocates have won approval from the state for ballot language on a referendum to put before voters and they are currently gathering the necessary signatures to put it on the ballot.

     

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