Dec 20, 2021
Last week, we started to highlight some of the best performing cannabis stocks and initially covered Innovative Industrial Properties, Inc. (NYSE: IIPR), a cannabis real estate investment trust (REIT).
When you combine price appreciation and dividend income from Innovative Industrial Properties, the stock has returned more than 1,500% since the initial public offering (IPO).
GW Leads the Pack
Another top performing publicly traded cannabis company was GW Pharmaceuticals, which was acquired by Jazz Pharmaceuticals (Nasdaq: JAZZ) for $225 per share earlier this year. The biotech company made history by commercializing the first cannabis based treatment to be approved by the US Food and Drug Administration (FDA).
In May 2013, GW Pharmaceuticals completed an IPO on Nasdaq and raised $31 million by offering 3.5 million shares for $8.90 each. If you made a $10,000 investment in GW when it went public, the investment would have been worth more than $250,000 (based on Jazz Pharmaceuticals’’ purchase price).
On a comparative basis, the percentage return that is associated with an investment in GW Pharmaceuticals’ IPO is considerably higher than the percentage return from an investment in Innovative Industrial Properties’ IPO.
Before GW Pharmaceuticals commenced trading on the Nasdaq, the biotech firm commenced trading on the Alternative Investment Market, which is the junior market of the London Stock Exchange, in 2001.
In 2016, GW Pharmaceuticals de-listed from London’s junior market and would only trade on the Nasdaq. The primary reasons behind the decision to de-list were to simply trading and to lower expenses from being dually listed.
Jazz Pharma Has Taken Investors on a Wild Ride
The market initially responded favorably to Jazz Pharmaceuticals’ acquisition of GW and the stock rallied approx. 15% from the day the transaction was reported (February 3rd) to the day the transaction was completed (May 5th).
After the acquisition was completed, Jazz Pharmaceuticals continued to trade higher and rallied another 15% over the next month. Following the spike higher, the Nasdaq traded biotech company came under heavy pressure and has fallen more than 33% from its post-acquisition high.
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