When it comes to pot stocks, there is Innovative Industrial Properties, and there is everything else.
These guys are just built different than the others.
They don’t own the cannabis. They don’t even touch it. They own the properties that are used to grow, distribute, and sell it.
For this reason, they are not susceptible to all the well-known risks that the growers and dispensaries have to deal with.
So it is no surprise that the chart looks so different from its peer group.
Here’s IIPR making new multi-year highs as the Cannabis ETF $MJ is trading just off its all-time lows.
But, it gets better.
When discussing our Young Aristocrats scan at Portfolio Accelerator today, I realized I somehow missed this when putting out this month’s report.
We’re good, but we’re not perfect. It’s a travel week, so you’ll have to forgive me.
The more important point is that IIPR pays a near 6% dividend yield and has been growing it consistently for 7 years now. Its 5-year dividend growth rate is a whopping 32%.
If these guys can do this well during a complete wash-out cycle for cannabis, imagine how they will do when the industry finally bottoms out and turns the corner.
If they are growing the yield at over 30% during a bear market for pot stocks, what will that growth look like during good times?
I bought the stock last week in my retirement account. You know I’m all about the yield these days.
The chart setup is also perfect. This is the same rounding bottom reversal pattern we’ve been leaning on this entire cycle.
We want to be long IIPR above 125 with a target of 200. I think it goes back toward those old all-time highs eventually.
We talked about this name and a handful of other fresh bearish-to-bullish reversals today. The list of new uptrends keeps growing as breadth expands.
Now we’re going to eat some deep-dish pizza and go watch the Cubs play at Wrigley. Chicago is pretty cool, but it really doesn’t matter where we are. Getting to see the team and our clients and talk markets and everything else is what I’m here for. It’s been a blast.
If you want to join us at the next conference, you can apply here. Rumor has it its going to be in Miami in January. It doesn’t get much better than that.
