Jim Cramer’s head is spinning, and not from secondhand smoke.
“The normalization of weed is happening so fast it makes my head spin,” the host of CNBC’s “Mad Money” said on Friday. “It’s not just that Canada and a host of states have outright legalized pot. It’s that marijuana’s gone mainstream.”
Cramer’s epiphany came when Brian Athaide, the CEO of Canadian cannabis player Green Organic Dutchman, took the helm of the company after 25 years at Procter & Gamble, which Cramer called “the most mainstream company on earth.”
“I can’t even explain how incongruous this is,” he said. “A P&G executive in the marijuana business? A year or maybe two years ago, I would’ve told you that sounds about as plausible as ‘Cheech & Chong join the DEA’ or ‘Harold & Kumar go to Breakfast at Tiffany’s.'”
But with Canada approving full legalization of recreational marijuana use, a move set to go into effect in mid-October, Athaide calculated that “the opportunity was just too great,” the “Mad Money” host said.
Risks still remain when it comes to the investable portion of the marijuana market, however.
Athaide told Cramer at Friday’s Green Market Report cannabis conference that investors shouldn’t expect profits to surge when Canada’s legalization goes into effect because there’s so little infrastructure to sell cannabis products legally.
And even though Cramer was fascinated by Athaide’s market-share estimates — an up to $500 billion opportunity worldwide considering the potential for oil, pharmaceutical, pet health, edible and drinkable products — he agreed that Wall Street shouldn’t get ahead of itself.
“I want to introduce you to these high-quality, new companies one by one, but I also need to echo Brian’s concerns,” he said. “Don’t get ahead of yourself with the cannabis cohort or your gains could go up in smoke.”
“So pay close attention, dabble if you want — my favorite remains Canopy because of Constellation’s involvement — but don’t believe all the hype,” the “Mad Money” host concluded.
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