Former New Zealand Prime Minister Helen Clark has urged Kiwis to vote in favour of recreational cannabis being legalized at next year’s referendum.

She recently set up a think tank called The Helen Clark Foundation and it has just issued a report called “The Case for YES”. It recommends expunging minor cannabis convictions and ushering in a legal market that can regulate marijuana in a responsible fashion.

“Isn’t this [the current approach] a waste of the justice system’s time and money?” she said. “Haven’t the police got better things to do? Aren’t we better to face the reality that 80% of Kiwis are going to try this at some point in their lives?”

Clark was the 37th Prime Minister of New Zealand and she led the country from 1999 to 2008. Had she been given a fourth term in office, she claims she would have sought to legalize recreational cannabis use.

Her administration did not advance cannabis policy in any significant way, but the current government has decided to ballot the people on whether adult-use cannabis should be permitted. Kiwis will vote in a general election next year and they will also be able to vote on whether or not recreational cannabis should be legalized on the same ballot.

New Zealand has one of the highest cannabis consumption levels in the world, according to the World Drug Report. It legalized medical cannabis use in 2017 and an industry is starting to take shape.

The Helen Clark Foundation believes New Zealand should follow in the footsteps on Uruguay, Canada and various U.S. states by ushering in a more mature attitude towards cannabis use.

It claims that a “yes” vote in 2020 would advance public health objectives and promote greater social equity. It adds that prohibition does not work, it cannot eradicate consumption, it is a waste of police time and it disproportionately punishes the Māori community.

Clark wants to see New Zealand treat cannabis use as a social and public health issue rather than a criminal one. She insists that decriminalizing it is not enough, and that New Zealand should study developments in Uruguay and North America before ushering in a commercial, regulated industry.

She also wants to see individuals and communities that were most affected by prohibition to benefit from any changes to the law, allowing them a fair chance to become retailers and producers. Clark warned that large, profit-driven cannabis conglomerates should not be able to dominate New Zealand’s cultivation and retail trades.

August wasn't a great month for most marijuana stocks. For that matter, neither was May, June, or July. Ups and downs come with the territory with investing in marijuana stocks, though.

But now we're in a new month and there's plenty to keep your eyes on in the ever-changing cannabis industry. Three top marijuana stocks that I think investors should especially watch in September are Aurora Cannabis (NYSE: ACB), HEXO (NYSE: HEXO), and CannTrust Holdings (NYSE: CTST). Here's what to look for with these three pot stocks.

1. Aurora Cannabis

Most of the big Canadian cannabis producers have already reported their latest quarterly results. However, Aurora Cannabis will be late to the party. By Sept. 15, the company is scheduled to provide an update for its quarter ended June 30.

Aurora gave a preview in early August for what investors can expect in its fiscal fourth-quarter results. The company should announce net revenue of between $100 million and $107 million Canadian. The midpoint of that range reflects a 59% jump from Aurora's net revenue in the previous quarter. 

Based on comments made by Chief Corporate Officer Cam Battley in the company's fiscal 2019 Q3 conference call, you can also expect that Aurora will report positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). However, the company didn't confirm this in its sneak peek at its fiscal Q4 results, so there could be a negative surprise in store. 

Maybe, just maybe, Aurora might also have some big news on the partnership front. The company brought billionaire investor Nelson Peltz on board in March to help line up deals with major partners outside of the cannabis industry. Aurora is behind several of its large peers in landing a partner but hasn't given any hints about the progress of Peltz's efforts yet.

2. HEXO

Like Aurora, HEXO isn't on the same timetable for reporting its quarterly results as most Canadian cannabis producers. HEXO announced its fiscal 2019 third-quarter results in mid-June. Although the company hasn't yet set a date for its Q4 results, it seems likely that there will be an update this month.

HEXO should have some good news to report whenever its Q4 update happens. CEO Sebastien St.-Louis has predicted the company would double its revenue in the fourth quarter from the Q3 amount. The key to achieving that goal is HEXO's increased packaging capacity.

While HEXO isn't likely to be profitable in Q4 barring a boost from special items, there could be some confirmation that the company is on the right track. St.-Louis expects his company to achieve profitability in 2020, although he left some wiggle room by also stating that HEXO's investments in research and development could impact its bottom line.

HEXO already has a big partner, Molson Coors Brewing. But the company could shed more light on its discussions with a large number of Fortune 500 companies about potential partnership deals. HEXO anticipates adding at least one other major partner in 2020. 

3. CannTrust

CannTrust can't be accurately described as a top marijuana stock after its horrible fall in recent months. But the company is certainly a top marijuana stock to watch in September, if for no other reason than to find out if there are any other skeletons in its closet.

Existing research suggests that the effects of cannabis on sleep may depend on many factors, including individual differences, cannabis concentrations and frequency of use.

If you speak to someone who has suffered from insomnia at all as an adult, chances are good that person has either tried using marijuana, or cannabis, for sleep or has thought about it.

This is reflected in the many variations of cannabinoid or cannabis-based medicines available to improve sleep – like Nabilone, Dronabinol and Marinol. It’s also a common reason why many cannabis users seek medical marijuana cards.

I am a sleep psychologist who has treated hundreds of patients with insomnia, and it seems to me the success of cannabis as a sleep aid is highly individual. What makes cannabis effective for one person’s sleep and not another?

While there are still many questions to be answered, existing research suggests that the effects of cannabis on sleep may depend on many factors, including individual differences, cannabis concentrations and frequency of use.

Cannabis And Sleep

Access to cannabis is increasing. As of last November, 28 U.S. states and the District of Columbia had legalized cannabis for medicinal purposes.

Research on the effects of cannabis on sleep in humans has largely been compiled of somewhat inconsistent studies conducted in the 1970s. Researchers seeking to learn how cannabis affects the sleeping brain have studied volunteers in the sleep laboratory and measured sleep stages and sleep continuity. Some studies showed that users’ ability to fall and stay asleep improved. A small number of subjects also had a slight increase in slow wave sleep, the deepest stage of sleep.

However, once nightly cannabis use stops, sleep clearly worsens across the withdrawal period.

Over the past decade, research has focused more on the use of cannabis for medical purposes. Individuals with insomnia tend to use medical cannabis for sleep at a high rate. Up to 65 percent of former cannabis users identified poor sleep as a reason for relapsing. Use for sleep is particularly common in individuals with PTSD and pain.

This research suggests that, while motivation to use cannabis for sleep is high, and might initially be beneficial to sleep, these improvements might wane with chronic use over time.

Does Frequency Matter?

We were interested in how sleep quality differs between daily cannabis users, occasional users who smoked at least once in the last month and people who don’t smoke at all.

We asked 98 mostly young and healthy male volunteers to answer surveys, keep daily sleep diaries and wear accelerometers for one week. Accelerometers, or actigraphs, measure activity patterns across multiple days. Throughout the study, subjects used cannabis as they typically would.

Our results show that the frequency of use seems to be an important factor as it relates to the effects on sleep. Thirty-nine percent of daily users complained of clinically significant insomnia. Meanwhile, only 10 percent of occasional users had insomnia complaints. There were no differences in sleep complaints between nonusers and non-daily users.

Interestingly, when controlling for the presence of anxiety and depression, the differences disappeared. This suggests that cannabis’s effect on sleep may differ depending on whether you have depression or anxiety. In order words, if you have depression, cannabis may help you sleep – but if you don’t, cannabis may hurt.

Future Directions

Cannabis is still a schedule I substance, meaning that the government does not consider cannabis to be medically therapeutic due to lack of research to support its benefits. This creates a barrier to research, as only one university in the country, University of Mississippi, is permitted by the National Institute of Drug Abuse to grow marijuana for research.

New areas for exploration in the field of cannabis research might examine how various cannabis subspecies influence sleep and how this may differ between individuals.

One research group has been exploring cannabis types or cannabinoid concentrations that are preferable depending on one’s sleep disturbance. For example, one strain might relieve insomnia, while another can affect nightmares.

Other studies suggest that medical cannabis users with insomnia tend to prefer higher concentrations of cannabidiol, a non-intoxicating ingredient in cannabis.

This raises an important question. Should the medical community communicate these findings to patients with insomnia who inquire about medical cannabis? Some health professionals may not feel comfortable due to the fluctuating legal status, a lack of confidence in the state of the science or their personal opinions.At this point, cannabis’s effect on sleep seems highly variable, depending on the person, the timing of use, the cannabis type and concentration, mode of ingestion and other factors. Perhaps the future will yield more fruitful discoveries.

Getting in on the ground floor of a potentially revolutionary venture before it explodes is one of the best ways for pot stocks to grow. That growth may be all at once, or it may be slow and steady, but if the whole sector begins turning towards one trend or one factor that reliably leads to profit, the companies that established an early position in that factor will see the greatest benefit.

This is why Canadian companies are so well-positioned in the cannabis industry. Early legalization allowed corporations across Canada to become first-movers in a number of key markets.

Now, many of these companies are looking for the next region to offer a first-mover advantage. While Europe has gradually been opening up to cannabis enterprise, yielding growth for some CBD companies, one little-known African nation is suddenly drawing a lot of attention from pot stocks across the sector.

Lesotho Might Be the Best Place in the World to Grow Cannabis

The Kingdom of Lesotho is a landlocked country entirely surrounded by South Africa. With a population that’s just over two million, this former British commonwealth nation is one of the smallest on the African continent but is also one of the best educated.

In December 2017, it became the first African country to legalize the cultivation of marijuana for medicinal purposes. While this brought some initial interest from investors, it’s only in the last year or so that pot stocks have begun to realize what a one-of-a-kind opportunity Lesotho provides.

A combination of low-cost labor, accessibility to Europe, and a climate that’s ideal for cannabis cultivation has led Canadian companies to begin racing to Lesotho. The country is washed in sun—enjoying 300 sunny days a year—but sits at a high altitude, keeping humidity perfect. The soil is also especially fertile, yielding high-quality cannabis. This has led the country to become a hotspot of cultivation to feed Europe’s growing demand for cannabis.

On top of that, Africa itself is a market on the rise. By 2023, legal cannabis sales on the continent could be worth $7.1 billion according to the African Cannabis Report.

The government of Lesotho has even been called “very proactive, very co-operative” to the incoming corporations. After the initial round of cannabis cultivation licenses were granted last year, a second round is fast approaching, meaning that more companies will take advantage of the valuable cultivation space that Lesotho provides.

So which pot stocks have been making moves in this country?

Canopy Growth

Last year, the world’s biggest cannabis corporation, Canopy Growth Corporation (TSX:WEED) (NYSE:CGC), become one of the first to recognize the incredible potential of Lesotho.

In May 2018, Canopy acquired licensed producer Daddy Cann Lesotho for $28.8 million CAD. This move represented the company’s “first step into Africa,” according to Canopy President Mark Zekulin.

The acquisition provided Canopy with two facilities, the first containing 21 million square feet of outdoor cultivation space, and the second containing 322,000 square feet of indoor, outdoor, and greenhouse space combined. At both of these locations, the company is growing CBD-dominant and CBD/THC-balanced cannabis strains.

Supreme Cannabis

Despite its early foot in the door, Canopy was not the first cannabis company to establish its presence in Lesotho. That distinction goes to Supreme Cannabis Company (TSX:FIRE) (OTCQX:SPRWF).

In March 2018, Supreme spent $10 million to acquire approximately 10 percent of Medigrow Lesotho Limited. This deal will see Medigrow produce medicinal cannabis oil in Lesotho, which will then be exported to Canada for distribution by Supreme.

Though the African Kingdom offers unique benefits to companies operating in any corner of the cannabis sector, it’s a particularly good investment to pot stocks looking to capitalize on cannabis oil. Spokesmen for the Lesotho government have gone on record saying that they want their country to become “one of the world’s largest exporters” of cannabis oil for pharmaceutical purposes.

At the end of May 2019, South Africa legalized the sale of CBD products. Seeing as Lesotho is located literally in the middle of South Africa, companies in the region are incredibly well-positioned to provide CBD to the nation’s 57 million residents.

Halo Labs

Halo Labs (OCTQX:AGEEF) is one of the smaller pot stocks investing in Lesotho. Currently trading at $0.32, it’s not a company with a lot of capital to spend on experimental or frivolous ventures. That’s why, with the funds it does have, it followed Supreme and Canopy into southern Africa.

In July 2019, Halo bought a Lesotho-based medicinal cannabis company, Bophelo Bioscience & Wellness, for roughly $18.4 million. This provides Halo with a little more than half a million square feet of cultivation space and made it the first American cannabis company in the country.

Halo Labs CEO Kiran Sidhu said in an interview that, “Out of all the places we’ve looked in the world—be it Columbia, Cambodia, etc—Lesotho is the best positioned place on the planet right now to grow cannabis cost-effectively, in a perfect climate, with a great regulatory environment.”

It remains to be seen which companies will be the next to hop on the train to Lesotho, but the prospects of this nation becoming the heart of cannabis cultivation and sales to the rest of Africa—and indeed, to Europe and even North America—look incredibly strong. These three pot stocks already have a presence there, and very soon more will be racing to join them.