I nearly fell out of my chair when I saw a pack of Marlboro (PM) marijuana cigarettes being promoted online.

As the story goes, Marlboro’s “M” series cigarettes are available in four states — Washington, Oregon, Colorado and Alaska.

And prices start at $89 per pack — say what?

Heck, I even saw the new Marlboro box design (see image to the right).

While it’s true that tons of venture capital dollars are pouring into the pot boom, the Marlboro story doesn’t add up.

For starters, most marijuana investments are junk.

Plus, if “Big Tobacco” had truly made such a monumental pivot, I’d know.

So are Marlboro “M” cigarettes real or a hoax?

And where is the “budding” marijuana industry going next?

Here’s what you need to know now.

Dial M For Misleading

The rumors about big tobacco companies selling marijuana cigarettes are more than 40 years old.

But never before in history has America been closer to legal pot — for medical and recreational use.

The retail marijuana industry is currently worth about $7 billion in the U.S. And GreenWave Advisors projects that the weed business will top $30 billion in value by 2021.

But don’t believe the latest fake news about Marlboro.

You see, Big Tobacco doesn’t need weed.

Believe it or not, tobacco industry profits are at a 10-year high.

According to Euromonitor International, the number of people who smoke cigarettes has declined every year in the last decade. But The Wall Street Journal notes that over the same period, Big Tobacco profits have nearly doubled.

And with electronic cigarettes sales to younger smokers soaring, Big Tobacco doesn’t even need to sell “joints” to stay relevant to a new generation.

To top it off, marijuana is significantly more regulated than cigarettes. And weed isn’t even legal at the federal level.

So no, Philip Morris and friends are not about to produce “M” cigarettes. They’re doing just fine without them.

A Race Between Industry Heavyweights

When you look at the future of the marijuana industry, it makes no sense to think that a bunch of Mickey Mouse pot companies will expand ad infinitum as the marijuana market goes national.

Taking pot national requires some grown-up skills. I’m talking about manufacturing, distribution, finance and effective cost management.

Those are all beyond the pay grade of the average pothead entrepreneur.

What you’ll see is a race between industry heavyweights.

Let’s take a deeper dive to see which industry is most likely to win…

Contender #1 — Big Tobacco: This industry has more than a century’s worth of experience packaging dodgy, health-destroying herbs in a convenient, addictive form and shipping them round the country.

But as Jonathan mentioned above, Big Tobacco doesn’t even need to enter the marijuana industry to stay afloat.

Plus, tobacco companies suffer from an enormous image problem.

If Big Tobacco got involved, the trial lawyers of America would pinpoint all the health problems of marijuana smoking — and sue the pants off the major players.

Then they’d divide the proceeds between themselves and dodgy politicians. It’s just not worth Big Tobacco’s trouble.

Contender #2 — Big Alcohol: This industry is more likely to succeed unscathed. Its product is almost as damaging as tobacco, but it’s managed to cultivate an upscale image of sophisticated consumption.

This ensures that enough of the elite partake, to prevent the legal system from extracting giant rents.

It could do the same for marijuana — branding it as an upscale indulgence. And charging a premium price for it along the way.

Alcohol companies would just need to acquire expertise on the production side, which is easier than finding the best marketing angle.

Contender #3 — Big Pharma: Big Pharma would have an obvious advantage if marijuana were legalized for medical uses alone.

In this scenario, Pharma could ensure a 10-year approval period by the FDA and 17-year patent protection. It would then be able to charge $1,000 per leaf.

Legalization appears likely to spread beyond medical uses, however, at which point the trial lawyers come into play again and extract rents based on the harm it causes.

Sure, Pharma could probably keep more of the profits than Big Tobacco, but there are still better ways for the industry to make money.

Verdict: My money is on Big Alcohol as the eventual industry dominator.

Stick to the Pharmaceutical-Grade Stuff

Millions have already gone up in smoke (terrible pun intended) chasing profits in the recreational pot boom. And millions more will follow in the coming years.

Even if I didn’t hold tight to personal beliefs that kept me from investing in such stocks, the fundamentals of many of these companies would send me running in the opposition direction.

For any seemingly legit opportunity, there are at least a dozen frauds.

Indeed, we’d be hard-pressed to find another corner of the market over the last few years that’s more plagued with dubious “get rich quick” schemes.

And the recent Marlboro hoax is a prime example of the type of chicanery that’s all too prevalent in the space right now.

I don’t wade into those waters in any industry. Period. I’m not arrogant enough to believe I can spot all the scams, so I just don’t take the risk.

Before you label me a complete prude, though, understand this: I’m not denying the potential medicinal benefits of cannabinoids. The scientific data are clear, particularly for epilepsy sufferers.

We’ve even parlayed this reality into profits for readers by recommending up-and-coming pharmaceutical players in the space like Zynerba Pharmaceuticals Inc. (NASDAQ: ZYNE) and blue chips like GW Pharmaceuticals PLC (NASDAQ: GWPH).

Bottom line: If you’re dead set on gaining exposure to the broader trend here, proceed with caution. There are more hoaxes than home runs.

The best bet is sticking to highly regulated, more predictable pharmaceutical companies.

Plus, while I don’t recommend blindly investing in pot stocks, here’s something I do encourage you to “gamble” on.

I call it “America’s $1 Lottery.”

Odds of “winning” are 548,535% better than a traditional state lottery… a new winner is crowned each Monday… and next Monday’s “jackpot” could be as big as $74,666.