Growlife Inc (OTCMKTS:PHOT) is a relatively good means to invest in the growing sector, however the firm’s risk cannot be understated. Analysts remain wary of OTC marijuana penny equities, and that is due to their insane valuations.
Many of the OTC marijuana penny stocks are overvalued and have years of growth priced into the shares price. It is better not to be fooled by the name “penny stock” as behind these small equities resides extensive market capitalization in the hundreds of millions, while share number in the billions.
Despite the considerable risks in this division, the returns are simply astronomical. Analysts have seen marijuana stocks gain nearly 20% a day for successive trading sessions. The penny stock market is mainly retail led, with relatively little institutional and algorithmic analysis. Subsequently, few other equities show this kind of market inefficiency.
There is a chance here for retail profit that is a far-fetched dream on the big exchanges. Weighing the risks and opportunities of investing in OTC pot penny stocks, analysts have settled on what they consider is the most legitimate and least overvalued firm in the sector, and that remains Growlife. Depending on the extreme valuations in the market, this stock could ideally have returns of more than 100% if it surged to the multiples of similar firms in the industry.
Risk-tolerant investors may seek an opportunity in Growlife depending on its comparatively small market capitalization compared to firms of similar size and profitability. The advantages of this relative undervaluation are numerous.
They showcase a better capital allocation and reduced investor relations expenditure. It also offers increased upside depending on positive news in the marijuana sector. Because of these elements, shareholders who want exposure to this marijuana market should pick Growlife over the other options. Marijuana legalization measures are making notable strides in North America, particularly Canada.