Highest Margin Cannabis Stocks
Updated March 2026Cannabis companies with the highest gross profit margins, indicating strong pricing power and operational efficiency.
Gross margin is a critical indicator of business quality in the cannabis industry. Companies with high gross margins have strong pricing power, efficient cultivation or manufacturing processes, and brands that command premium pricing. In a sector plagued by price compression in wholesale markets, the ability to maintain fat margins is a significant competitive advantage that separates potential winners from the pack.
Cannabis gross margins vary widely by business model. Vertically integrated MSOs that grow, process, and retail their own products typically achieve 45-55% gross margins. Licensed producers focused on wholesale may see 25-40% margins depending on cultivation efficiency. Ancillary companies providing technology or services can achieve 60%+ margins because they avoid the capital intensity of plant-touching operations. Understanding these structural differences is essential for meaningful margin comparisons.
The ranking below lists every cannabis stock with a positive gross margin, sorted from highest to lowest. Use this data alongside revenue and valuation metrics to identify companies that are not just growing but growing profitably.
Highest Margin Cannabis Stocks — Full Rankings
15 stocks · Ranked by gross margin
| # | Ticker | Name | Price | Change | Market Cap | Revenue | Margin | P/S | Gross Margin |
|---|---|---|---|---|---|---|---|---|---|
| 1 | KERN | Akerna Corp | $6.27 | +24.64% | $376.3M | $6.8M | 402.0% | 55.05x | 402.0% |
| 2 | MAPS | WM Technology (Weedmaps) | $0.68 | -7.27% | $73.0M | $174.7M | 94.9% | 0.42x | 94.9% |
| 3 | LFLY | Leafly Holdings | $135.50 | +17.98% | $271.0M | $34.6M | 90.2% | 7.82x | 90.2% |
| 4 | AGFY | Agrify Corp | $47.12 | +4.71% | $94.2M | $15.4M | 75.5% | 6.12x | 75.5% |
| 5 | YCBD | cbdMD Inc | $0.71 | -0.75% | $7.5M | $19.1M | 59.8% | 0.39x | 59.8% |
| 6 | TPB | Turning Point Brands | $90.62 | +0.69% | $1.73B | $463.1M | 55.9% | 3.75x | 55.9% |
| 7 | FORA | Forian Inc | $2.05 | -0.97% | $63.7M | $28.1M | 51.6% | 2.27x | 51.6% |
| 8 | VFF | Village Farms International | $2.87 | -6.51% | $331.5M | $253.3M | 38.7% | 1.31x | 38.7% |
| 9 | CRON | Cronos Group | $2.50 | +0.81% | $947.6M | $146.6M | 36.4% | 6.46x | 36.4% |
| 10 | XXII | 22nd Century Group | $3.88 | +1.97% | $2.0M | $18.1M | 36.3% | 0.11x | 36.3% |
| 11 | CGC | Canopy Growth | $1.02 | -2.86% | $385.4M | $278.4M | 28.8% | 1.38x | 28.8% |
| 12 | GRWG | GrowGeneration | $1.06 | -2.75% | $63.4M | $161.4M | 27.2% | 0.39x | 27.2% |
| 13 | TLRY | Tilray Brands | $6.89 | -1.57% | $802.7M | $837.3M | 26.4% | 0.96x | 26.4% |
| 14 | SMG | Scotts Miracle-Gro | $60.96 | +0.96% | $3.54B | $3.35B | 25.0% | 1.06x | 25.0% |
| 15 | HYFM | Hydrofarm Holdings | $1.19 | -6.30% | $5.6M | $146.4M | 11.6% | 0.04x | 11.6% |
Top 3 Spotlight
Akerna Corp
Akerna Corp ranks #1 in the highest margin cannabis stocks category with a share price of $6.27 and a market capitalization of $376.3M. The company operates in the Ancillary sector and is listed on the NASDAQ. With trailing twelve-month revenue of $6.8M and a gross margin of 402.0%, KERN represents the top-ranked stock in this category based on gross margin.
WM Technology (Weedmaps)
WM Technology (Weedmaps) ranks #2 in the highest margin cannabis stocks category with a share price of $0.68 and a market capitalization of $73.0M. The company operates in the Ancillary sector and is listed on the NASDAQ. With trailing twelve-month revenue of $174.7M and a gross margin of 94.9%, MAPS represents the second-ranked stock in this category based on gross margin.
Leafly Holdings
Leafly Holdings ranks #3 in the highest margin cannabis stocks category with a share price of $135.50 and a market capitalization of $271.0M. The company operates in the Ancillary sector and is listed on the NASDAQ. With trailing twelve-month revenue of $34.6M and a gross margin of 90.2%, LFLY represents the third-ranked stock in this category based on gross margin.
Methodology
Stocks are filtered to include only companies with positive gross margins and ranked in descending order by gross margin percentage. Data is sourced from company filings, exchange feeds, and financial data providers. Rankings update automatically as new data becomes available. All financial figures are based on trailing twelve-month (TTM) data unless otherwise noted. The current ranking includes 15 qualifying stocks out of 100 total cannabis companies tracked by Cannabismarketcap.
Key Observations
The top-ranked stock in the highest margin cannabis stocks category is KERN (Akerna Corp) with a gross margin of 402.0%. The stock trades at $6.27 per share with a market capitalization of $376.3M. In second place is MAPS (94.9%), followed by LFLY (90.2%) in third.
Across all 15 qualifying stocks, the average share price is $24.22 and the average market capitalization is $579.8M. The combined trailing twelve-month revenue of all companies in this category is $5.93B. The average gross margin among companies with positive margins is 70.7%. The average price-to-sales ratio is 5.83x.
The most represented sector in this category is Ancillary with 9 out of 15 companies (60%). Among the ranked stocks, 7 are trading higher today while 8 are trading lower. Investors should use these observations as a starting point for further research rather than as the basis for trading decisions.
Investment Considerations
When evaluating stocks in the highest margin cannabis stocks category, consider looking beyond the primary ranking metric to build a holistic view of each company. A stock that ranks well by gross margin may have weaknesses in other areas — such as high debt, poor margins, or slowing growth — that the ranking alone does not capture. Cross-reference this list with other Cannabismarketcap category pages and the screener tool to identify stocks that score well across multiple dimensions.
Position sizing is particularly important in cannabis. The sector is inherently volatile, and even the strongest companies can experience 30-50% drawdowns during sector-wide sell-offs triggered by legislative disappointments or broader market risk-off events. Most financial advisors suggest limiting total cannabis exposure to 5-15% of your portfolio, and individual positions to 1-3% depending on your risk tolerance and conviction level.
Dollar-cost averaging (DCA) is a widely recommended approach for building cannabis stock positions over time. Rather than investing your entire allocation at a single price point, spreading purchases across weeks or months can reduce the impact of short-term volatility and lower your average cost basis if prices decline after your initial purchase. This strategy is particularly relevant for the stocks in this category given the sector's history of sharp and sometimes prolonged drawdowns.
Risk Factors
Risk Warning
High gross margins can be misleading if not contextualized. Some cannabis companies report elevated margins because they operate in limited-license states with less competition, benefit from one-time fair value adjustments on biological assets (common among Canadian LPs), or have artificially low cost bases that will increase as they scale. Margins can also compress rapidly as new competitors enter a market, wholesale prices decline, or a company shifts its sales mix toward lower-margin product categories. Additionally, gross margin tells you nothing about operating expenses — a company with 60% gross margin but enormous SG&A costs may still be deeply unprofitable at the operating and net income levels.
Compare These Stocks
Head-to-head comparisons between top-ranked stocks in this category.
Frequently Asked Questions
What is a good gross margin for a cannabis company?
A good gross margin depends on the business model. For vertically integrated MSOs, 45-55% is considered healthy. Canadian licensed producers typically target 35-50%. Ancillary and technology companies often achieve 55-75%. Margins below 30% for a plant-touching company may indicate operational inefficiency, unfavorable market dynamics, or a wholesale-heavy revenue mix. Always compare margins to peers with similar business models rather than the sector average.
Why do some cannabis companies report very high gross margins?
Several factors can inflate reported gross margins. Canadian LPs using IFRS accounting may include unrealized fair value gains on biological assets in their gross profit calculation, which inflates margins with non-cash adjustments. Companies operating in limited-license states face less price competition and can charge premium prices. Some companies exclude certain costs from cost of goods sold that peers include, making apples-to-apples comparisons difficult. Always read the notes in financial statements to understand what is included in COGS.
How do gross margins in cannabis compare to other industries?
Cannabis gross margins are generally comparable to consumer packaged goods (CPG) and specialty retail, which typically range from 40-60%. They are lower than software companies (70-90%) but higher than traditional agriculture (15-25%) and grocery retail (25-35%). The relatively high margins in cannabis reflect the premium pricing that branded, regulated products can command. However, as the industry matures and competition intensifies, margins are expected to gradually compress toward levels seen in mature CPG categories.
Is gross margin or operating margin more important for cannabis stocks?
Both matter, but operating margin arguably provides a more complete picture because it captures selling, general, and administrative (SG&A) expenses that gross margin ignores. A company with a 55% gross margin but a -15% operating margin is spending heavily on overhead and may not be on a path to profitability. That said, gross margin is the starting point — if a company cannot achieve adequate gross margins, no amount of cost-cutting at the operating level will produce a sustainable business.
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Disclaimer: The information on this page is for informational and educational purposes only and does not constitute investment advice, a recommendation, or a solicitation to buy or sell any security. Cannabis stocks are highly speculative and carry significant risk of loss, including the potential loss of your entire investment. Past performance is not indicative of future results. The rankings and data presented are based on publicly available financial information and may contain errors or omissions. Always do your own research and consult with a qualified financial advisor before making investment decisions. Cannabismarketcap is not a registered investment advisor, broker-dealer, or financial planner.