#Hemp #Stocks /US Hemp Industry Booms During Pandemic
(OTCQB: $SING) (OTC: $HEMP) (TSX: $CWEB.TO) (OTCQX: $CWBHF) (TSX:
$ACB.TO) (NYSE: $ACB)
Point
Roberts WA, Delta, BC – May 29, 2020 – Investorideas.com, a leading investor
news resource covering hemp and cannabis stocks releases a special snapshot
reporting on the continued growth in sales and product offerings in the US hemp
industry and how this traction is beginning to attract outside investment.
Earlier
this month, SinglePoint Inc. (OTCQB:SING) started
their Q2 with
strong numbers achieving over $1,000,000 in sales throughout Q1 a 309% increase
and a focus on continued growth. After evaluating reports for Q2, SinglePoint’s
Hemp vertical has been on track to double sales in its second quarter alongside
the launch of 1606 Hemp six-pack counter top display. 1606 Hemp has seen a
sales growth rate of 133% this quarter over the previous, a 233% growth in
sales up to this point of the month compared to the previous month at the same
point. The company has placed a focus on
self-generated in-store placement by hiring professional sales representatives
to acquire new stores for the sales of its products over the next four weeks.
1606’s goal is to grow by more than 250 retail accounts throughout multiple
states, which the Company surpassed in the first couple weeks by placing
product in over 400 stores throughout 20 states.
According
to management, stores are selling through product quickly and many have already
reordered additional 1606 Hemp inventory.
As
the company continues to see success, management believes 1606 Hemp will be
able to provide approximately $2,750,000 to $5,500,000 in revenue selling to
just 1,000 stores. “As the roll out is
successful and we achieve our goals over the next four weeks, 1606 Hemp will bring
on additional individuals to scale up to as many as 2,500 stores as quickly as
possible in order to achieve reorders from 1,000 stores. Management believes
the current total addressable market is approximately 125,000 locations or
more.”
“I've been trying
to get friends and family to make the switch to hemp for years, your product is
changing a lot of hearts. Thank you”
-
Al, 1606 Hemp Customer
1606
Hemp is working to become the leading recognized brand in the combustible hemp
market which is the second fastest growing market in the hemp category. The big
differentiator for 1606 Hemp is the ability to place a countertop display unit
at retailers across the nation. “While others are working to dominate the
online market, we have a general belief this type of consumable product will
continue to be bought in convenience stores, smoke shops and bodegas throughout
the nation.” However, the company provides an amazing online experience for
consumers to purchase 1606 Hemp and has amassed an online following through
social channels reaching over 17,000 followers on Instagram and driving traffic
to its online site at 1606Hemp.com
BDS
Analytics and Arcview Market Research project that the collective market for
CBD sales in the US will surpass $20 billion by 2024 while New York-based
investment bank Cowen & Co, estimates that the market could pull in $15
billion by 2025. The combustible hemp market currently represents approximately
2% of the overall CBD market, but with a 250% growth from 2017 to 2018,
Brightfield Group, a Chicago-based cannabis market research firm, identifies
dried and combustible hemp flowers as one of the fastest-growing segments of
the CBD market. With the passage of the
2018 Farm Bill and the mainstreaming of CBD hemp, the market is growing
rapidly. There is a significant need for reliable suppliers with the capacity
to move products.
Hemp, Inc. (OTC:
HEMP) has
also been showing strong growth, having announced
recently that
sales to date from their premium hemp flower, Pre-98 OG Bubba Kush, have
surpassed their $1,000,000 groundbreaking milestone. The Company has reached $1,035,817.04 (up
$55,000 from sales reported in its last press release). That’s a total of
$1,035,817.04 over the past ten weeks and six days ($265,200 during the first
quarter and $770,617.04, to date, in the second quarter). The Company expects
to hit groundbreaking milestones each week (maybe even $1,000,000 a week) due
to the explosive demand for its high quality hemp flower. The premium Pre-98 OG
Bubba Kush is just one of the many bio-diverse hemp products the Company
produces, among hemp for bioplastics and LCM (Lost Circulation Material).
Hemp, Inc.’s CEO, Bruce Perlowin, admits it
was very frustrating and full of delays with sales for about two months due to
the COVID-19 pandemic but says the Company is now ‘full speed ahead’. “Our Pre-98 OG Bubba Kush hemp flower is
exploding. We’re in full swing and are
on track to be able to sell our King of Hemp™ pre-rolls in all 50 states. We’re
also beginning our mass marketing campaigns so I’m certain we will have revenue
in the millions to report for the second quarter and beyond. At this point, I
wouldn’t be surprised if we hit $1,000,000 weekly. It’s definitely possible.”
Hemp Inc has bi-coastal processing centers,
including the 85,000 square foot multipurpose industrial hemp processing
facility on 9 acres in Spring Hope, NC, a 55,000 square foot state-of the art
local processing center in White City, Oregon, a 500-acre hemp growing Veteran
Village Kins Community in Golden Valley, Arizona, two model “Small Family Hemp
Farms” in North Carolina and Arizona, a pre-roll blending manufacturing
facility in Las Vegas, NV, and a 5,000 square-foot retail store (The King of
Hemp Store™) in Kingman, Arizona, Hemp, Inc. has a few more infrastructure
footprints to create but other than that, it’s full speed ahead for the
Company.
Charlotte's Web (TSX:CWEB) (OTCQX:CWBHF), one of the most
well known CBD companies in the US, has also achieved another milestone in its
continued commitment to innovation and consistency in hemp genetics. The
Company has earned US utility patent U.S. 10,653,085, its second US patent for
hemp genetics. This patent is for 'CW1AS1', a new hemp variety created by
company co-founder Joel Stanley and Sr. Director of Cultivation R&D, Bear
Reel. The patent takes Charlotte's Web's
premier proprietary genetics to the next generation, and builds a strong wall
of protection around it, and the products made from it.
"This
'CW1AS1' patent gives Charlotte's Web the highest level of protection for our
proprietary genetics and ensures that Charlotte's Web products will continue to
be available to the thousands who use them in a form that is consistent and
provides the same user experience time and time again," said Deanie
Elsner, Charlotte's Web CEO and President.
Patents
on hemp genetics are a new frontier, and very few patents in this sector have
been issued to date. Charlotte's Web,
the world's largest vertically integrated hemp company, has been at the
forefront of this new frontier in hemp patents and will continue to invest in
its breeding program and in the science of hemp to ensure a consistent and
high-quality supply is available.
"This
patent recognizes the progress our breeding program has made to assure our
farmer partners that the plants they grow will yield better and have a high
level of phytocannabinoids," said Reel.
Charlotte's
Web's flagship Original Formula was the first CBD wellness product to be sold
nationally to consumers. Before Charlotte's Web was officially founded in 2013,
there was a waiting list of more than 15,000 individuals for Original Formula,
which uses the same proprietary phytochemical profiles produced by the now
patented 'CW1AS1' hemp variety.
Aurora
Cannabis
(TSX:
ACB)(NYSE:
ACB)
has seen a massive stock jump in the last few weeks, climbing more than 30 per
cent last Thursday following the announcement of a deal to expand the company’s
reach south of the border.
The Edmonton-based company is set to
acquire all issued and outstanding membership interests of the
Massachusetts-based CBD brand Reliva for US$40 million. The deal also includes
a potential earn-out of up to US$45 million in cash or stock based on
performance.
Aurora
Cannabis Inc. and Reliva, LLC announced that they have
entered into an agreement pursuant to which Aurora will acquire all of the
issued and outstanding membership interests of Reliva. Under the terms of the
agreement, members of Reliva will receive approximately US$40 million of Aurora
common shares. The transaction also
includes a potential earn-out of up to a maximum of US$45 million payable in
Aurora shares, cash or a combination thereof, over the next two years contingent
upon Reliva achieving certain financial targets. The structure of the earn-out
is designed to align risk and reward between Aurora shareholders and Reliva
management to focus on continued strong operational and financial execution.
The transaction is expected to close, subject to customary closing conditions,
in June 2020. It is anticipated that the transaction will be immediately
accretive to Aurora on an Adjusted EBITDA basis, consistent with
Aurora's
objective is to drive towards Adjusted EBITDA profitability in its fiscal first
quarter of 2021. The transaction will combine Aurora's leading Canadian
recreational brands, and Canadian and European medical market position with the
leading U.S. hemp-derived CBD brand in retail stores. Consistent with the
announcement of Aurora's business transformation plan in February 2020, the
Company has aligned its US investment strategy with the goals of the
transformation plan, namely: financial discipline, operational focus, and
strong execution. The transaction represents the culmination of a multi-month
strategic evaluation of the US hemp-derived CBD industry. Reliva stood out
among a lengthy list of potential partners for its: (1) focus on regulatory,
testing and compliance protocols; (2) proven management team with extensive
experience selling and marketing regulated consumer packaged goods; (3) deep
relationships with critical trade partners that provide a US national
distribution footprint; and (4) financial discipline and track record of growth
and profitability. Together with Reliva, Aurora is expected to be positioned as
a meaningful player in the United States, the world's largest cannabinoid
market.
Aurora said it expects the American CBD
market could reach US$24B by 2025. However, the company’s move south comes at a
time of regulatory uncertainty following the federal decision to loosen
restrictions on hemp production two years ago.
The US Food and Drug Administration is
treading a cautious path. Currently companies are not allowed to add CBD to
food, drinks or cosmetics. The agency has been cracking down on companies that
do so. That hasn’t stopped a wide range of edible and beverage products
targeting wellness-minded consumers from gaining mass popularity.
“The consumer CBD industry faces temporary
challenges in the U.S., but the industry has long-term upside, valuations have
pulled back, and we think Reliva has a unique channel and price positioning
that allowed it to perform quite well pre-COVID,” Cantor Fitzgerald analyst
Pablo Zuanic wrote in a note to clients on Thursday.
“Aurora has the ability to start building
its infrastructure out to capitalize on the potential for a more benign FDA
environment on CBD and THC legislation that makes it federally permissible to
operate domestically,” Cowen analyst Viven Azer wrote in a research note.
As more companies continue to see strong
sales, high consumer demand and focus more on premium high quality products,
there is no doubt that CBD/hemp will continue to flourish, even amidst
regulatory uncertainty.
Research
more cannabis stocks with the investor ideas stock directory
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