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Momentum investing is a factor-based investing strategy in which you invest in a stock whose price has risen faster than the market as a whole. Momentum investors believe that stocks which have outperformed the market will often continue to do so, because the factors that caused them to outperform will not suddenly disappear. In addition, other investors, seeking to benefit from the stock’s outperformance, will often purchase the stock, further bidding its price higher and pushing the stock higher still. These are the stocks that had the highest total return over the last 12 months.

These are the marijuana stocks with the highest year-over-year (YOY) sales growth for the most recent quarter. Rising sales can help investors identify companies that are able to grow revenue organically or through other means, and find growing companies that have not yet reached profitability. In addition, earnings per share can be significantly influenced by accounting factors that may not reflect the overall strength of the business. However, sales growth can also be potentially misleading about the strength of a business, because growing sales on money-losing businesses can be harmful if the company has no plan to reach profitability.

Marijuana stocks, as represented by the ETFMG Alternative Harvest ETF (MJ), have slightly outperformed the broader market. MJ has provided a total return of 36.9% over the past 12 months, above the Russell 1000 index’s total return of 35.0%. These market performance numbers and all statistics in the tables below are as of Aug. 23, 2021.

Fastest Growing Marijuana Stocks

The marijuana industry is made up of companies that either support or are engaged in the research, development, distribution, and sale of medical and recreational marijuana. Cannabis has begun to gain wider acceptance and has been legalized in a growing number of nations, states, and other jurisdictions for recreational, medicinal, and other uses. Some of the biggest companies in the marijuana industry include Canopy Growth Corp. (CGC), Cronos Group Inc. (CRON), and Tilray Inc. (TLRY). Many big marijuana companies have continued to post sizable net losses as they focus on investing in equipment to speed up revenue growth.

These are the marijuana stocks with the lowest 12-month trailing price-to-sales (P/S) ratio. For companies in the early stages of development or industries suffering from major shocks, this can be substituted as a rough measure of a business’s value. A business with higher sales could eventually produce more profit when it achieves, or returns to, profitability. The P/S ratio shows how much you’re paying for the stock for each dollar of sales generated.

Here are the top 5 marijuana stocks with the best value, the fastest growth, and the most momentum.

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One of the post-merger highlights was Tilray's SweetWater Brewing division opening a Colorado brewery and SweetWater Mountain Taphouse at the Denver International Airport in July. SweetWater also launched 420 Imperial IPA. At the end of June, SweetWater partnered with the company's Broken Coast craft cannabis brand to launch Broken Coast B.C. Lager.

"MSOS is the first and only actively managed U.S.-listed ETF with dedicated cannabis exposure focusing exclusively on U.S. companies, including multistate operators," AdvisorShares says. "The portfolio manager allocates across an investable universe of U.S. companies spanning a variety of cannabis-related businesses."

In the Canadian adult-use market, Tilray's goal is to grow its market share from 16% today to 30% by 2023. As for the U.S. market, its SweetWater Brewing and Manitoba Harvest businesses will continue to grow market share in their respective segments of the marketplace until the federal legalization of cannabis opens up Tilray's full participation in the U.S. cannabis industry.

GrowGeneration

Cresco Labs (CRLBF, $9.99), like Curaleaf, is a multistate operator with operations in 10 states, sporting 44 retail licenses, 18 production facilities and 32 operational dispensaries. Its national brands include Cresco, Reserve, Remedi and Mindy's (edibles).

Unlike MSOS, many of MJ's top 10 holdings are Canadian cannabis investments, such as the aforementioned Canopy Growth and Cronos Group. The top 10 holdings account for almost 53% of its assets, with the remaining 22 stocks accounting for the rest.

Cresco continues to grow its edibles portfolio to cater to market and consumer needs.

Marlboro maker Altria (MO, $48.22) has not had a good stretch over the past few years. The stock has delivered a five-year annualized total return (stock price and dividends) of negative 0.9%.