Stock Market

It wasn’t long before marijuana was considered a taboo. Emerging science, however, has altered customer perceptions and has paved a path for its legalization. As a result, the global legal marijuana market continues to expand at an impressive rate. Most recently, PSY (NYSEARCA:PSY), the first psychedelic stock ETF, hit the market. In turn, several psychedelic stocks have gained handsomely in the past month.

The PSY ETF was set up at the end of May to invest in psychedelic stocks involved in treating mental ailments. The companies in the index need to have a market capitalization of at least $75 million. With the massive growth in the global marijuana market, the ETF can generate sizeable returns for its investors down the line. The market is expected to grow from $22 billion to $97 billion by 2026, with a 28% compound annual growth rate (CAGR).

So, with all of that in mind, these are three of the most promising psychedelic stocks that have gotten high in the past month.

  • Mind Medicine (NASDAQ:MNMD)
  • Numinus Wellness (OTCMKTS:LKYSF)
  • COMPASS Pathways (NASDAQ:CMPS)

Now, let’s dive in and take a closer look at each one.

Psychedelic Stocks: Mind Medicine (MNMD)

Source: Shutterstock

Psychedelic therapy maker Mind Medicine is one of the pioneers in using psychedelic chemicals in the treatment of mental illnesses. It has a couple of clinical trials in the second phase, which examine the efficacy of psychedelics such as LSD on conditions like ADHD and anxiety. It recently published a study that effectively linked human genetics to the processing of LSD in the body. Moreover, in the past month, MNMD stock has generated a healthy 12% return.

Mind Medicine became one of the first NEO-listed companies to be added to the MSCI Small Cap Canada Index. It was also the first to go from the NEO to the Nasdaq as well. It exited its most recent quarter with total assets worth $201 million, including $160 million in cash. With its massive cash balance, it will continue to pursue its diversified pipeline of psychedelic drugs. Additionally, it is also collaborating with Nextage Therapeutics to develop psychedelic-inspired drugs.

Numinus Wellness (LKYSF)

Source: Shutterstock

Numinus is a Canadian psychedelic solutions provider which was the first to complete a harvest of psilocybe mushrooms. It operates its three core business divisions which include bioscience, research and development (R&D) and health. Moreover, it holds import, export, and testing licenses for MDMA, psilocybin, DMT and other related psychedelics. Though LKYSF stock is trading in the penny stock territory, it has an incredible growth runway ahead, pushing the stock significantly higher.

The company is planning to significantly expand its research facility by 7,500 feet. Moreover, it also generates a minuscule amount of revenue through analytics testing for psychedelics. Revenues are also growing via its acquisition of clinics that use psychedelic therapy treatments.

Additionally, the company is well funded with a strong cash position of $28.5 million as of February. Therefore, it’s in a strong position to continue expanding its business and furthering its pipeline progression.

Psychedelic Stocks: Compass Pathways (CMPS)

Source: Shutterstock

Compass Pathways is a mental healthcare company that is developing a psilocybin formulation known as COMP360. The formulation could potentially be used as a therapy for treatment-resistant depression (TRD). The COMP360 is currently in its second phase of clinical trials, and its results will come out at the end of 2021. TRD has a remarkably high relapse rate and currently impacts more than 100 million people worldwide. Therefore, CMPS stock has a massive addressable market, from it where it could generate a sizeable amount of revenues in the future.

COMP360 could have several benefits for patients and the community at large. It would ultimately reduce the cost of care, increase employee productivity, and result in a more efficient allocation of healthcare resources. Cash equivalents as of March are at a healthy $179.5 million, which should be enough cash for the next couple of years at least.

On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.