Canopy Rivers Inc (OTCMKTS: CNPOF) is one of the beneficiaries of the cannabis market boom. It thus does not come as a surprise that the stock has started heating up, after a rollercoaster 2018. The stock has already bottomed out from one-year lows as investors react to a string of developments that affirm the company’s growth metrics.
CNPOF Share Price Analysis
Top on the list is the confirmation of a strategic partnership with LeafLink Inc. for the deployment of a market-leading B2B software platform. The company has also entered into an alliance with Nelsen Holdings for the provision of cannabis market data and analytics.
The company balance sheet did receive a boost of $93.5 million, on the closing of a private placement. With the new finances, the company remains well positioned to pursue strategic initiatives, ideal for accelerating growth.
A 120% plus spike helped push the stock from the $2 a share handle at the start of the year, to highs of $4.4. The stock did pull back to the $2.80 mark, in what appears to be a minor correction on investors taking profits.
Canopy Rivers has since again started surging at the back of high turnover in traded shares. Price action activity indicates immediate resistance on further rallies is at the $4.40 level. A breach of the crucial technical level should open the door for the stock to continue climbing the ladder.
The stock needs to rise and stabilize above the $4.40 mark, to avert further slides in the market. Below the $4.40 technical level, the stock remains susceptible to further drops given the underlying long-term bear trend.
About Canopy Rivers
Canopy Rivers casts itself as a public investment firm focused on opportunities in the emerging global cannabis sector. In partnership with Canopy Growth, the company strives to identify and support counterparties, seeking financial and operational support in the cannabis industry.
Canopy Rivers is a potential bounce-back play, given the underlying developments that continue to shore investor sentiments in the stock. The company is fresh from forming a joint venture with LeafLink Inc.
Dubbed LeafLink Services International ULC, the joint venture is to license and leverage LeafLink’s Business-2-Business marketplace and supply chain technology on international cannabis markets.
“We have been very impressed with Leaf Link’s deep market penetration and their understanding of cannabis companies’ needs and behaviors. The number of brands and products within our new cannabis economy has been explosive, making it difficult for retailers to deal with multiple parties in an increasingly fragmented market,” said Narbé Alexandrian, President of Canopy Rivers.
Formation of the joint venture expands Canopy Rivers exposure across the cannabis value chain, given its access to a robust market-leading B2B platform. The company should be able to integrate its network of complementary cannabis companies and global reach to drive growth.
In addition, the company has entered into an alliance with Nielsen Holdings through its portfolio company, Headset Inc. The two are to work together to enable consumer packaged goods to understand the changing dynamics in the cannabis industry better.
“This announcement from Headset and Nielsen validates our belief in the importance of data in the rapidly unfolding and brand-intensive cannabis industry. Partnering with Nielsen, an S&P 500 company and global market leader in consumer data and insights, marks a significant step forward for Headset in its goal to help companies make more informed business decisions through data,” said Mr. Alexandrian.
The formation of the joint ventures could not have come at a better time given that Canopy Rivers is fresh from generating $93.5 million in gross proceeds from a bought deal. With the new finances, the company intends to carry out follow-on investments in its portfolio of companies.
Plans are also underway to carry out new domestic and international investments all in the effort of exploring new opportunities for growth.
Canopy Rivers has turned to strategic partnerships and alliances as it seeks to reinvigorate its growth prospects in the cannabis sector. A partnership with LeafLink and Nielsen Holdings paves the way for the company to strengthen its prospects in niche markets, across the multibillion-cannabis sector.
Investor reaction to the development has so far been positive if a spike in share price and market activity is anything to go by. As it stands, the stock is a bounce back play, in line with the bullish momentum in the cannabis sector.
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Disclosure: We have no position in CNPOF and have not been compensated for this article.