Do you want to make money from the CBD trend by investing in the stock market? If YES, here are 20 best profitable CBD oil companies to invest in.
A CBD oil business sells and/or manufactures CBD oil for various purposes. This may happen either online or in stores, though most people won’t open up a specific retail location selling just CBD. Most businesses will sell the oil for general purposes, while some will concentrate purely on cosmetic uses.
CBD is in the middle of a business boom. Sometimes known as “the other weed,” cannabis-derived cannabidiol is sharply catching on in products marketed and sold throughout the united states, ranging from infused tinctures and oils to premium chocolate bars.
Is It Profitable to Buy Stocks in CBD Oil Companies?
Statistics has it that the CBD industry is already worth $1 billion and Wall Street experts think it could reach $16 billion by 2025. Aside from its medical uses, its growth in the stock market may reach an increase of 700% by 2021 with a compound annual growth rate (CAGR) of 11%.
Also, coupled with the number of recreational marijuana users switching to CBD, it may even be possible to reach these figures sooner. Additionally, many big companies have reported great success in their investments with medical cannabis. This is a good sign that investing in a CBD Oil Company may be worth it.
Most investors avoid investing in marijuana stocks as they consider it unethical. If an investor wants to avoid investing in ‘sin stocks’, but still wants to hold a few shares of some of the best CBD companies, then investing in CBD oil might be a good option. There are many investors who don’t like investing in the marijuana industry as they do not support the idea of using recreational marijuana.
However, people have to understand that cannabidiol or CBD oil is different from the marijuana plant itself. CBD and THC are the medical and recreational parts of marijuana, respectively. If investing in illegal substances is against an investor’s principles, they won’t have to worry since CBD is legal and professionals examine it for medical purposes. Indeed, there are many lucrative opportunities for an investor to get into the CBD industry.
You can decide to start small and invest in a retail store for CBD hemp oil. You can also decide to invest in an oil distributor. Before you invest into any company, there are research and considerations you have to make. These leading cannabis companies mentioned below might be worth considering for investment.
20 Best Profitable CBD Oil Companies to Invest in
- Aphria (APHA)
This company has grown over the years to become the world’s third-largest cannabis producer. With prices of dried cannabis in decline, CBD has become one distinct outlet for adding value. It already provides an extensive line of products.
In the U.S., it has worked to build partnerships to bring CBD products to the market as it awaits legal status for its marijuana-based CBD. Coupled with the high capacity, APHA stock also offers low valuation. It maintains a forward price-to-earnings (PE) ratio of around 23.7. It also trades at just over 9.5 times sales, which comes in well-below many larger peers.
Meanwhile, Wall Street expects it will turn profitable this year. APHA stock has also avoided the harsh decline to hit larger Canadian names in the cannabis industry. Even with giving up most gains from earlier in the year, the price of APHA has remained steady since about May. Moreover, it has logged a 20% gain since the beginning of the year.
- Terra Tech Corp
Popularly known as a retail cannabis company that’s “hoping” to dominate the California cannabis market. According to reports, as of April 2018, the company’s market cap was around $11 million, which makes them one of the biggest companies to watch.
For the third quarter of 2018, stockholders of the company had equity amounting to approximately $93.1 million. This means there was an increase of approximately $16.3 million compared to the equity of the last quarter of 2017, which was only $76.8 million.
- CV Sciences Inc.
Just like Aphria, CV Sciences Inc. too enjoyed a distribution deal in August with The Vitamin Shoppe. The company plan to leverage the specialist retail platform provided by its partner to distribute its Plus CBD Oil product. Other products that will be included in the nationwide network of Vitamin Shoppe will include Gold Formula Drops, Gold Formula Soft gels, Plus CBD Oil Roll-On and capsules and sprays of the Total Plant Complex range.
All products will be available in 30 states in the US and Puerto Rico after mid-September. This will create a great opportunity for the company to create a broader spectrum of sales for its products across the US.
- Kush Bottles
Just like Terra Tech Corp, Kush Bottles is also a California-based company. This company was first established as a packaging business and soon ventured into the cannabis industry. A comparison of the stockholders’ equity from August 31, 2017 ($40.9 million) to May 31, 2018 ($72.3 million) showed a huge increase of more than $30 million.
However, Kush Bottles fastest-growing business is marketing solvents and hydrocarbons used in extracting oils and cannabinoids. This business should especially benefit from the expansion of the U.S. hemp CBD industry with rising demand for CBD extraction from hemp plants.
- Cronos Group Inc.
Known as the first weed stock to trade on an exchange in the United States. And speaking of marijuana companies investing in CBD, this Canadian pot firm just bought a popular CBD lotion and skincare company. On Aug. 2, Cronos bought Lord Jones for $300 million, and the stock popped 5%. It’s making further moves very soon, with the purchase of several other subsidiaries of Redwood Holdings.
Cronos increased profits by 55% in 2018, and acquisitions like Lord Jones mean that’s only pointed higher. In Q1 2019, Cronos took home 120% more revenue than in the same time period last year. And experts even gave it a high target price of $19.58 from its current $11.77. That 66% growth is not something you want to pass up.
- 1933 Industries Inc.
Previously known as Friday Night Inc., 1933 Industries Inc. carries an array of cannabis wellness products many users purchase for medical purposes. According to research, within a three-month period ending on July 31, 2018, the company experienced a revenue increase of 18%, from $3.3 million to $3.9 million CAD. They also enjoyed an increase in shareholders’ equity for 2018. For July, they had $36.9 million CAD, which rose up to $41.4 CAD in October.
- Charlotte’s Web Holdings
Although not a household name, things are about to change swiftly for the Boulder, Colorado-based producer and distributor of hemp-based CBD products. With companies such as Kroger and CVS stocking their products, the public should increasingly recognize Charlotte’s Web as more than just a children’s book.
Reports have it that the company’s stock suffered in August as it reported an earning and revenue miss. Still, amid the ups and downs, the stock has risen by nearly 65% since the beginning of the year. Investors may also pick it up at a discount as it fell by over 23% just before the company’s missed estimates. Even with the miss, revenue grew by 45.3% year-over-year.
Although profits fell from the four cents per share in the same quarter last year, operating expenses nearly doubled to fund expansion. Moreover, the forward PE ratio stands at just 24; a bargain considering the price-to-sales (PS) ratio of many unprofitable cannabis stocks exceeds that figure. Furthermore, Wall Street forecasts profit growth of 58.3% this year and 263.2% the following year.
- GW Pharmaceuticals
This company remains one of the pioneers in the CBD and marijuana industry. They are a well-known British pharmaceutical company that offers Nabiximols, the first cannabis plant-derived medicine for multiple sclerosis to gain market approval in any country.
It was founded in 1998 as a public limited company. Today, it has a public offering on American Depository Shares and Nasdaq Global Market. Statistics showed that the company has shareholders’ equity of $674.08 million as of the last quarter of 2018, which ended December 31. This revealed a large increase from the previous quarter of the same year ending September 30, which earned only $415.16 million.
- Elixinol Global Limited
This Australian company is working on steroids in 2019. In the first half of the year, it reported a whopping 19% revenue growth and then went on a spending spree to create more products, hire new staff and do market research. Note that the company’s share price has been relatively weak; it could be because of its huge marketing and brand awareness expenditure, which is expected to fuel growth in the long run.
- Aurora Cannabis Inc.
Aurora is a licensed Canadian cannabis provider. It has a public offering on the Toronto Stock Exchange as ACB. As of 2018, it has five sales licenses and eight production facilities in 18 countries across the globe. In 2017, it hit around $13.5 million in revenue in sales.
Its shareholders’ equity for the last quarter of 2018 was $4.292 billion CAD, a decrease from the previous quarter of the same year, which was at $4.4 billion CAD. With its impressive performance, it’s no wonder plenty of experts are advising investors to watch out for Aurora Cannabis Inc. this year.
- Curaleaf Holdings (CURLF)
Curaleaf Holdings is another stock on the verge of becoming well known in the United States. Based in Wakefield, Massachusetts, Curaleaf produces cannabis and hemp-based CBD products for wellness. Although much of its business faces Schedule I-based restrictions, it has managed to establish operations in 12 states.
Still, with hemp-based CBD, they have the segue needed to go nationwide no matter what happens with marijuana laws. Also, the market seems intent on pushing CURLF stock higher. Despite a recent earnings and revenue miss, Curaleaf stock rose on a 231.2% increase in revenue year-over-year. Furthermore, despite volatility in the equity, CURLF stock has risen by almost 60% year-to-date.
It has also begun to recover from a downturn in the stock that saw its value fall by about 43% between early May and mid-July. Admittedly, multiples offer a mixed picture. A PS ratio of 25.3 makes this one of the more expensive CBD stocks to buy. Also, it will need loosened Schedule I restrictions to achieve its potential. However, with it trading below its book value, investors should consider CURLF stock before it becomes more recognized.
- Isodoil Inc.
This company is known worldwide as a top provider of industrial hemp and CBD products. Isodiol Inc. continues to raise awareness about the medical benefits of cannabis-derived goods. Their goal as a company isn’t solely to sell their products but also to educate the masses on using medical marijuana.
Last month, the company published its financial report for the quarter ending June 30, highlighting a $4.2 million revenue. Though the company still suffers a loss, it has reduced operating expenses by $13 million quarter-on-quarter. It too has a supplement line for pets called Pawceuticals. Moreover, it has Iso-Sports product Vending Machine program in 20 Powerhouse Gym locations in the US.
- Freedom Leaf Inc.
Freedom Leaf’s subsidiary Green Lotus completed the first commercial shipment of CBD topicals worth $600,000 to Mexico in August. The transaction took place in association with CBD Life SA, a Mexican brand for consumer goods. The goods will be distributed via regular retail channels and will not need any separate medical or government approvals. This shows a significant market for cross-border CBD topicals that an investor can cash in on.
- Canopy Growth
Canopy Growth was the pioneer Canadian marijuana producer to enter the U.S. hemp CBD market. The company is building a large-scale hemp production facility in New York State. Canopy founder and co-CEO Bruce Linton stated in February that the company should have hemp CBD products on the market in several states by the end of the year.
Canopy has also filed for U.S. trademarks for potential brand names including CBD Simplified, CB-Tea, Hemp Break, and Hemp Burst. The company should have access to expertise in building successful commercial brands in the U.S.
Constellation Brands owns a 38% stake in Canopy Growth and is partnering with the company to develop and market cannabis-related products. Constellation’s Corona and Modelo brands rank at the top of the U.S. premium beer market.
Also note that Canopy Growth has plenty of other opportunities outside of the U.S. hemp CBD market. It claims the highest market share in Canada’s adult-use recreational marijuana market and should enjoy a boost later this year when the country opens up the doors for the sale of cannabis-derivative products like beverages and edibles. Canopy is also a leader in international medical cannabis markets.
- HEXO Corporation
HEXO (NYSE:HEXO) offers a unique opportunity in many areas of the cannabis industry, including CBD-based products. Boasting of 30% market share in its home province of Quebec, it maintains a base from which it can move into markets in both Canada and the U.S.
Moreover, with its alliance with Molson Coors, it presents a unique opportunity in the CBD and cannabis-based beverage market. HEXO stock trades at just over $4.20 per share as of the time of this writing. It has lost about half of its value since peaking at $8.40 per share in late April. This makes HEXO somewhat risky as it has followed larger Canadian peers on a downward trend. However, the decline has taken its forward price-to-earnings ratio to about 47.
While that may seem high amid flat growth for 2019, analysts are looking for 170.6% earnings growth for fiscal 2021. Although HEXO stock remains one of the riskier stocks to buy, its position in Quebec and its alliance with Molson Coors should give the company market niches with which it can lead in CBD and perhaps cannabis in general.
- Folium Biosciences (USA)
Folium Biosciences boasts of a lot of interesting growth happening this year. It is the largest producer of cannabinoids (hemp-derived) in North America and earns its spot because of SuperZoo, its animal-focused CBD line.
It has a broad lineup of hemp pellets for livestock, dog treats, and tinctures that could help dogs and other pets with different health conditions. It is planning a facility in Canada too, and a South American operation is also in the pipeline which could help it dominate the Americas in CBD pet and livestock products.
- Golden Leaf Holdings Ltd.
This Portland-based company is currently one of the largest providers of CBD oil in North America. They pride themselves in being a result-driven brand that focuses on addressing the needs of their customers. For Q3 2018, the company reported revenues of $5.1 million, a 63% increase from Q3 2017’s $3.1 million.
- Medical Marijuana Inc. (USA)
Medical Marijuana Inc. holds a unique record of becoming the first public-listed cannabis company in the US. The company has several accolades up its sleeves. For example, it is the first company in the CBD sector to become a part of Prescribers’ Digital Reference. It is an educational resource widely used by doctors in the US. Two of its products, Pure Gold CBD hemp oil (by subsidiary company Kannaway) and Real Scientific Hemp Oil Gold Label were included in the list.
- Cara Therapeutics Inc.
Cara Therapeutics is a clinical-stage biotechnology company focused on developing and commercializing new chemical entities for the indications of pain and pruritus (itching). Although all of the firm’s clinical-stage products target opioid receptors, Cara is currently conducting preclinical research on cannabinoids for the treatment of neuropathic pain.
- Planet 13 Holdings (PLNHF)
Planet 13 Holdings has made a name for itself in its home market of Las Vegas through retailing. Its Cannabis Entertainment Complex, otherwise known as the “Superstore,” attracted a record number of visitors in Holding. But apart from gaining fame as a retailer, it also produces CBD. In May, Planet 13 announced the introduction of its Planet M CBD brand.
They made this available at the Superstore, the Fashion Show Mall, with plans to expand to other retail outlets. They also made Planet M available online. This strategy appears effective. Experts believe that this is one of the stocks to buy in large part because it will probably turn a profit this year. Earnings should grow quickly from there.
Experts predict an increase of 118.2% this year and a staggering 450% in fiscal 2021. Despite the massive growth, it trades at only 17.5 times forward earnings and just over 16.1 time’s sales. PLNHF stock had stagnated since May, trading in a range between $1.80 and $2.20 per share.
However, it has not suffered the decline seen in most other cannabis stocks. It has also risen by around 107% since the beginning of the year. As the Superstore increasingly becomes a destination for cannabis shoppers, it should not only bolster sales of CBD products, but it should also boost the growth of PLNHF stock.
If you are considering investing in CBD oil companies, also consider companies in Canada. The US northern neighbor is home to some of the most successful and promising companies working in the CBD oil sector. But ensure to perform your due diligence before investing in any company.