Cannabis stocks have enjoyed a two-day rally so far this week, with high-profile licensed producers Canopy Growth and Aurora Cannabis topping the list. On Tuesday, the two princes of the Canadian cannabis industry saw gains of 15 and 10 percent respectively — serious growth at a time when COVID-19 has most global citizens struggling to pay their rent. But what’s the reason that investors are so gung ho for the green market again?
Cannabis stocks, like many others, are a fickle beast, and so far this week, investors like what they see. According to several reports, Canopy Growth has gone virtual at a time when most of the world is trying to figure out how to open up their doors again. The powerhouse grower launched an online website to sell CBD products, giving them another foot into a billion-dollar industry. Reportedly, the site will sell products from its partnership with lifestyle queen Martha Stewart.
The new site is called shopcanopy.com and, according to reports from inside the company, officials hope to break a Canadian losing streak. Neighbors up north have failed to break into the US hemp industry and have been a bit reluctant as well, thanks to the lack of regulations that have seen crackdowns across the country.
“The website sells CBD soft-gels, oils, topical products and edibles,” noted Investor’s Business Daily. “The website also allows users to browse through different brands that Canopy has developed or acquired over the years.”
However, there is a bit of confusion as to what will be available on the site. As Investor’s Business Daily reported, products from Biosteel, a company in which Canopy has invested were available on the site. However, products from Tweed, their flagship dispensary were nowhere to be found.
Neither were Martha Stewart’s products which the website described as "combin[ing] gourmet flavors — developed by Martha herself — with the purest, safest CBD isolate." It continued to say they were "specifically formulated with guidance from Martha herself."
Even with the new website and the recent market gains, Canopy could not avoid the pitfalls of the current cannabis economy. Last week the company confirmed to Bloomberg that another round of layoffs was coming, this time for an unspecified number of people. This is on top of more cutbacks earlier this year.
Like many other industries, cannabis has been struggling even before the onset of COVID-19. Like Canopy, once giant names Aurora Cannabis, Tilray, and HEXO have all sent employees packing, hoping to cut costs and keep investors happy. However, with the global pandemic in full swing, and hundreds of thousands of people dying, those job losses couldn’t come at a worse time for the working classes that helped to build these companies up from the bottom.
Even being deemed an “essential business” in many states in the US couldn’t delay the inevitable for the cannabis industry.
In other news, cannabis stock experts awaited fourth-quarter results from licensed producer Aphria on Wednesday, and anticipated encouraging results from the company.