Have Cannabis Investors Been Early Or Wrong Or Both?

2025-04-22 14:05:00 ET

Summary

• The cannabis sector faces significant challenges, including political stagnation, lack of new state markets, and competition from the intoxicating hemp market.
• Leef Brands' Jesse Redmond on expanding in California and entering the New York market to improve margins and growth.
• Investors should consider reform-independent companies with strong balance sheets or those with clear growth catalysts, like Glass House and Grown Rogue.
• The cannabis industry's future remains uncertain, but long-term potential exists despite current volatility and regulatory hurdles.

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Cannabis expert Jesse Redmond shares why he's now at LEEF Brands (1:30). Excited about New York's evolution (8:15). How and why it got so bad in the industry (16:00). Are we early or are we wrong? (22:05) Who may survive and get to the finish line (28:35). Intoxicating hemp market (32:40).

Transcript

Rena Sherbill: Jesse Redmond, welcome back to Seeking Alpha. Always great to talk to you.

Jesse Redmond: Thank you, Rena. I appreciate you having me back.

RS: Yeah. Absolutely. Before we hit record, we were talking about how it's not necessarily fun and games out there in the markets as you're assessing investment opportunities. And, also, as I mentioned to you before we hit record, to me, you're sort of, for lack of a better term, the Big Mac index indicator for where we're at in the cannabis world.

You have a new job, and I think that speaks to where we're at and the need to find new ways to make the cannabis industry work. So you've been on before as an analyst . We had you on CEO Interviews , talking to many of the CEOs of cannabis companies. We both saw brighter days ahead that didn't necessarily come to pass.

So here we are almost in the middle of 2025, which also feels almost unfathomable that we're already in the middle of 2025. But share with us your new role in the cannabis industry and why you chose to make that move now.

JR: So my new role is head of investor relations and business development for a company called Leef Brands ( LEEEF ).

And I think the last couple of times we talked, I was head of the cannabis sector at Water Tower Research. Before that, I ran a cannabis investing consulting firm called Hire Calling. Before that, ran a dispensary, and long before that, ran a hedge fund. So that's been kind of a long story short of my career.

And I think me leaving Water Tower was pretty telling for what's going on in the sector, and I think you probably have seen, Rena, that I'm not the only analyst to have left, you know. Mike Regan is gone. Scott Fortune from Roth has has moved on. Owen Bennett, Owen with Jefferies, he's now at a coffee company, and we could go down the list and it'd be easier to name the cannabis analysts that are left rather than the cannabis analysts that have departed. So you've seen a pretty big exodus out of the sector. And I think one thing we wanna do in this conversation, Rina, is just be super honest about things....

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