Will the rescheduling of cannabis fuel a boom in cannabis stocks? Analysts from Z&A delve into the pros and cons of MSOs and cannabis rescheduling in their latest equity research report.

Re-scheduling Vs. De-scheduling: What Is The Difference?

Re-scheduling cannabis refers to the process of changing its current classification within the legal framework while maintaining some level of regulation. De-scheduling cannabis, on the other hand, involves removing it entirely from the list of controlled substances, eliminating all federal restrictions.

If a country classifies cannabis as a Schedule I drug, re-scheduling it to Schedule II would mean acknowledging some medicinal value while retaining restrictions.

De-scheduling would altogether remove all legal barriers, allowing it to be treated like any other non-controlled substance. Often, rescheduling is cited as a powerful catalyst for MSO stocks and for all US plant-touching businesses.

Is Cannabis Rescheduling The Right Move For MSOs?

Zuanic & Associates (Z&A) note that the narrative regarding the potential for rescheduling and its resulting benefits, does not tell a full picture, and rescheduling of medical marijuana may not be beneficial for MSOs.

According to Z&A, de-scheduling “is unlikely,” while “re-scheduling of medical cannabis (MMJ) is not without risks.”

“Rec cannabis cannot be rescheduled (or do we want Drs also to have to prescribe rec cannabis, as would be the case if in Schedule III)?” asks the report.

What if Biden's White House is on the point of rescheduling cannabis?

In that case, the report suggests: “lobbying DC for a SAFE Banking Act with safe harbor language for US exchanges matters too (or even just for the basic version of SAFE), but the industry should start thinking about the consequences of MMJ rescheduling (not just the 280E bit).”

What are the alternatives?

According to the report MSOs, should “lobby for the removal of 280E outright, without re-scheduling, and leave cannabis in Schedule I.”

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Interested in more information on cannabis investments? Click the tickers below for instant updates.

Cambria Cannabis ETF (BATS:TOKE) is down 0.25% at about $6 a share on Friday.
Amplify Seymour Cannabis ETF (NYSE:CNBS) is up 1.18% at last check on Friday, at about $3.86 a share
AdvisorShares Pure Cannabis ETF (NYSE:YOLO) is down 0.78% Friday at about $2.55.
ETFMG Alternative Harvest (NYSE:MJ) is down 0.68% at about $1.46.
AXS Cannabis ETF (NYSE:THCX) is up 1.11% at $1.82.
Global X Cannabis ETF (NASDAQ:POTX) is up 1.23% at last check on Friday, hovering at around $6.60.

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MSOs And Cannabis Rescheduling: A Safer Bet? Analyst Looks Closer At Pros And Cons