What happened
GW Pharmaceuticals (NASDAQ: GWPH) stock rocketed 46.6% higher in January, according to data from S&P Global Market Intelligence . It was up another 6.3% this month through Friday.
The British biopharmaceutical company develops prescription drugs derived from cannabinoids, chemical substances found in marijuana.
For some context, the S&P 500 index returned 8% last month, and was up 0.2% in February as of the close Friday.
So what
GW Pharmaceuticals didn't release any notable information in January, nor in late December, nor was company specifically the subject of any material news during this period. So we can probably attribute the stock's strong performance last month largely to the enthusiasm surrounding the overall cannabis sector. Nearly all cannabis stocks soared in January, with Canadian grower Canopy Growth , the largest cannabis stock by market cap, skyrocketing 82.3%. Even shares of cannabis-focused real estate investment trust Innovative Industrial Properties , which tend to be less volatile than most cannabis stocks, jumped 36.4% last month .
This bullishness was likely due in part to the passage in December of the U.S. Farm Bill , which took effect on Jan. 1. That legislation legalized industrial hemp, marijuana's nonpsychoactive cannabis cousin.
Now what
Investors will be getting some material news soon. On Feb. 26, GW Pharmaceuticals is scheduled to release its results for the quarter ending Dec. 31. (The company in a press release described the quarter as "a transition period," as it is shifting its fiscal year to track the calendar year after this report.)
As I wrote in December, "GW stock's direction for the next couple years will likely highly depend upon how well Epidiolex is selling, so this is the key thing investors should focus on in fiscal 2019. Pipeline progress is also important." Epidiolex launched in this country in November after receiving the green light from the U.S. Food and Drug Administration in June to treat patients with two rare forms of epilepsy.
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Beth McKenna has no position in any of the stocks mentioned. The Motley Fool recommends Innovative Industrial Properties. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
