October 17, 2018 was a revolutionary date for the pot market. This is the date when Canada legalized recreational marijuana use among adults and pot stocks turned into gold. It didn’t take long for the big players to show up on the market. Canopy Growth Corp has been one of the leading companies for years now. They handle everything from product and process innovation to market execution. They were pioneers in a lot of ways. It was the first company to publicly trade marijuana products in North America and to introduce the now accepted concept of Compassionate Pricing to make medical cannabis affordable for patients. Canopy Growth Corp was also the first to offer Mainpro-M1 accredited continuing medical education programs to Canadian physicians, and to launch in-person assistance through their Tweed Main Street locations. Tweed was also the first Canadian producer to export dried cannabis to Germany. And most importantly, Canopy Growth Corp was the first cannabis company to strike a deal with Fortune 500 beverage alcohol supplier and to be listed on the New York Stock Exchange.
Their platform includes both greenhouses and indoor growing. Currently, Canopy Growth Corp is the only cannabis company to be a member of a major global stock market index, in this case the S&P/TSX Composite index.
The list of their accomplishments goes on and on and this already makes them a very reputable company. However, to make a big investment decision, let’s have a closer look at the numbers.
Canopy Growth Corporation (CGC) (Market Cap: $14.558M, Share Price: $42.49) has 4.3 million square feet of already licensed cultivation space. With the scheduled expansion to 5.6 million square feet capacity, the company is on the way of being able to produce 560,000 kilograms annually.
The company has operations in 11 countries across 5 continents.
To put it simply, Canopy Growth Corp is currently the world’s biggest medical marijuana company. It operates 10 licensed pot production farms and 4 Tweed Main Street locations in Ontario. The company keeps going on a positive track and increasing its value with years. Just over the past 3 month it has almost doubled its value. Another huge rise is expected as CGC is closing another big deal with a U.S. based hemp company, ebbu, LLC. The deal will be completed by CGC paying CA$25.0 million and issuing 6,221,210 common shares to ebbu in exchange for ebbu’s assets. The assets will take the company even further as they include ebbu’s progress and specialization in the purification and study of cannabinoids for product development, wholesale, and research purposes. This includes the use of plant genetics to maximize cannabinoid output via plant breeding.
“Intellectual Property (“IP”) and R&D advancements achieved by ebbu’s team apply directly to Canopy Growth’s hemp and THC-rich cannabis genetic breeding program and its cannabis-infused beverage capabilities,” said Canopy Growth. (Source: Ibid.)
One of the things that makes CGC a dependable company when it comes to investing in pot stocks is that it manages to grow and expand internationally and in capacity, while keeping the production costs low. And cannabis companies produce far more products than just pot for smoking, from hemp to CBD oil to medicinal uses. And the more companies CGC teams up with the more opportunities open up.
Canopy Growth Corp probably has the best stock forecast for 2019. With some solid purchases and expansion into Latin America in 2018, CGC has positioned itself as the top player on cannabis market.
CGC’s first-quarter revenue added up to CA$25.9 million, showing a 14% increase from the previous quarter and a 63% increase from the previous year. (Source: “Canopy Growth Corporation Reports First Quarter Fiscal 2019 Financial Results,” Cision, August 14, 2018.) Great increase in the average selling price per gram over the time, hitting CA$8.94, up from CA$8.43 last quarter and CA$7.96 last year also generated huge increase in revenue for the company.
“With our unparalleled success in Canada and Europe, Spectrum Cannabis’ expanding global operational footprint now covering 11 countries, our active regulatory and global market development efforts, as well as approvals to proceed with the first of many planned clinical trials of cannabis-based medical therapies for both humans and animals, our leadership position in international medical cannabis markets continues to strengthen.” said Bruce Linton, Canopy’s chairman and co-CEO in the press release.
And let’s not forget one of the gamechanger events of 2018, when Constellation Brands made a huge investment into CGC stocks.
“Our view is that in the next 10+ years, this is going to be a $200 billion business worldwide. And some would argue [that’s] understating the case,” said Newlands during the interview. (Source: Ibid.)
All in all, Canopy Growth Corp has made all the smart moves in 2018 to keep growing. It has entered into a diverse range of markets and made some of the sharpest acquisitions. With some great opportunities like producing cannabis-infused beverages via its Constellation Brands partnership and its interest in recreational pot across Canada, the chances of CGC seeing downfall is pretty minimal. It would be safe to say that investing in CGC stocks is one of the safest and highly productive decisions right now.