After New Jersey voters agreed to legalize marijuana within its borders last week, it’s only a matter of time before neighboring states do the same, GrowGeneration CEO Darren Lampert told CNBC’s Jim Cramer Friday.
“We believe the rest of the East Coast will follow suit [and] legalize very soon,” he said in a “Mad Money” interview, calling the moment a “paradigm shift.”
New Jersey was not alone in approving measures on Election Day intended to open up the recreational marijuana market within their boundaries. Arizona, Montana and South Dakota also passed proposals to end prohibition. The state of Mississippi also moved to legalize the plant for medical purposes.
GrowGeneration, which supplies tools for gardening, expects to benefit from the expanding weed industry. Lampert said the Denver, Colorado-based company set up shot in the state of Arizona before the election in hopes of capitalizing on the potential $2 billion market there. The company sells tools used in the cultivation of marijuana.
“The election was a big victory for the cannabis industry and GrowGeneration,” he said. “It’s invigorating to see cannabis initiatives pass in five states. The green sweep.”
The company especially has its eyes set on the East Coast and hopes the passing of marijuana in New Jersey will cause the dominos to fall in surrounding states, leading to more efforts to legalize cannabis at least at the state level.
The Garden State is the first in the mid-Atlantic region to legalize marijuana and plans to tax sales at 6.625%. Local governments will also have rights to tack on additional fees.
While New York has attempted to legalize marijuana via the state legislature, those efforts have failed. It would have been just the second state after Illinois to legalize cannabis via that route.
Meanwhile, New York Gov. Andrew Cuomo has said he is in favor of legalization and in Pennsylvania, support among voters has grown.
Lampert said he also expects legalization is in the pipeline in Connecticut and Rhode Island.
“Jersey is another exciting market, [the] gateway to the North East,” he said, adding that the company is scouting locations to open up shot in the state in the spring. “We believe the rest of the East Coast will follow suit legalize very soon.”
GrowGeneration shares rallied 5% on Friday to a new closing high of $25.52. The stock has surged almost 40% higher since the Nov. 3 election.