Although the cannabis sector has been in a prolonged slump over the last few years due to the absence of federal reforms, President Trump’s recent comments on marijuana rescheduling have reignited optimism in the sector — sending share prices soaring.

A potential reclassification at the federal level could be transformative — easing punitive tax burdens, improving access to banking services and paving the way for broader medical and recreational adoption. Such a structural shift could help revive an industry that is expected to surpass the $160 billion mark by 2032.

In this context, we examine three companies — Village Farms International (VFF Quick QuoteVFF - Free Report) , Canopy Growth (CGC Quick QuoteCGC - Free Report) and High Tide (HITI Quick QuoteHITI - Free Report) — that could prove to be valuable additions to your portfolio. We'll analyze why each of these companies, either carrying a Zacks Rank #1 (Strong Buy) or 2 (Buy), is an interesting prospect to watch.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Village Farms International

Currently sporting a Zacks Rank #1, Village Farms stands out as one of the few cannabis operators consistently generating positive EBITDA and cash flow from its cannabis operations. In its Q2 earnings results, the company noted the strong performance in international medical export sales that jumped 690% year over year.

Village Farms’ strategic decision to divest its fresh-produce business — a lower-margin segment — has allowed the company to focus on higher-margin cannabis operations. It has retained its position as one of Canada’s top three cannabis players while streamlining its retail portfolio. Additionally, the company began commercial shipments to the Netherlands in early 2025, contributing $2.4 million in incremental Q2 revenues.

Estimates for VFF’s 2025 EPS have improved from a loss of 9 cents to earnings of 12 cents in the past 30 days. During the same timeframe, EPS estimates for 2026 have risen from 6 cents to 14 cents. The stock has skyrocketed nearly 274% year to date, reflecting strong operational performance and renewed investor enthusiasm.

Canopy Growth

This Zacks Rank #2 company has been streamlining operations by exiting lower-margin businesses and selling non-core assets over the last couple of years in order to boost liquidity, reduce operating expenses and clear its path toward profitability.

A major catalyst for Canopy lies in its U.S. strategy. Through its Canopy USA vehicle, the company holds stakes in Acreage Holdings, Wana Brands and Jetty Extracts, giving it exposure to key U.S. recreational and medical cannabis markets. Should marijuana be rescheduled federally, Canopy could accelerate the commercialization of these assets, opening up new revenue streams and improving margins.

Estimates for CGC’s 2025 loss per share have narrowed from 57 cents to 50 cents in the past 30 days. During the same timeframe, loss estimates improved from 42 cents to 11 cents. Although the stock has fallen 55% year to date, signs of top- and bottom-line improvements should reassure investors about the stock’s growth prospects.

High Tide

Carrying a Zacks Rank #2 (Buy), High Tide distinguishes itself as one of Canada’s fastest-growing cannabis retailers. With more than 170 branded retail locations, the company has built scale in both brick-and-mortar (Canna Cabana) and online channels (like Grasscity.com and Smokecartel.com).

This diversified retail approach allows High Tide to capture value across the cannabis ecosystem, even amid pricing pressures in the Canadian market.

Estimates for HITI’s 2025 loss per share have improved from 5 cents to 4 cents per share in the past 30 days, while 2026 EPS has risen from 5 cents to 11 cents over the same timeframe. Shares of the company have risen around 9%, supported by a stronger operating performance and optimism about federal marijuana rescheduling.