Despite the often disappointing performances of cannabis companies, production and sales figures for the green stuff are rising at very healthy rates. Last week, Statistics Canada updated its data about the contribution of various sectors to that country’s gross domestic product (GDP). You can probably guess which young industry saw a notably steep rise.

As if to hammer home the point, one high-profile North American marijuana stock reported quarterly figures that were nicely boosted by what’s effectively its cannabis business unit. Let’s take a closer look at both developments.

Image source: Getty Images.

O, Canada!

Following its release of data that revealed sharp growth in domestic cannabis sales, Statistics Canada unveiled encouraging production numbers for the industry.

The official statistics bureau of the Canadian government said that the marijuana sector’s contribution to GDP rose to $7.4 billion last November. That was a very healthy 15% year-over-year increase, which outpaced not only the broader economy — it grew 1.5% over that same stretch — but some of the most important industries in the country. 

This closely followed another data set from StatsCan showing that licensed cannabis sales in Canada topped the equivalent of $100 million that month — a new record for the industry, and the first time it crossed the nine-figure mark.

This is very encouraging for marijuana stock investors. It shows that, despite the many hiccups and challenges in this fully legalized market, there is plenty of demand for product, and enough manufacturing capacity to satisfy it. Now, if we could only get those supply and licensing problems ironed out… 

Scotts Miracle-Gro’s Q1 tops estimates

While we’re on the subject of green growth, Scotts Miracle-Gro (NYSE: SMG) reported first-quarter 2020 figures last week that, in a way, were powered by cannabis.

The company is a “picks-and-shovels” play on marijuana thanks to its Hawthorne Growing subsidiary. Formerly an independent company, Hawthorne makes the hydroponic equipment popular in indoor cannabis cultivation.

It’s also Scotts Miracle-Gro’s miracle growth unit. In Q1, its 41% year-over-year improvement in revenue helped drive overall company sales 23% higher. The latter hit almost $366 million, which was well above the average analyst estimate.

Since its Q1 doesn’t cover prime growing or cultivating season for plants generally, it’s typically an off-quarter for Scotts Miracle-Gro.

Nevertheless, the company managed to post a non-GAAP (adjusted) net loss that was considerably narrower than analyst expectations. It came in at $62 million, or $1.12 per share. On average, prognosticators were anticipating a per-share deficit of $1.27.

This is a unique marijuana stock, as it’s basically the only real equipment picks-and-shovels play in town at the moment. That’s a fine position to be in, since if anything the U.S. market will become wider and deeper with new states flipping the switch on the legalization of recreational marijuana. And, of course, there’s that nice Canadian growth.

This company’s popularity with cannabis stock investors is deserved, and I think its stock can still go higher.

Here’s The Marijuana Stock You’ve Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.

And make no mistake – it is coming.

Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.

And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.

Because a game-changing deal just went down between the Ontario government and this powerhouse company…and you need to hear this story today if you have even considered investing in pot stocks.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.