The Inevitable Resurgence of CBD Stocks (NEPT, GRPS, YCBD)

The CBD theme is tied closely to the cannabis theme. But there is a distinction. First off, CBD is already legal in all 50 states. The upside potential for the CBD industry is also thought to be considerably higher than that of the THC-bearing cannabis-based products industry because it has a greater potential to translate into the mainstream consumer products sector.

CBD products are not about “getting high”. They’re about “getting well”. There is an increasing body of research that suggests CBD products may function as a key health and wellness supplement. And this idea has already caught on with a growing number of consumers interested in preventative health and wellness.

According to Grand View Research, the global cannabidiol market size is expected to reach $13.4 billion by 2028. The market is expected to expand at a CAGR of 21.2% from 2021 to 2028. The study notes that “Increasing awareness about the health benefits of cannabidiol (CBD), changing consumer opinion, and attitude toward CBD products are some of the key factors driving the demand for these products. Furthermore, increasing demand for cannabidiol from various end-user industries such as food and beverage, personal care and cosmetics, and pharmaceuticals is expected to trigger market growth.”

With that in mind, we take a look at a few of the more active and interesting stocks with direct exposure to theme, including: Neptune Wellness Solutions Inc (NASDAQ:NEPT), Gold River Productions Inc (OTCMKTS:GRPS), and cbdMD Inc (NYSEAMERICAN:YCBD).

Neptune Wellness Solutions Inc (NASDAQ:NEPT) operates through two segments, Nutraceutical and Cannabis. The Nutraceutical segment offers turnkey solutions, such as raw material sourcing, formulation, quality control, and quality assurance for omega-3 and hemp-derived ingredients under different delivery forms, including softgels, capsules, and liquids. The Cannabis segment provides extraction and purification services from cannabis and hemp biomass.

The company also offers formulation and manufacturing solutions for value added product forms, such as tinctures, sprays, topicals, vapor products, edibles, and beverages.

Neptune Wellness Solutions Inc (NASDAQ:NEPT) just announced the filing of a preliminary short form base shelf prospectus, which provides the flexibility to make offerings of securities during the effective period of the Prospectus, until April 2023. The final short form base shelf prospectus is expected to be filed in April 2021 and will replace the existing shelf prospectus, which was filed in January 2019.

According to the release, the Prospectus has been filed in each of the provinces and territories of Canada, and a corresponding shelf registration statement on Form F-10 was also filed with the United States Securities and Exchange Commission. These filings, when made final and effective, will enable offerings of securities up to an aggregate initial offering price of US$250 million at any time during the 25-month period that the Prospectus remains effective.

While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action NEPT shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -6% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities. Over the past month, shares of the stock have suffered from clear selling pressure, dropping by roughly -6%.

Neptune Wellness Solutions Inc (NASDAQ:NEPT) generated sales of $3.3M, according to information released in the company’s most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of -88.4% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($32.2M against $19.1M).

Gold River Productions Inc (OTCMKTS:GRPS) trumpets itself as a company focused on market-targeted products including, but not limited to rare cannabinoids and effective products where a particular need is identified.

Products for pain relief, sleep, etc. that will be distributed through convenience stores, independent pharmacies and more will have mass appeal to the market.

Gold River Productions Inc (OTCMKTS:GRPS) most recently announced the appointment of the Dr. Bruce Bond in this integral role of the company.

According to the company’s release, Dr. Bond practiced for twenty-two years and the Company will be utilizing his vast experience in clinical practice along with his experience in the nutraceutical industry, which includes eighteen years as a nutritional and marketing consultant for Standard Process, where he contributed as a national speaker for that period as well. With almost 500 national lectures, he spoke on the topics of endocrinology, cardiology, hepatic dysfunction, immune disorders and more with regards to nutraceutical, whole foods and herbal therapy. In his capacity, he introduced and trained physicians in the science of nutraceuticals and herbs as alternatives to traditional pharmacologic medicine. Dr. Bond provided developmental input on many new products that afforded Standard Process immense national and international success. His landmark book, published in 2013, “Practicing with Integrity and Excellence, How to Take Your Practice from Good to Great,” sets a new standard for the incorporation of nutraceuticals into traditional medical, chiropractic, osteopathic, acupuncture, and naturopathic practices.

GRPS has pulled back over the past week of trading action, with shares sinking something like -12% in that time. That said, the stock has been on a rip-roaring upward trend, up over 600% since December.

Gold River Productions Inc (OTCMKTS:GRPS) generated sales of $937K, according to information released in the company’s most recent quarterly financial report. That adds up to a huge sequential quarter-over-quarter growth rate of 41.9% on the top line.

cbdMD Inc (NYSEAMERICAN:YCBD) promulgates itself as a company that produces and distributes various cannibidiol (CBD) products. It owns and operates the consumer hemp-based CBD brand, cbdMD. The company’s product categories include CBD tinctures, capsules, gummies, bath bombs, topical creams, and animal treats and oils. It also offers pet related CBD products under the Paw CBD brand name.

The company distributes its products through an e-commerce Website, wholesalers, and various brick and mortar retailers in the United States.

cbdMD Inc (NYSEAMERICAN:YCBD) just announced that it has formed cbdMD Therapeutics LLC, a newly formed wholly-owned subsidiary of the Company for the purposes of isolating and quantifying the Company’s ongoing investments in science related to its existing and future products, including research and development activities for therapeutic applications.

“As one of the leading consumer CBD brands in the world, I believe cbdMD is in a unique position to explore the therapeutic potential of CBD and the other lesser-known cannabinoids, support scientific advancements through clinical trials, and perform toxicity studies to demonstrate the safety of cannabinoids as novel therapies. The Company has formed cbdMD Therapeutics with the mission to provide its customers with therapeutic options to replace opioids and other prescription pain killers and bring to market novel therapies for conditions where people suffer from pain, inflammation, sleeplessness or anxiety such as osteoarthritis, fibromyalgia, insomnia, and anxiety disorders. These novel therapies will be first identified through the core of cbdMD’s current dietary supplement science and research to further expand its brand’s use and acceptance by consumers worldwide. The launch of the cbdMD Therapeutics signals to the marketplace that cbdMD is committed to providing the necessary resources to ensure the success of this mission,” said Dr. Swift.

The stock has suffered a bit of late, with shares of YCBD taking a hit in recent action, down about -7% over the past week. cbdMD Inc (NYSEAMERICAN:YCBD) generated sales of $12.3M, according to information released in the company’s most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of 5.4% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($29M against $6.7M).

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