The CBD industry is, arguably, the most exciting arm of the cannabis industry. As CBD is derived from hemp, hemp stocks are gaining attention.
Investors looking to play the US hemp stock market should also look at Canada's cannabis companies that have entered the space.
Hemp Stocks Coming Down From the North
First of all, there are multiple reasons why CBD is an exciting arm of the cannabis industry. One reason is that CBD-infused products command much higher margins than traditional dried flower.
Another is the myriad of uses CBD has and therefore the myriad of revenue streams potentially afforded to this product. The cannabinoid is used in everything from body creams to pet medicines, to intense-level FDA-approved treatments for epilepsy, and everything else in between.
As the nonpsychoactive cannabinoid found in cannabis, CBD is best known for its medical, relaxation, and anti-inflammatory benefits. It is extracted from both marijuana and hemp plants, but hemp enjoys total legality at the federal level in the US, allowing for a legal industry now projected to be worth $22 billion by 2022.
It also helps that hemp is far easier to grow than marijuana.
As analyst Sean Williams states:
"With CBD possibly comprising half or more of the total cannabinoid market in the U.S. in the years to come, it's become a hot target for cannabis stocks."
Canada's Hemp Stock Plays
As stated, some major Canadian cannabis companies have entered the US hemp market. Here are ones to look out for:
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Village Farms International (TSX:VFF) (NASDAQ:VFF)
Though not the biggest cannabis company, Village Farms has major hemp ambitions. It already has two hemp joint ventures under its belt, leading to 920 acres of hemp planted in 2019. Village Farms also has up to 5.7 million square feet of existing vegetable-grow space in Texas that may be retrofitted to grow hemp instead.
Shares sell for $11.60 USD on the NASDAQ at present.
The Green Organic Dutchman (TSX:TGOD) (OTCQX:TGODF)
The Green Organic Dutchman, or TGOD, announced only one month ago that it partnered with a private company called Califormulations for the purpose of developing and producing TGOD-branded hemp-based beverages for sale across the US—which is a big step for The Green Organic Dutchman.
This hemp stock sells for 3.23 CAD on the TSX at present.
CannTrust Holdings (TSX:TRST) (NYSE:CTST)
Finally, CannTrust Holdings announced only this week that through a joint venture with California's Elk Grove Farming Company, it will enter the US hemp market. The 50-50 venture gives access to 3,000 acres of farmland, and an initial hemp crop of 300 acres in 2020 is expected.
CTST stock is swapping hands for $5.04 USD at present on the NYSE.
What hemp stock is on your radar? Let us know!
Featured Image: Canva
