3 Stocks Ready To Ride The CBD Wave

3 Stocks Ready To Ride The CBD Wave

The CBD market represents one of the most exciting growth opportunities and we’ve been closely monitoring this emerging sector.

Requirement for CBD products continues to increase, and we believe this a trend that will become even more pronounced. During the last two decades, we believed it to be an emerging marketplace and have been very focused on the CBD market. A lot has changed in the past two decades and the CBD market is a market with growth potential.

Last week, the United States Food and Drug Administration (FDA) rescheduled GW Pharmaceuticals’ (GWPH) Epidiolex merchandise to Schedule V. The CBD product treat patients that are suffering from seizures as well as the approval represents a major milestone for the cannabis industry.

CBD is derived from cannabis and is the second best known chemical compound in the plant (THC is the best-known compound). The cannabis plants offer amazing benefits that are therapeutic, and this has been one of the factors behind the demand for CBD products.

Although there are a lot of organizations claiming to be greatest and largest CBD company, investors will need to be careful and conduct due diligence. We have highlighted three companies that are capitalizing on the burgeoning CBD industry and have been watching this business.

Phivida Holdings (VIDA.CN) (PHVAF) has been laser focused on the burgeoning CBD marketplace and has been executing flawlessly on this.

Last month, Phivida announced a major milestone with the launching of its Oki brand that’s a new line of functional beverages and supplements that are infused with Active Hemp Extract and will be available to customers in up to 2,400 natural specialty store locations within the USA.

The bottling production run of Oki products was 100,000 units, with an additional 150,000 presently scheduled. Distribution is intended to a broad assortment of retailers throughout its exclusive national agreement with Natural Specialty Sales (NSS), which has a national network that includes major retail banners such as Whole Foods Market, Sprouts Farmers Market, and National Co-op Grocers.

In August, Phivida and WeedMD Inc. (WMD.V) (WDDMF) formed a joint venture named Cannabis Beverages Inc., which is focused on manufacturing, marketing and distributing cannabinoid-infused drinks for the medical and future adult-use cannabis markets.

Phivida is levered to two major growth opportunities in CBD the cannabis sector and products. The business has been laser focused on growth and we are monitoring the team continues to execute. The launch of the Oki brand and the joint venture with WeedMD are growth drivers for Phivida and this is a company. 

LiveWell Canada: A High-Quality Cannabis Company

During the summer, LiveWell Canada (LVWL.V) commenced trading on the TSX Venture Exchange and we’ve been positive on this cannabis opportunity. LiveWell is in the middle of a major expansion, and it has secured strategic partners in Canopy Growth (WEED.TO) (CGC) and Canopy Rivers.

For the past several decades, LiveWell has been quietly building a platform to capitalize on the CBD opportunity which it has unveiled. The business is an early mover in this market and this is beginning to pay off.

Last month, LiveWell signed its first CBD supply agreement in Brazil for at least 5,000 kilograms annually in US$7,000 per kilogram during the next 12 weeks (US$35m revenue).  This is the CBD supply agreement we’ve are positive on this agreement that contains annual renewals for up to five decades and seen from any business. The agreements represent 20 percent of the first CBD supply to be extracted from the hemp biomass secured by LiveWell. The business is in discussions regarding the balance of its CBD supply and we expect to hear more announcements shortly.

LiveWell recently secured 1,000 acres of Canadian industrial hemp biomass for the purpose of extracting and producing cannabinoids (including CBD). Utilizing extraction technologies the company anticipates extracting 25,000 kg of CBD isolate.  This was a buy that is strategic and it’s already paying dividends to the corporation. As part of the agreement, LiveWell has an option to get an acres of hemp biomass that is Canadian and we expect to find this option exercised.

In the product’s market value, LiveWell trades at roughly 1x 2019 revenue. LiveWell is undervalued when compared to its peers and we believe the market significantly underappreciates this opportunity. The business has massive growth potential, has secured among the greatest partners, and is focused on expanding into new markets. This is a company to watch!

One company we’ve been closely watching is Tree of Knowledge International Corp. (TOKI.CN) (TRKWF). During the month, the business has been trending higher and we’ve been monitoring this. Tree of Knowledge is in the middle of a growth cycle and has leverage to the CBD market in North and South America, Asia, and Europe. Tree of Knowledge benefits from getting an early mover advantage and this is an important feature of the story.

Although the CBD market in North America is in the early innings of a growth cycle, the market is fragmented and EVR is focused on increasing market share. The business has partnered. Canada offers the world & rsquo; s largest grow EVR access, to a distribution network, and an teaching and R&D facility and represents a major opportunity. We are currently going to track how this market are positive on rsquo & EVR and develops over the next year ;s place in it.

South America represents a substantial opportunity for EVR that has been gaining market share in Brazil and Argentina, two of the largest markets in South America. After being approved through the government in such markets, doctors prescribe CBD products. This is not an easy process but EVR has been successful in both countries. We are positive on EVR’s will track how the company can increase its position and position in these markets. To the doctors, EVR is one of 11 approved providers in Brazil and is the very well-known and requested CBD product line. In Argentina, EVR is one of only two approved supplies. In 2018, the company hopes to generate approx. $1 million in earnings from both of these markets and we expect 2019 should be even more significant.

The sector is still in its infancy although Asia represents a substantial opportunity for CBD companies. EVR has a strategic relationship with a distributor and expects to start distributing 50,000 units by the end of the next quarter. We are positive on the growth potential and will track how this area adds value.

EVR has entered the market through Ireland and the company plans to expand during the next year. EVR plans to increase market share in Europe through its operations and we are monitoring this opportunity. In 2018, EVR hopes to generate $1 million in earnings and this part of the company can prove to be very significant, whether the company can expand into new markets.

Tree of Knowledge has been trending higher and we are tracking the current move higher. The business has significant growth potential due to the attractive leverage to burgeoning CBD markets and we are monitoring the team continues to execute.

Published at Tue, 02 Oct 2018 11:38:46 +0000

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