Investing in CBD Companies

The buzz around CBD is not just limited to buying and using the product. Investing in CBD and cannabis related companies has become equally as popular. According to a recent report done by the BrightField Group, CBD is growing so rapidly that it has the potential to be a $22 billion industry by 2022.

Below we are highlighting three companies which have already built a solid foundation and are well positioned to be the leading producers and distributors of CBD products in the years to come.

Canopy Growth Corporation (NYSE: CGC)

Canopy Growth Corporation is the man among boys in the universe of cannabis companies. The Canadian based company is one of if not the dominant leader in the industry. As such, the company has been making huge strides in the U.S. and international CBD markets.

Last year, Corona and Modelo beers maker Constellation Brands invested $4 billion into Canopy Growth, the biggest partnership for a cannabis company to date. In January of this year, New York State granted a hemp licence to Canopy Growth allowing the company to establish operations in the state and build a facility for the production of various hemp-derived products.  The company also announced a high profile partnership with Martha Stewart to advise and develop a line of CBD products. In April of this year, Canopy Growth entered into an agreement to buy Acreage Holdings, one of the largest cannabis companies operating in United States. Lastly, Canopy Growth is conducting clinical trials of CBD-based anti-anxiety treatment for pets and expects to publicly announce products later this year.

Canopy Growth CEO, Bruce Linton views cannabis as being an impending disruption across multiple industries including big pharma and others such as the multi billion dollar sports nutrition market. As Linton stated in a recent interview, “CBD with a couple of other ingredients might make a very good sports recovery drink. Every sports recovery player should be in [cannabis].”

According to Linton, the company is in the perfect spot to capitilize on the booming CBD industry. “Canopy has been preparing for and investing in this opportunity for several years now, through strategic acquisitions, infrastructure expansion, and extensive internal research and development, ” states Linton. “With the door now open, we are moving fast to bring our considerable resources to establish the same market leadership position internationally that we have earned in the Canadian cannabis market. Canopy has a strong supply of CBD, a significant channel presence, the IP to drive the CBD industry forward to the benefit of consumers, and the balance sheet needed to act now. “

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“Canopy has been preparing for and investing in this opportunity for several years now, through strategic acquisitions, infrastructure expansion, and extensive internal research and development … Canopy has a strong supply of CBD, a significant channel presence, the IP to drive the CBD industry forward to the benefit of consumers, and the balance sheet needed to act now.”

Bruce Linton, CEO Canopy Growth

In addition to its North American interests, Canopy Growth has also been building out its international footprint including investments and acquisitions in Germany, Denmark, and Australia to name just a few.

Overall, Canopy Growth is well positioned to be a global leader in the cannabis industry and the long term outlook as a dominant producer and distributor of CBD products is looking very bright.

Charlotte’s Web Holdings, Inc. (OTCQX: CWBHF)

Charlottes’s Web Holdings has been a leader in the industry since being founded in 2013 and became well known after a CNN documentary based on the life of a little girl named Charlotte Figi. Charlotte suffered from up to 40 grand mal seizures per day brought on by Dravet syndrome. A group of local brothers who were marijuana growers and dispensers from Colorado heard about her story and created a special strain of cananbis oil as a treatment for her condition. This strain worked so well on stopping this little girl’s debilitating seizures, that the brothers decided to change the name of the strain and ultimately founded the company with the name Charlotte’s Web in honour of her.

Unlike Canopy Growth, Charlotte’s Web Holdings is already a profitable company producing CBD in the U.S. and the world’s leading CBD brand by market share. The Colorado based company currently has its products, which includes CBD oils, capsules, creams and pet products, on the shelves of more than 6,000 retail locations including some national grocery and pharmacy chains. Additionally, Charlotte’s Web Holdings has a booming e-commerce business which drives over half their sales.

For the remainder of 2019, Charlotte’s Web Holdings is focusing on additional retail expansion as well as looking into global expansion in Latin America and Europe.

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Curaleaf Holdings, Inc. (OTCQX: CURLF)

Curaleaf Holdings, Inc. is currently the largest MSO, or multi-state cannabis operator, by market cap, in the U.S. The company operates operates in 12 states with 44 dispensaries, 12 cultivation sites and 11 processing sites. The company recently opened it’s 24th dispensary in the state of Florida which is becoming one of the fastest-growing medical and cannabis markets in the country.

The U.S. market for CBD is still very much in its infancy but Curaleaf has been making strategic moves to gain a competetive advantage over its peers.

Last fall, Curaleaf announced the launch of a new CBD consumer line of products, Curaleaf Hemp. The Curaleaf Hemp product line includes CBD oil drops, lotions, soft-gel capsules, patches and disposable vape pens. This was then followed by an accouncement in March of this year that Curaleaf had signed a deal with CVS Health to sell their products in the popular drugstore chain. Further, the company just recently acquired the popular Select marijuana brand from Cura Partners, Inc for $950 million. Select is one of the most widely sold brands in California which is home to the world’s largest legal weed market. Further, Curaleaf recently entered the CBD pet market with a new line of products branded as Bido.

Curaleaf is certainly one of the more interesting U.S. MSOs to watch in the cannabis sector. So far the company’s stock has had a solid year, up 90% year to date.

Additional Resources

If you are interested in learning more about investment opportunities in the CBD and overall cannabis space, we would highly recommend checking out the 4 part series Bret Rosenthal of Rosenthal Capital Management has put together on his YouTube channel about investing in cannabis stocks. I’ve linked to part 1 of the series below.

Bret is a seasoned investment professional with over 30 years of experience. This series as well as his weekly podcasts are truly insightful and well worth your time.

If you prefer your information in print, we also recommend these two beginner books on investing in the cannabis space.

Mickey Dee’s Investing in Medical and Recreational Cannabis: Buy in Before, During and After Legalization and Peter Hatcher’s International Marijuana, 2018 Edition: The No B.S. Guide to Investing in Weed Stocks Globally are two highly reviewed and easy to read books which provide step by step guidance regarding cannabis investment opportunities.

 

Disclaimer: The views expressed represent the opinion of CBD Men’s Lifestyle. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Users should consult with appropriate advisors before making investment decisions.

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