Wall Street Firm: Big Tobacco Should Start Thinking About Marijuana

The esteemed Wall Street firm RBC Capital Markets apparently has some advice for major tobacco companies: Start thinking about marijuana, because it’s probably not going anywhere.

That’s the gist of a research note that was being circulated and wound up in the hands of Business Insider. The RBC analyst who wrote the memo pointed out several political factors that suggest marijuana legalization isn’t just a fluke, but an ongoing trend that’s likely here to stay.

“We believe it is only a matter of time until investors start asking questions about how it (marijuana) will fit into the bigger picture,” the memo reads. “And while every tobacco company management we have spoken to on this topic has been unwilling to discuss it, we believe full federal legalization of marijuana in the US would likely lead tobacco companies to reconsider this space.”

The memo points to recent polls that have found a majority of Americans now favor legalizing marijuana, and that it’s also a generational issue, with 69% of millenials backing full legalization. And that sector is only going to get older, wealthier, and start voting more as the years progress. The memo even suggested marijuana could be a “critical topic for the 2016 presidential election.”