This CBD Stock Could Benefit Greatly From Today's Elections

Demand for cannabis oils, particularly high cannabidiol (CBD) oil, continues to increase and this is a trend we expect to continue as researchers find out more about the therapeutic value cannabinoids provide.

During the previous year, the amount of countries that have legalized has significantly increased and this has been helping drive demand for CBD products. We’ve been closely monitoring this trend and have been identifying businesses that are poised to benefit from the increased demand.

When looking at companies that are levered into the CBD opportunity, it’s important to conduct significant due diligence on the company. Investors should be focused on businesses that have an attractive portfolio of high-quality CBD products, that are levered to emerging CBD markets all over the world, and that are led by a management team with a proven track record of success.

One company that meets this criteria is Tree of Knowledge International Corp. (TOKI.CN) (TRKWF). The company is in middle of a major growth cycle and has focused on increasing market share in CBD markets all over the world. Through EVR Brands, a subsidiary of the company, Tree of Knowledge has been capitalizing on the CBD opportunity and we’re positive on the growth prospects heading into 2019.

Tree of Knowledge commenced trading on the CSE during the summer and has come off its recent highs. We think the market underappreciates this opportunity and are tracking the way the team continues to execute. We are positive on Tree of Knowledge as a result of attractive leverage to burgeoning CBD markets, the continuing implementation, the growth potential, the management team, along with the evaluation.

A Global Development Story

One of the most important aspects of the company’s fundamental story is that the leverage to burgeoning CBD markets all over the world. During the previous year, EVR Brands significantly increased its reach and has been focused on building upon its current position in CBD markets all over the world.

EVR Brands is focused on entering new markets and we’re bullish on the company’s opportunity to do so. The company is in the early innings of a major growth cycle and has leverage to the CBD market in North and South America, Asia, and Europe. Over the next year, we expect to see that the company enter new markets and view this a potential catalyst for Tree of Knowledge.

Tree of Knowledge was focused on increasing market share all over the planet and benefits from getting an early mover advantage. This is an important feature of the story and EVR Brands has managed to capitalize on this advantage.

Although the CBD market in North America is in the early innings of a major growth cycle, the industry is fragmented and EVR is focused on increasing market share. The company has partnered with several large distribution groups that have started to gain market share and drive revenues. Canada represents a major opportunity and provides EVR entry to the world’s largest indoor increase, to a significant distribution network, and an R&D and teaching facility. We are going to monitor how this market develops over the next year and are positive on EVR’s place in it.

South America represents a significant opportunity for EVR which has been gaining market share in Argentina and Brazil, two of the largest markets in South America. In these markets, CBD products are prescribed by doctors after being approved through the government. This is not a simple process but EVR has been successful in both countries. We are positive on EVR’s position in these markets and will monitor how the company can increase its position going forward.

In Brazil, EVR is just one of 11 approved providers to the doctors 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 expects to generate approx. $1 million in earnings from these two markets and we anticipate 2019 should be even more important.

Although Asia represents a significant opportunity for CBD businesses, the sector is still in its infancy. China represents a major opportunity for EVR and the company expects to generate $1.5 million in revenue in China this year. EVR has a strategic relationship with a major distributor and expects to begin distributing 50,000 units a month by the end of the next quarter. We are positive on the growth potential and will monitor how this region adds value going forward.

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

Although Tree of Knowledge has significantly advanced its fundamental story, the shares have been under considerable pressure and have been trading lower with the market. The company’s leverage into the CBD market is important and we’re bullish on the growth prospects heading into 2019.

2018 has been a banner year for Tree of Knowledge and we anticipate 2019 to become even more important. Requirement for CBD products continues to rise, and we expect this trend to continue for the foreseeable future.

Tree of Knowledge is well positioned for growth and this is a company worth watching. To stay up to date with all the company, please email [email protected]

SBP continues to drive market awareness for leading firms in the cannabis industry throughout the U.S. and abroad.

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