Does BevCanna’s Latest Acquisition Set It Up to be the Next Big Growth Stock in the Cannabis Market?

成长股
Published on: September 25, 2021
Author: NAI500

Already an emerging leader in the booming health and wellness sector, BevCanna continues to add to its impressive portfolio of products with its latest acquisition of Embark Health Inc. This is also a indication that BevCanna is now on track to be the next big growth stock that investors are chasing for.

Upon completion of the agreement announced last week, which will see BevCanna acquire all issued and outstanding common shares of Embark in exchange for the issuance of BevCanna shares, Embark will become a wholly-owned BevCanna subsidiary.

This deal is good news BevCanna and its shareholders.

BevCanna’s Acquisition of Embark Health Provides Access to New Markets and a Suite of Existing Consumer Products

Embark is a renowned manufacturer of high-end solventless cannabis extracts, such as bubble hash, traditional pressed hash, rosin, and dry sift. The company brings with it high-volume manufacturing capabilities and an extensive list of intellectual property assets. In addition to their best-selling Hazel Hash Stick, a line of premium hand-crafted pre-rolls, Embark offers a diversified range of other well-known cannabis products spanning all areas of the cannabis market, including beverages, topicals, and solvents, extracts and hash.

Adding to its health and wellness range the deal also nets BevCanna a majority stake in ProteinQuest, makers of high-quality, protein-enhanced food goods.

“The acquisition of Embark significantly accelerates BevCanna’s evolution into a diversified health and wellness company,” said John Campbell, CFO of BevCanna. “Our unique and diverse portfolio will now include an even broader range of adult-use and wellness channels and innovative product categories. The acquisition will unlock significant value for both organizations and brings together two exceptionally experienced teams, forming one of the most diverse and innovative health and wellness companies in the industry.”

So, how does this news make BevCanna the growth stock to watch right now?

What is a Growth Stock?

As the name suggests, growth stocks are shares in companies whose growth outpaces the overall market, whose revenue and earnings are climbing faster than the average business.

Growth stocks will usually have a higher price-to-earnings ratio while demonstrating a record or above-average growth rate compared to the broader market. Because their focus is on accelerated growth, these companies generally do not pay dividends; instead, they reinvest earnings back into the business.

While growth stocks offer investors the chance to profit from substantial long-term gains, it comes at the cost of increased price volatility and elevated risk. Because growth stocks generally do not pay dividends, investors are purely speculating on the price of these shares going up. If a company fails, investors may incur a loss, but if the company is successful, investors will be rewarded with very generous returns.

Growth stocks come in all shapes and sizes. However, most share two things in common: an innovative product and a market poised for growth. And BevCanna checks both those boxes.

So, while the company can’t be considered a growth stock at this time, its recent acquisitions spree and business development during the summer are positioning them for rapid revenue growth, opening the doors for BevCanna to move into growth stock territory.

Will BevCanna Be the next Cannabis Growth Stock?

BevCanna has been aggressively building its product lineup while pursuing lucrative manufacturing and distribution deals. This year, the company has entered into exclusive agreements with #1 US cannabis beverage brand Keef and award-winning Tinley Beverage Company Inc to bring their products to the Canadian market.

With the addition of Embark, BevCanna now has a full suite of cannabis products covering nearly every corner of the market, including cannabis-infused beverages, edibles, concentrates, liquids, topical creams, and powder drink mixtures.

The company also has secured access to Canada’s three largest retail cannabis beverage markets, with purchase orders from provincial distributors in BC, Alberta, and Ontario.

The Ontario Cannabis Store is the largest provincial distributor of cannabis products in the country. In August, BevCanna received multiple product listings and initial purchase orders from the OCS for two top-selling Keef brand beverages as well as for white label client Green Monké’s international sensations Mango Guava and Orange Passionfruit beverages.

In Alberta, BevCanna has signed products listings and initial purchase orders with the Alberta Gaming and Liquor Commission (AGLC). The order will see Keef, Green Monké, and BevCanna manufactured BC beverage brand State B Cannabis Beverage Co hit over 600 retailers early this fall.

Back on the West Coast, BevCanna has just received multiple product listings and purchase orders from the British Columbia Liquor Distribution Branch (BCLDB) for both Keef and local BC brand State B Cannabis Beverage Co. products. Orders and expected to ship and hit shelves sometime in September.

Disclaimer: The company described in this article is a customer of NAI Interactive Ltd. This material is for informational purposes only and is not intended as a recommendation or offer or solicitation for the purchase or sale of any securities or financial instruments, or for transactions involving any financial instrument or trading strategy.

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