A recent report by independent investment research and advisory firm GreenWave Advisors found that revenues for marijuana lab testing could hit $850 million by 2020. As more states legalize, there are bound to be state-mandated cannabis testing requirements and GreenWave Advisors is confident in saying that investors should take a serious look at the marijuana lab testing sector as a potential investment opportunity.
The report from GreenWave Advisors said, “As individual states debate the efficacy of current legislative statutes or contemplate initial legalization referendums, lab testing requirements of cannabis products has become an increasing subject of concern and attention. Although the current governing statutes regarding legalized marijuana uses vary in great degrees from state to state, one common theme that has emerged is the increased awareness on the part of legislators and health officials, as well as cultivators and laboratories, of the critical importance of product testing and quality assurance.”
GreenWave focused in on DigiPath Inc. (DIGP) as one of the few publicly traded cannabis laboratories. They are one of only two labs in Nevada and the company has already signed an agreement with the Euphoria Wellness dispensary to test its product for contaminants and solvents that can cause health issues.
The report points out that there are over 400 medicinal compounds found in the cannabis plant, but only eight states of the 23 legal medical marijuana states currently require testing. Five other states are looking into testing laws and it’s likely that the number of states doing the same thing will grow as they approve the drug and come face to face with the potential hazards.
The GreenWave report points to cannabis laboratories representing a positive investment opportunity because it gives investors the chance to get into the marijuana industry without dealing with “pure” marijuana and the legal issues that come with it. The report states, “Unlike Cannabis Science Inc. (CBIS), which is exploring clinical compounds, Mcig Inc. (MCIG), which focuses on vaporizer products, or MedBox Inc. (MDBX), which focuses on dispensary machines, DigiPath is well-positioned to meet an immediate regulator-driven demand for testing services. A company like DigiPath Inc. (DIGP) is well suited to take advantage of this growing industry with their existing lab, trusted scientific team, and experienced management professionals.”
More on Cannabis Financial Network’s profile on DigiPath Inc. can be found here.