Boehner's `Bombshell' Weed Reversal `Monumental' for Marijuana

(Bloomberg) -- The pot industry panicked when U.S. Attorney General Jeff Sessions ended the government’s hands-off policy on weed. Today, it can breathe a bit easier as former Republican House Speaker John Boehner joins the advisory board of U.S. cannabis producer Acreage Holdings.

“It is difficult to overstate the impact of this monumental event for the U.S. cannabis sector,” Vahan Ajamian, analyst at Beacon Securities Ltd., wrote in a note Wednesday.

The announcement that Boehner and former Massachusetts Governor William Weld will advise Acreage, a private company, “should send shockwaves throughout the industry and act as a positive catalyst for the sector as a whole,” Ajamian said.

Boehner’s move marks a fundamental shift for a man who said nine years ago he was “unalterably opposed” to legalization, and indicates that pot is increasingly supported by the American establishment even if the Attorney General still believes “good people don’t smoke marijuana.”

Pot stocks, many of which are listed in Canada because of U.S. legal uncertainty, have been struggling this year after nearly tripling in 2017. The BI Global Cannabis Competitive Peers index has lost more than one third of its value since the beginning of the year, partly spurred by Sessions’ move in January. Canada plans to legalize recreational use later this year -- following California’s steps to do so Jan. 1.

Ajamian believes U.S. cannabis producers “represent the next wave of outsized returns for investors” once the halo of legalization in Canada fades. Beacon calls Boehner’s appointment to Acreage’s advisory board a "bombshell" that may help "legitimize" the sector and generate investor interest.

To contact the reporter on this story: Kristine Owram in Toronto at kowram@bloomberg.net.

To contact the editors responsible for this story: Arie Shapira at ashapira3@bloomberg.net, Will Daley, Brad Olesen

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