Tim Seymour Sees High Times Ahead For Cannabis Stocks

The slumbering cannabis sector has reawakened following Germany's partial legalization and possible rescheduling of marijuana in the United States. Tim Seymour, founder and CIO of Seymour Asset Management, joined Benzinga's PreMarket Prep Wednesday and discussed his views on these "exciting times” in cannabis.

What Happened: The regulatory changes announced by Germany last week were a significant catalyst for the recent rally in weed stocks. Germany's new laws will take effect on April 1 and remove cannabis from the country's Narcotics Act, where it was listed as a banned substance subject to specific criminal provisions. 

"Germany has quietly moved ahead of the U.S. They may totally, federally legalize the adult market before we do, as well," Seymour said on the show. 

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The portfolio manager pointed to Tilray Brands, Inc. TLRY as the major distributor in Europe best-positioned to benefit from the new German regulations. The company made key investments in Germany years ago, which may generate returns under the new cannabis regulatory system, according to Seymour.

Why It Matters: Cannabis investors view Germany's progressive legal changes as a step in the right direction for the industry, which is poised to benefit from increased sales and revenue growth. Many are hopeful the U.S. will take a similar path to federal rescheduling and possible decriminalization.

Related News: Canopy Growth CEO Says German Cannabis Market Has ‘Ability To Grow 10x’ Following Legalization

Seymour highlighted the increasing number of states that have legalized both medical and adult-use marijuana. He sees rescheduling in the U.S. as inevitable, and noted that the Biden Administration is running out of time before the next election. 

"There's no question about what's happening, no question about where it's eventually going to go," Seymour said. 

Vice President Kamala Harris recently pressured the Drug Enforcement Agency (DEA) to quickly reschedule marijuana during a roundtable discussion at the White House earlier this month.

"Marijuana is considered as dangerous as heroin and more dangerous than fentanyl which is absurd, not to mention patently unfair," Harris said during the roundtable conversation.

Seymour expects growth in the cannabis industry to be magnified by major improvements in efficiency and a steady stream of catalysts ahead. 

"Investors that are here now are certainly going to be rewarded," Seymour said. 

TLRY Price Action: According to Benzinga Pro, Tilray shares were up 0.92% at $2.50 at publication time.

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