The CBD market was the hottest growth idea in the financial world several years ago. That strength was driven by a simple idea: this long-time tiny niche market was showing signs of going mainstream in a process that could drive 100-200% annualized growth in end-market sales of products containing CBD for years, resulting in a multi-billion-dollar market.
But that story turned into hype and, like so many booms, there was an inevitable bust that followed.
In the case of the CBD boom-bust cycle, we saw the price of CBD oil go sky high and then the gold rush started among new fledgling producers. That ran its course until everyone had a next-door neighbor making the stuff in a basement “lab” and opening up an ecommerce portal.
Once that new tsunami of supply started to hit the market, the price of CBD oil crashed – what was once selling for $5,500/kg was now selling for $1,000/kg. And suddenly the math on those convertible financing rounds didn’t add up so well, and all those “hot CBD stocks” came crashing back down to earth.
It’s a story that’s as old as the market itself. But there’s another chapter to that story: The next wave. The key point here is that the original analysis that started the whole frenzy in the first place is still perfectly valid. The CBD products industry is headed toward mainstream status and is still one of the fastest growing markets around.
Indeed, according to a recent report from ResearchAndMarkets.com, the global CBD market is expected to expand to $13.4 billion by 2028, reflecting a CAGR of over 21% from 2021 to 2028.
Now that all the pretenders and riffraff have been smoked out of the market, the key remaining players have that upside all to themselves, which could represent an important secular growth opportunity. With that in mind, we take a look at some of the key players, including Real Brands Inc (OTCMKTS:RLBD), cbdMD Inc (NYSEAMERICAN:YCBD), Medical Marijuana Inc (OTCMKTS:MJNA), and Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF).
Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF) bills itself as a company that develops and distributes hemp-based cannabidiol (CBD) wellness products. Its products include CBD hemp oils, capsules, topicals, and pet products that feature CBD hemp oil extracts.
Charlotte’s Web Holdings, Inc. sells its products online as well as through distributors, and brick and mortar retailers. Charlotte’s Web current product categories include tinctures (liquid products), capsules, topical, as well as pet products. Charlotte’s Web hemp-based whole plant extracts are sold through select distributors, brick and mortar retailers, and online through the Company’s website.
Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF) recently unveiled a new multi-year exclusive agreement under the terms of which Charlotte’s Web™ and CBDMEDIC™ branded hemp CBD products will be available for purchase in more than 140 Lifecares destinations located with Life Time’s athletic resorts and on its online health store at shop.lifetime.life. Additionally, as the exclusive CBD product partner of Life Time, Charlotte’s Web products will also be featured on in-club signage, as well as in the award-winning Experience Life magazine and online digital content.
“This is a strategic relationship born of our shared values around wellness, quality and sustainability,” said Deanie Elsner, Charlotte’s Web CEO and President. “This partnership aligns well with our expansion strategy to reach consumers in new environments across the U.S. We are excited to work with Life Time.”
The stock has suffered a bit of late, with shares of CWBHF taking a hit in recent action, down about -5% over the past week.
Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF) generated sales of $29.6M, 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 -15.5% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($44.1M against $32M).
Medical Marijuana Inc (OTCMKTS:MJNA) has products that range from patented and proprietary based cannabinoid products to seed and stalk or isolated high value extracts manufactured and formulated for the pharmaceutical, nutraceutical, and cosmeceutical industries.
The company licenses its proprietary testing, genetics, labeling and packaging, tracking, production, and standardization methods for the medicinal cannabinoid industry.
Medical Marijuana Inc (OTCMKTS:MJNA) recently announced today that the Company’s subsidiary HempMeds® is excited to welcome five-time Brazilian national wrestling champion and professional UFC fighter Raoni Barcelos as its newest spokesperson for the company. Barcelos, who hails from Rio De Janeiro, is a former amateur wrestler and grappler, and current professional mixed martial artist (MMA). Barcelos has been an active fighter for nine years in the bantamweight division.
“We are excited to begin this new project and begin partnering worldwide with professional athletes who may be able to improve their wellness by taking our products,” said HempMeds® CEO Raul Elizalde. “We feel that his testimony will help the public learn about their potential benefits.”
Even in light of this news, MJNA has had a rough past week of trading action, with shares sinking something like -4% in that time. That said, chart support is nearby and we may be in the process of constructing a nice setup for some movement back the other way.
Medical Marijuana Inc (OTCMKTS:MJNA) managed to rope in revenues totaling $8.9M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of -33.2%, as compared to year-ago data in comparable terms. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($5.6M against $7.2M, respectively).
Real Brands Inc (OTCMKTS:RLBD) already has a number of big catalysts in play, but also recently filed its long-awaited Form 10 (voluntarily), which tips its hand and indicates a likely uplist on the way.
In addition, according to a recent interview (which can be found here), the company is in late-stage negotiations with a major celebrity influencer who will help to spread its brands far and wide and generate massive consumer interest.
Real Brands Inc (OTCMKTS:RLBD) is also working on expanding its product lines and has the proprietary technology to produce higher margin cannabinoid-based products at scale efficiently, which grants RLBD another edge over the competition. RLBD is also working on an international expansion that will include marketing through international sports celebrities and sports leagues and include a sports wellness product line that is reportedly nearing launch. RLBD is also working on a line of CBD Beverages and other fresh concepts and has noted that it is seeking an OTC uplist.
But the company’s Form 10 filing is key. As noted above, it is likely part of a process of uplisting, but it should also help to finance a major expansion in products and exposure in the global CBD marketplace.
RLBD is almost a quarter owned by Turning Point Brands, Inc. (NYSE:TPB), which is a third owned by a multi-billion dollar hedge fund with a vested interest in helping TPB, and its major interests and partners, secure necessary financing on strong investor-friendly terms. TPB trades on a major exchange already.
TPB also has big exposure on the distribution side to the convenience store marketplace, which is something the other major CBD players likely lack, giving RLBD an edge down the line as the marketplace expands into that huge end-market point of sale due to RLBD’s relationship with TPB as a major supplier and investment holding.
Real Brands Inc (OTCMKTS:RLBD) shares are pulling back to potentially test to key support at the stock’s rising 200-day MA. The last time this technical level was tested, it resulted in a 200%+ 10-day rip. The stock is up nearly 1,000% over the past year since new management got involved in a hands-on manner. Even still, it has pulled back almost 60% from its highs earlier this year.
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) most recently announced that its recently formed subsidiary, cbdMD Therapeutics, has begun a collaboration with researchers at the Colorado State University (CSU) veterinary program, to explore the effects of the Company’s patent pending, proprietary cbdMD branded cannabinoid blend on dogs that suffer from osteoarthritis.
“It has been estimated that one in five dogs are diagnosed with osteoarthritis in their lifetime. With almost 1 billion dogs globally and over 75 million in the US, osteoarthritis effects millions of our loved ones. Paw CBD is committed to providing products that can improve our pet’s quality of life and provide relief for joint discomfort for the millions of pets who suffer from this disease. Our partnership with CSU will serve as the foundation for future work where we will explore the clinical impact of our proprietary broad spectrum cannabinoid blend on pain and mobility in our pets,” said Martin Sumichrast, Chairman and Co-CEO of cbdMD, Inc.
It will be interesting to see if the stock can break out of its recent sideways action. Over the past week, the stock is net flat, and looking for something new to spark things. Over the past month, shares of the stock have suffered from clear selling pressure, dropping by roughly -8%.
cbdMD Inc (NYSEAMERICAN:YCBD) pulled in sales of $11.8M in its last reported quarterly financials, representing top line growth of 25.5%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($24.7M against $6.9M).