2018 has been quite the year for Canada’s marijuana sector.

The majority of pot stocks are up substantially, largely based on a nice first half of the year. Investors who sold in August or September did pretty well, and the sector surged to an all-time high in early October right before the drug was officially legalized.

It seems like legalization day was the turning point, since Canada’s largest marijuana companies have gotten absolutely hammered since, falling anywhere from 30% to 60%. A number of different issues have hit the sector hard, including reports of consumer shortages, attacks from short-sellers, and a general stock market decline.

Simply put, investors just aren’t as excited about the future of pot as they were before.

Canada’s Prime Minister says legal pot supply issues to be sorted out in months

In case you hadn’t heard, there’s a supply shortage of legal cannabis in Canada and the prime minister is on the case. While noting the dearth of legal weed in Canada “will take a little time to adjust,” Prime Minister Justin Trudeau blames the delays on municipal governments and others who have been more critical on pot legalization. Expect some relief in the coming months but Trudeau is quick to point out the industry is on the right track to get legal pot into Canadians’ hands as swiftly as possible.

A game changer for the cannabis industry is quietly being pushed through the U.S. political system. It’s something that’s barely getting any media attention, but could be a much bigger boon to cannabis producers than this year’s ill-fated legalization drama.

What I’m talking about is the federal-level legalization of hemp in the U.S.

Marijuana 1.0 was all about the legalization drive, the dumping of billions of dollars of cash into the industry and mouthwatering mergers and consolidations-but it was a jockeying exercise in capacity expansion. Mentioned in today's commentary includes:  OrganiGram Holdings (OTCQX:OGRMF), Curaleaf Holdings (OTCPK:CURLF), Emerald Health Therapeutics (OTCQX:EMHTF), Auxly Cannabis Group Inc. (OTCQX:CBWTF), CannTrust Holdings Inc. (OTCMKTS:CNTTF)

Marijuana 2.0 could be just as big a deal-it's about the technological tweaks that will actually make this industry profitable. It involves Big Data, AI, automation and a host of other tech tweaks that will increase profitability and open up vast new markets in key verticals.

OrganiGram Holdings Inc. (OTC: OGRMF) (TSXV: OGI), announced their fourth-quarter and fiscal year operating results on Friday morning, presenting impressive sales increases in the past year. The results end August 31 meaning their reported achievements do not include post-legalization revenue. It implies that investors can expect additional revenue increases in future quarters.

The Canadian business world is the playing ground for a new David and Goliath battle. Cannabis is the relatively small, upstart industry coming into the game, fresh off of its recent legalization of recreational use.

The alcohol industry serves as the perfect Goliath, with Canadian annual sales ringing in at $22-billion dollars a year. In comparison, Statistics Canada estimated the annual spending on cannabis was $5.7-billion dollars last year. With more Canadians indicating that they are willing to consume cannabis now that it’s legal, the question is whether alcohol sales over the holidays be impacted?

Two months after recreational cannabis was legalized, Canada’s new pot regime is still working out kinks in the supply chain and the enforcement of new rules.

Before the cannabis legislation came into force, the federal government listed its key objectives for the historic shift. Those goals include keeping cannabis “out of the hands of children and youth,” curbing illegal marijuana sales, and ensuring a safe supply of quality pot across the country.

More than 60 days after the first legal cannabis sales were made on Oct. 17, are those objectives being met? CTVNews.ca takes a look at how reality measures up against some of the government’s main promises.

You've probably heard a lot about Tilray (NASDAQ:TLRY) this year. The Canadian marijuana stock has more than quadrupled since Tilray conducted its initial public offering in July. But there's another marijuana stock that you might not have heard of at all that's as intriguing as Tilray. That stock is Innovative Industrial Properties (IIP) (NYSE:IIPR). Tilray's market cap is nearly 18 times greater than IIP's market cap. So far this year, Tilray stock's performance is much better than IIP stock's 50%-plus gain. But which of these two marijuana stocks is the better pick for the future?

The marijuana industry has come an incredibly long way in a short period of time.

During the mid-2000s, just a third of all Americans polled by Gallup favored the idea of legalizing marijuana on a national level. As of 2018, 2 out of 3 Americans now favor such a move. This favorability toward pot is a big reason we've witnessed an increase in state-level legalizations. Following midterm elections, 32 states have now given the green light to medical marijuana, with 10 of those states also allowing adult-use weed.

Legalization of cannabis at the recreational level in Canada on October 17, 2018 marked a turning point for the cannabis sector worldwide. While the Canadian market is estimated to be worth several billion dollars in a few years, the market may eventually become saturated as millions of square feet of production capacity comes online. Once this happens, production capacity could exceed domestic demand, which would likely drive down prices and margins. If this theory holds true, cannabis companies that are ready to take advantage of opportunities in the face of a shifting global landscape will be the ones that deserve higher valuations. As such, the three Canadian marijuana stocks we have identified may be the ones that rise to the top in the coming years.