CBD and Hemp represent two very large submarkets within marijuana stocks. Although these might seem very similar, thee two substances are quite different. For starters, CBD or cannabidiol is a component derived from either hemp or the cannabis plant. Because of this, many leading investors have hedged their bets on pot stocks that are working with hemp and or CBD. CBD has a long list of uses including everything from health and wellness all the way to the pharmaceutical industry.
Although the cannabis industry is quite volatile, companies working mostly in the hemp or CBD market are less subject to these high rates of volatility. In the U.S., hemp has been legal for over 2 years now. When the Farm Bill passed back in 2018, it effectively allowed individuals to grow and produce hemp within the country. This led to a boom in the market and the rise of some leading pot stocks.
Additionally, many big-name cannabis companies decided to get into growing hemp given it would now be legal in the U.S. Because CBD can be produced from hemp, the two often go hand in hand. This means that many companies involved in hemp production, also use their product to produce CBD. In addition to this, since there are so many grow operations in the nation for cannabis, it is extremely easy to begin growing hemp there as well. This is due to the massive infrastructure that already exists within the nation.
A Pot Stock for the Hemp Market
Scotts Miracle-Grow (SMG Stock Report) is not really a pot stock by any traditional sense of the term. But, it does have a very active roll in the industry. The company produces a wide range of gardening supplies and tools to help anyone grow better plants. After realizing its potential to help cannabis growers, it quickly opened up shop with its subsidiary, Hawthorne Gardening. This subsidiary was created with the intention of helping those who wish to use the hydroponic growth method of producing cannabis.
But since that time, the company has seen a large influence from the growth of the hemp market. The company has also acquired several other leading brands in the industry much as Sunlight Supply and General Hydroponics, to help itself become the leader in this area of the cannabis/hemp industry. Because of this, the company has managed to stay at the top of its game into the present day.
Pot Stock To Watch: A Non-Obvious Play for CBD
Tilray (TLRY Stock Report) could come as a surprise as it is usually on a ‘do not buy’ list. And this sentiment is also shared here, but the company is still an intriguing player in the CBD market. Shares of Tilray are down almost 90% for the past twelve months which is not a great sign. But, the company has been working to come back to its top position in the market. During today’s trading on March 10th, the company saw around 3% in gains. This is not very substantial, but it is enough to show that there may be a very small amount of bullish sentiment hiding out.
The company has been working to ship CBD to the U.K. market which is a very interesting move. As one of the only major cannabis stocks working out of the European market, Tilray looks like it is in an interesting position if it is able to get its pricing back on track. The demand for CBD in Europe is extremely high with domestic production very low. This means that the company could become one of the leading exporters in this area of the market. For now however, Tilray remains a questionable pot stock to watch with a potentially bright future.
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