Will more capital flow into the marijuana industry in 2021 following the improving chances of federal legalization in the U.S.? Funding was tight in the COVID-19 year. Cannabis companies raised approximately US$2.6 billion only in the first half of 2020. According to Viridian Capital Advisors, it was a 66% year-over-year drop.
The United Nations Commission on Narcotic Drugs’ decision to remove cannabis from the strictest schedule under the Single Convention on Narcotics in December brightens the outlook even more. Now, the only thing lacking is a federal cannabis reform in the U.S.
Naturally, cannabis investors are starting to pick their horses in the race to garner significant market share in the American pie. Canopy Growth and Aphria seem to be the favourites lately. However, one underrated weed stock has the inside track and could explode more than the industry giants. The share price might even double in 2021.
Global leader in CBD wellness products
Charlotte’s Web (TSX:CWEB) from Boulder, Colorado, happens to be the world’s leading producer and distributor of hemp-based cannabidiol (CBD) wellness products. The $824.76 million vertically-integrated company doesn’t produce or sell medicinal or recreational marijuana.
The exclusive focus on CBD products gives CWEB a maximum advantage because medicinal CBD is broadly legal in the U.S. The company recently launched the new Charlotte’s Web THC-Free 25mg CBD Oil Tinctures (10 or 30-millilitre sizes).
This latest wellness product could be the next growth catalyst. The target clients are the so-called daily heroes such as healthcare workers, civil service employees, firefighters, police officers, and many more. Most of them are stressed-out or exhausted from the daily grind. They are allowed to manage stress using only THC-free products.
This particular group now has the option to buy THC-free hemp CBD extracts. Charlotte’s Web aims to address the rising stress and anxiety levels of healthcare workers. Interested customers can purchase from the company’s website, but it will be available in retail stores by April 2021.
Deanie Elsner, Charlotte’s Web President and CEO, said, “Our new THC-Free CBD oil tinctures expand access to hemp wellness solutions for everyone. We especially want to provide products to help support the healers on the frontlines.”
In December 2020, Charlotte’s Web signed an exclusive distribution agreement with InterCure Ltd., owner of Canndoc, one of Israel’s largest and most established medical cannabis producers. The partnership is indeed strategic as Canndoc is a pioneer in pharmaceutical-grade cannabis.
You can buy its GMP-approved medical cannabis products in pharmacies in Israel. Canndoc also holds international cultivation and distribution agreements in the European Union. Soon, Canndoc or another InterCure subsidiary will sell. Selected Charlotte’s Web hemp extract wellness products in Israel.
Charlotte’s Web and InterCure also are considering future distribution agreements in certain European countries. The two companies will also explore opportunities such as clinical trials, product development and manufacturing in Israel. By partnering with regional leaders, Charlotte’s Web’s can leverage its established expertise within international markets. InterCure is now one of CWEB’s leading strategic allies outside of North America.
The positive industry trends and CWEB’s leading market position should propel the stock in 2021. You can initiate a position today while the price is only $5.92. A breakout is coming soon.
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Fool contributor Christopher Liew has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Charlottes Web Holdings.
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