2016 is shaping up to possibly be a big year for marijuana stocks. Of those, we're taking a look at GreenGro Technologies (OTCMKTS:GRNH). What's interesting is that the stock has built a strong base of support below $.04. As we like to say, what can't go lower must go higher.GRNH has resistance at $.05 and if we can get through there, the stock could make a nice run. Driving this move higher is optimism over the marijuana industry in general as we head into 2016. There is a lot of legislation that will be addressed concerning marijuana use. Many states have initiatives for November that focus on legalizing or regulating marijuana for adult use. These include Nevada, Massachusetts, Arizona, Maine and California. Some states are trying to pull together legislation for the November ballots. They include Florida, Arkansas and Missouri.In Congress, there are a number of pieces of legislation that will be voted on. These include bills that would allow states to legalize medical marijuana without federal interference and reschedule marijuana to a schedule II drug. It would eliminate barriers to research and allow banks to work with marijuana companies.
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GRNH is already benefiting as California bill AB266 was signed into law on September 11, 2015 and goes into effect on January 1, 2016. GRNH announced that several new orders for its advanced greenhouse systems and stated that in store sales for November were 100% higher than October and December is setting new records. According to CEO James Haas:
"Greengro is very excited about this legislation. Finally our clients have the guidance necessary to legitimately grow their business. For us as a company we are quickly ramping up manufacturing capacity for our advanced greenhouse and modular grow room designs and aggressively seeking additional resellers that are capable of training install crews to accommodate the large spike in sales. We have been preparing for this opportunity for years. We have continued to refine our designs, and push our suppliers to give us the most reliable and cost effective components available. We are confident that our new modular grow rooms, automated light deprivation greenhouse systems, and DIY solar systems are among the highest quality at the most competitive prices in the industry. Our sales are growing exponentially because of turnkey systems sales and installation contracts. California is by far the largest producer of Medical Cannabis and we expect this new law will dramatically increase our business because cultivators have more confidence in the legality of their operations, and consequently purchase higher quality higher production turnkey systems from us. Our orders for greenhouses are already growing exponentially and we expect to sell several hundred in 2016."
The last sentence is what really caught our eye. If GRNH can sell several hundred greenhouses next year, it will be a game changer for the company. The good news for shareholders is that if the company can deliver, shares of GRNH have shown that they can catch fire pretty quick like they did at the beginning of 2014.
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Over the past few days, shares of GRNH have seen above normal trading volumes. Even better is that the stock has been upticking. To us, this is a sign of a large buyer accumulating shares before the New Year begins. The 3 month average trading volume has been around 1.5 million shares. Over the past few days, we've been seeing north of 3 million shares traded. These are all bullish signs. Don't miss out on the next move in GRNH shares, enter your email below and get ready for 2016!
Disclosure: We own no shares of GRNH and have not been compensated for this article.
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