Flower Market: Plant Stocks In 2026
U.S. plant-touching equities closed 2025 with real momentum. The ETF (MSOS) outperformed the S&P 500, and December accelerated things further after President Trump issued an executive order pushing the DOJ to fast-track rescheduling to Schedule III.
The biggest immediate impact is tax relief. Under current law, operators are crushed by 280E, which prevents them from deducting basic business expenses like payroll and rent. They’re taxed as if they were traffickers, not regulated businesses. Rescheduling should eliminate 280E going forward, potentially changing balance sheets overnight. What’s still unclear is how quickly that relief arrives and whether past tax liabilities are addressed.
That uncertainty is why caution remains. Investors in this space have been burned repeatedly—banking reform stalls, legislation dies at the finish line, and promises fade. Rescheduling doesn’t automatically unlock banking access, major exchange listings, or clear federal guidance on adult-use programs. Those are likely separate steps, each with its own timeline.
MSOS stands out as the largest and most liquid U.S. plant-touching ETF, actively managed rather than index-based. That matters in a distorted market where size doesn’t always equal strength. The fund leans into established operators while keeping exposure to smaller names that could benefit most from federal reform.
Heading into 2026, the takeaway is straightforward. Tax relief is the first real win. Banking and listings are the real endgame. The room still smells like uncertainty—but for the first time in a long while, the lights are on.
