Big Tobacco Should Consider Marijuana, Says Wall Street Firm

87An esteemed Wall Street company, RBC Capital Markets, has come up with a piece of advice for big tobacco companies: Start considering marijuana because the herb is likely here to stay.

That was a suggestion that came out of a research note written by an RBC analyst, circulated as a memo, and then wound up on the desks of Business Insider. The analyst pointed out in the memo several political factors that indicate cannabis legalization isn’t just a stroke of luck, but an ongoing trend with a future.

The memo touches on the possibility of the federal law finally legalizing marijuana, saying that “full federal legalization of marijuana in the US would likely lead tobacco companies to reconsider this space.”

“We believe it is only a matter of time until investors start asking questions about how it [marijuana] will fit into the bigger picture,” it adds.

Supporting this hypothesis, the memo cites recent polls, which have found that a majority of Americans currently favor marijuana legalization. The polls also indicate that it is a generational issue, as 69% of millenials support full legalization. This means that the sector will be getting older and wealthier. It will also vote more in the years to come, leading the memo to suggest that marijuana could be a “critical topic” affecting the 2016 presidential election.

The memo however mentions that every tobacco company management that the research has spoken to was unwilling to discuss the topic of marijuana.

Posted in: Articles

Comments are closed.