Tilray, Cronos, and Canopy Growth Stocks See Significant Gains as Marijuana Legalization Efforts Gain Momentum

United States of Marijuana

Two of these three cannabis stocks will benefit most from today's marijuana news.

• Marijuana stocks are closing out the week on a strong note Friday, with shares of Cronos Group (NASDAQ: CRON) up a solid 5% through 10:50 a.m. ET, and Tilray Brands (NASDAQ: TLRY) and Canopy Growth (NASDAQ: CGC) doing even better -- up 11.8% and 26.6%, respectively.

What's happening in Germany

Germany recently passed a law that will fully legalize the drug in that country.

• Up until now, it's been an open question when exactly the law would take effect. But on Friday, German legislators declined to take a legislative step that would have delayed implementation of the law by six months. As a result, marijuana is set to become legal in Germany on April 1 -- legalizing marijuana possession, home growing, and also distribution among members of "social clubs."

For investors in cannabis stocks such as Tilray, Cronos, and Canopy Growth, that news alone sounds pretty good. Even better will be when the second stage of marijuana legalization happens, and Germany passes laws to standardize commercial production and retail sale of cannabis in the country.

Right now, Tilray probably stands in the best position to capitalize on that future development. It already generates approximately 45% of its annual revenue ($285 million) from the Europe, Middle East, and African region that includes Germany. Canopy Growth, with 12% of its revenue coming from Germany in particular, will also benefit from this development, while Cronos is less likely to benefit. According to data from S&P Global Market Intelligence, nearly 99% of Cronos' revenue come from just two countries -- Canada and Israel.

So if you're wondering why Tilray and Canopy Growth stocks are doing so much better than Cronos stock today, well, right there's your reason.