The problem with some of Seeking Alpha articles is that they generalize the sector.
While I agree that some of the MMJ stocks probably are overvalued and lack company fundamentals but I also believe that several of them are very undervalued and some are already reporting company fundamentals to meet listing requirements.
Right now, essentially all the MMJ stocks are OTC/Pink sheet but many will go significantly higher (multiples) over the next 3, 6, 12, 24 months as medical and recreational MJ legalization widens (and mark this post as this WILL happen moving forward).
It is true that many MMJ stocks simply can't justify the valuation but that's not what's driving the price increase right now. What's driving the price increase is the future potential of the company in terms of revenue growth. Some of current OTC/pink sheet MMJ stocks will be improving fundamentals and revenue in the future and may get listed on Nasdaq/AMEX boards.
Of course, difficulty for us investors/traders/swing traders/trend traders/day traders is identifying which company will go up by 25-50% and which will double/triple/quadruple or more in the near future. The problem with some Seeking Alpha articles is that they mention the general risk involved with MMJ stocks but don't try to separate out select MMJ stocks that have solid fundamentals from those that don't.
Stock manipulation/short selling as well as hype/pump & dump, especially with OTC/pink sheet stocks is a sad reality but also benefits swing/technical traders like me to realize huge gains from buying on dips and selling on highs, it's just that right now with MMJ stocks, the frequency in which the highs/lows occur is much narrower than usual.
So in the near term, when you realize significant gains, I suggest you take profit and buy back on dip. If you have any concerns, buy back with the gains. If you are confident, buy back all so when you finally exit the trade, you end up with MUCH more shares.
