The cannabis industry comprises several companies that either support or engage in the research, development, and distribution of medical and recreational marijuana. Like CBDfx UK, there are several other CBD or cannabis supporters and distributors. In the past decade, cannabis has gained a much wider acceptance globally. As more nations and states legalize the use of cannabis for recreational and medicinal purposes, it has also become more popular in the stock market.
Some of the biggest companies in the cannabis industry include Canopy Growth Corp. (CGC), Charlotte’s Web Holdings (CSE: CWEB), and Cronos Group (NASDAQ: CRON). However, many of these big marijuana company names continue to post sizable net losses due to investments in equipment to help speed up revenue.
Marijuana stocks continue to underperform dramatically in the broader market as investors record losses. Still, amidst the current situation and economic downturn, some marijuana stocks show a lot of promise and have the best value, and fastest sales growth.
We delved into three of the most promising CBD stocks to invest in 2020. Here’s what you need to know:-
Canopy Growth (CGC):
Canopy Growth has managed to hold its position even with the current economic slowdown. Canopy Growth’s products show a lot more promise in grabbing shelf space. The company could also use its balance sheet to purchase other struggling players in the industry at a much lower price.
At $14.50, Canopy Growth has a market cap of $5 billion and FY21 revenue estimates of over $500 million. When the company originally forecasted its 2020 sales, which topped $1 billion, the USA CBD market seemed a more distracting move. With the sudden removal of the FDA restrictions, it seems that Canopy Growth could make its CBD products its prime revenue generator.
Canopy Growth’s stock was already a promising buy in the low teens and proved to be a big boost in the CBD space. In the right conditions, these moves should see Canopy Growth magnify its market opportunity. For one, this company has far more capital to enable it to thrive through an extended tough regulatory environment. Canopy Growth is a stock with a lot of potential and one that’s worth watching out for.
Charlotte’s Web Holdings (CSE: CWEB)
Charlotte’s Web Holdings (CWH) is the clear independent leader to consider for investors looking for the ultimate signal and want to invest in healthy CBD stocks. CWH only just hit a 52-week low with stocks going as low as $3 in March.
Charlotte’s Web Holdings currently has a market cap just below $500 million, while its original sales goal for 2020 was $350 million. The latest analysis forecast for its 2021 sales shows it topping the $500 million mark. It makes CWH the best and ultimate stock in the industry today.
Investors looking for any signs of health in the CBD stock sector will have a much better chance of checking for a boost in CWH’s stock price and its quarterly results. The acquisition of Abacus Health Products gives CWH access to over 15,000 unique retail doors. Not to mention another 16,500 health provider offices that CWH can utilize to expand its distribution and consolidate its market leadership.
The company needs to wait for the FDA to clear up the regulatory uncertainty surrounding food products. Should this happen, the business will soar, and CWH’s stock prices will skyrocket. Currently, CWH’s stock is at $4 with the potential to shoot to an average price target of $7.31. It seems the perfect time to look into Charlotte’s Web Holdings stock to smile at the bank at the end of the day.
Cronos Group (NASDAQ: CRON)
Cronos Group is one of the leading global cannabinoid companies holding international production and distribution in five continents. Its stock is also one of the most widely traded shares across the cannabis space.
Cronos got into partnership with Altria in November 2018, where Altria invested $1.8 billion for a 45% stake in Cronos. Altria’s partnership opened several investment opportunities for Cronos as it invested in global distribution, experience, and knowledge of CBD stocks. Currently, Cronos Group ranks as one of the leading distribution platforms in the CBD regulated industry.
The company’s 2019 Q3 results showed revenue growth of 24%, driven by the high volume of cannabis sold. Cronos produced 3,142 kilograms of cannabis. Following on from its Altria deal, Cronos had recorded almost $1.4 billion on its balance sheet this quarter. It made Cronos Group the second most capitalized company globally, only behind Canopy Growth that attributes its success to its Constellation deal.
Whatever the case, Cronos is still the best stock to invest in as investors see potential in its wide range of CBD products. Not only that, but Cronos’ decision to focus on its cannabis extracts and derivatives makes it the most viable stock option to consider. The company recently stated that it would start purchasing its CBD products wholesale to focus more on R & D, production, and brand creation.
It’s safe to say that Cronos isn’t going anywhere any time soon. It makes Cronos our third and best CBD stock to keep an eye out and invest this year.
The Bottom Line
From what the stats and figures show, it’s evident that the cannabis sector and market is a real and existing one. As one of the most promising stock opportunities in the industry, CBD stock is here to stay. You should still invest time and research before deciding which CBD stocks show the most promise this year.