The marijuana stocks on our list could quench an investor’s thirst for exposure to the promising cannabis beverage space
SmallCapPower | May 17, 2019: With the growing legalization trend of cannabis, many companies are looking for new niche markets to expand within the cannabis market. This includes Constellation Brands’ $4.5B investment in Canopy Growth Corporation (TSX:WEED), HEXO Corp’s (TSX:HEXO) Joint Venture (JV) with Molson Coors, Sproutly’s (CSE:SPR) JV with Moose Head, and rumours of Coca Cola entering the CBD beverage space. Many cannabis companies are betting big on beverages. It is predicted that cannabis beverages will generate total revenues of about US$4.5B by 2025, with a CAGR of approximately 15.6% between 2019 and 2025 (Zion Market Research, 2019). Many predict there will be sufficient demand for this product due to the rising market demand for wellness beverages by consumers and health food fanatics. Today we have filtered out four marijuana stocks that are gearing up to enter the cannabis beverage market.
*Share prices as at close May 15, 2019, data obtained from S&P Capital IQ
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Sproutly Canada Inc. (CSE:SPR) – $0.82
Cannabis
Sproutly is a Toronto-based cannabis company that focuses on the cannabis beverage and edibles market. The Toronto facility cultivates pharmaceutical-grade cannabis and is working on formulating the first natural, completely water-soluble cannabis solution. On April 30, 2019, the Company announced its Joint Venture with Moosehead Breweries to develop and produce non-alcoholic beverages in Canada. The beverages developed through the partnership are expected to have an effect on consumers five minutes after consumption and last up to 90 minutes. On April 1, 2019, its subsidiary Toronto Herbal Remedies received a processing licence from Health Canada that will become effective on March 29, 2019. The license will allow the subsidiary to produce cannabis oil and related products and permit the Company to conduct research and development activities, such as the formulation of their proprietary beverage products.
- Market Cap: $134.6 Million
- YTD Return: +89.7%
- 30 Day Average Trading Volume: 3,182,000
- 90 Day Average Trading Volume: 1,666,000
Nextleaf Solutions Ltd. (CSE:OILS) – $0.69
Cannabis Extraction
Nextleaf Solutions focuses on extraction technology and has created a portfolio of issued and pending patents to protect their unique, industrial-scale process of procuring purified cannabinoid distillate. Nextleaf and BevCanna have signed a Letter of Intent for research and development and supply purposes. BevCanna is a bottling facility in Osoyoos, B.C., which has 40,000 sq. ft of space and has a capacity of 40 million bottles per year. Nano-emulsified water-soluble THC and CBD are expected to be used in all BevCanna-infused beverages, which should be produced at Nextleaf’s processing facility.
- Market Cap: $62.8 Million
- YTD Return: +62.5%
- 30 Day Average Trading Volume: 2,194,000
- 90 Day Average Trading Volume: 1,826,000
The Tinley Beverage Company Inc. (CSE:TNY) – $0.70
Cannabis & Beverages
Tinley is a beverage company that focuses on hemp-infused beverages and supplements. The Company is based in Los Angeles with 45,000 sq. ft of land and focuses on distributing throughout the West Coast. Tinley has the only patent-produced liquid supplement that contains certifiable phytoconstituent-rich hemp oil. Throughout 2019, the Company plans to replicate the California operations in the priority beverage and cannabis markets in Nevada, New York, and Canada. The Company offers a hemp-extract drinkable supplement, various liquor extracts and alcohol-free alternatives. On March 21, 2019, the Company announced the completion of Phase two of the facility expansion. Tinley announced on May 13, 2019, that they successfully raised $8.9 Million after closing the second tranche of their financing. Net proceeds from the second tranche will be used for general working capital purposes and the completion of its Phase 3 facility in Long Beach, California.
- Market Cap: $71.9 Million
- YTD Return: +35.9%
- 30 Day Average Trading Volume: 721,000
- 90 Day Average Trading Volume: 424,000
New Age Beverages Corp. (NASDAQ:NBEV) – $5.16
Cannabis & Beverages
New Age Beverages, based in Denver, Colorado, focuses on distributing and developing beverages for health-conscious consumers. The Company’s products are sold across 50 states in the U.S. and in more than 60 countries. On April 24, 2019, the Company announced the expansion of its Marley brand licensing agreements with Bob Marley’s family for another 10 years. The Company is expanding the Marley collection to Marley+CBD, which will contain 25 mg of pharmaceutical-grade CBD per serving. On April 8, 2019, New Age Beverages announced its distribution expansion with Walmart for their Marley brand.
- Market Cap: $523.8 Million
- YTD Return: -2.3%
- 30 Day Average Trading Volume: 4,291,000
- 90 Day Average Trading Volume: 6,060,000
Nextleaf Solutions (CSE:OILS) is a featured sponsored company and has paid SmallCapPower.com a fee for coverage.
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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