The days when marijuana “edibles” were limited to a bunch of teens passing around a pan of homemade pot-laced brownies are long over.
The legal marijuana industry now grosses more than $5.4 billion a year through the sale of cannabis-infused food and drinks – for people who want to avoid the harmful effects of smoking, but still want the drug’s potent effects. And as marijuana continues its march to legalization, that number will keep climbing.
That means “edibles” re one of the most lucrative legal marijuana opportunities on the market. As I told you just yesterday, according to the “inside info” I picked up from New Frontier Data, use of edibles and concentrates (that is, vaping) each nearly tripled in the last year, eating into the smokable form’s market dominance. They now compose 33% of the total market – and that number is climbing.
Now I want to show you one of my favorite speculative plays in this booming pot-stock niche. I recommended it last September in my Nova X-Report “weed investors’ bible” – The Roadmap to Marijuana Millions – and some of the peak gains we’ve seen there have been extraordinary.
In fact, I can’t think of a better way to show everyone the massive profit potential in legal weed investing.
Rocky Mountain High
The Colorado Department of Revenue reported that 5 million marijuana edibles were sold in the state in 2014. And according to The Denver Post, marijuana-infused edibles account for roughly 45% of that state’s legal marijuana marketplace. A February report by Bloomberg says that edibles account for 50% of the revenue earned by Colorado dispensaries.
Just look at so-called “microdosed” edibles – one of the fastest-growing sectors of the industry.
Microdosed products – from marijuana-infused chocolates and sweets to barbecue sauce and bottled water – contain just 5 to 10 milligrams of tetrahydrocannabinol (THC), the psychoactive ingredient in marijuana that gives you the high. With such small doses, eaters feel the beneficial aspects of marijuana but generally won’t get the unwanted side effects, like feeling “too high.”
Dr. Dustin Sulak, the medical director for Integr8 Health in Maine, has been exploring the benefits of microdosed edibles with patients.
Last year, he told United Patients Group, “I discovered that most people have a certain threshold dosage of cannabis, below which they’ll actually experience a gradual increase in health benefits over time, and above which they’ll start building tolerance, experiencing diminishing benefits, and more side effects.” Dr. Sulak explained that he has witnessed cancer patients respond much better to lower doses than the usual higher dose recommended – while emphasizing the need to experiment as each individual is different.
On the consumer front, companies like Kiva Confections are revolutionizing the microdosing game. Kiva Terra Bites, for example, are bite-sized candies coated in milk and white chocolate infused with marijuana extract. A tin averages $18 and contains 24 servings.
Now, Kiva is a small, privately held business, one I’m watching closely because it may go public in the future.
But there are investment opportunities aplenty in the edibles market.
Here’s one I really like…
Our “Edibles-Plus” Play
Nevada-based Cannabis Sativa Inc. (OTC: CBDS) makes and sells a range of herbal-based skin-care products including salves, balms, and lotions. Gary Johnson, the two-time Libertarian Party presidential candidate and former governor of New Mexico, was part of the group that helped get the company off the ground back in the mid-2000s.
But by far, it’s most exciting and lucrative line of business is edibles. The firm’s Hi-Brand’s International Inc. subsidiary is a major player in the segment.
But it has a lot more going for it.
The timing is excellent.
State governments, especially those where marijuana has become legalized and regulated, stand to benefit immensely from these kinds of businesses, both in job creation and tax revenue. In Colorado, one of the first two states to take recreational marijuana above-board, stores pay a retail and medical sales tax of a 2.9%, along with a 10% retail marijuana sales tax and a 15% marijuana excise tax.
Beyond its push into edible products and store franchises, Cannabis Sativa has also patented a unique strain of pot, something they call “Ecuadorian Sativa,” or “CTA.”
CTA is one of very few weed strains recognized by the U.S. Patent Office, and according to the Los Angeles Times, the company fought for seven years to get that patent. It’s a hybrid plant, composed of strains from Ecuador, for consumers who seek what the firm calls a “ceiling-less high.”
Translation: It’s potent stuff. Really potent.
What’s more, Cannabis Sativa has a bold leap into the “social e-weed” niche with its mobile app iBudtender. Developed by subsidiary iBudtender LLC, this “Yelp of recreational marijuana” offers a directory of thousands of dispensaries, cafés, etc., through which users can locate and educate themselves about certain establishments. It also has voting and review systems (much like Yelp) that allow customers to recommend (or, alternatively, pan) each establishment. In turn, the establishments can interact with customers.
IBudtender is getting rave reviews from users and industry players alike.
Even better, this platform gives the company the opportunity to jump from state to state as legalization spreads and expand into rapidly growing markets at a low cost.
Now, this is a speculative play on a micro-cap stock – just $93.6 million. This isn’t a weed stock to bet the farm on, so make sure you’re using appropriate capital when you buy.
Invest nothing you can’t afford to lose – as this is likely going to be a volatile ride.
My Nova-X members have seen peak gains of 329.9% here, though – and are currently sitting on gains of 134.4% – and that’s simply irresistible.
How to Profit… Beyond CBDS
It took me a year to research stocks like Cannabis Sativa and assemble The Roadmap to Marijuana Millions. And since that 100-page publication debuted, I’ve never stopped my search for the best weed investments.
I’ve now found three small companies – some of them trade for less than $5 now – that are positioned to profit no matter what happens in Washington.
Let’s talk about those – and about where legal cannabis is going – from the July 2018 full legalization in Canada to Congress effectively cutting off weed’s top critic at the knees. In fact, let’s do so in less than a week.
We’ll do it at my special FREE Pot Stock Briefing on Monday, May 15 at 6 p.m. (ET). Consider this your personal invitation…
Click here to reserve your space. My team will follow up shortly after by email with all the details on how to attend.
See you then.
And I’ll see you back here later this week.
- Strategic Tech Investor: Only Inside Access Gets You Info Like This.