Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF) is powering higher in line with the bullish momentum in the sector. The stock is already up by more than 50% for the year. Each pullback has emerged as buy opportunities from where the stock has continued to rally.
Catalysts And Share Price Analysis
The stock is skyrocketing on investors taking note of the fact that the company has evolved to become a leading player in CBD oil. The phenomenon run has also come on the stock picking up some analyst support. Cormark Securities have already initiated coverage of the stock, with a ‘buy’ rating.
The buy rating comes on growing confidence that the company will enjoy robust revenue growth in 2019. For instance, investors expect the company’s revenue to more than double in 2019, in response to the growing demand for cannabis products in the market. CBD sales are soaring, further strengthening the case for Charlotte’s Web Holdings to deliver impressive numbers in 2019.
The stock has also received a boost in the market on reporting more than 10 times growth, in harvested hemp. The company is in the process of processing the hemp using proprietary technology as it looks to use it in its products for sale.
A closer look at recent developments, it does not come as a surprise that Charlotte’s Web Holdings is trading in a steep uptrend. Investor confidence about the company’s growth prospects continues to inch higher by the day. After a spike to the $17 a share level, the stock has since pulled back, to the $15.5 level, in what appears to be a minor correction on investors taking profits.
The pullback faces immediate support at the $14.40 level, from where the stock looks set to continue powering high, in line with the long-term uptrend. Any pullback should emerge as a buy opportunity given the strength of the upward momentum and the fact that fundamentals are turning positive by the day.
About Charlotte’s Web Holdings
Charlotte’s Web Holdings is a hemp-focused company that produces and distributes hemp-based cannabidiol wellness products. The company’s product line is made up of tinctures as well as capsules and topical products.
Positive 2019 Outlook
Charlotte’s Web Holdings is skyrocketing in the market, having emerged it is a solid buy for investors looking to gain some exposure on Canadian’s booming cannabis sector. Being one of the companies leading the industry, when it comes to whole plant extract products, explains why it is a top pick in the sector.
Legalization of recreational use has given rise to new opportunities that the company remains well positioned to capitalize on. A strong balance sheet supported by a robust product line affirms the company’s growth metrics something that continues to excite investors.
Cormark Securities has already initiated coverage of the stock with a ‘buy’ rating and a share price target of CA$25.50. The positive buy rating comes on growing confidence that the company’s revenue will soar to $151 million from $70.1 million delivered in 2018.
In addition, the company’s EBITDA is expected to nearly double to $55.8 million from $23.5 million reported in 2018.
Charlotte’s Web Holdings also continues to elicit strong investor interest in announcing that its hemp harvest for 2018 increased tenfold. With the harvest, the company remains well positioned to address the growing demand for hemp products in Canada and abroad. The company harvested a total of about 67,000 lbs. above initial guidance of between 250,000 lbs. and 350,000 lbs.
“This incredible harvest ensures we can continue to produce our high-quality human nutrition products without being subject to constantly fluctuating market prices as is common with third-party sourced raw material,” said Hess Moallem, President and CEO of Charlotte’s Web.
The company grows its hemp in various regions across the U.S as a way of hedging against weather risks in a particular area. The company currently runs cultivation operations in three states.
What Next for Charlotte’s Web Holdings
Charlotte’s Web Holdings is edging higher as investors react to the huge market opportunity in CBD oil, as many customers are yet to even try CBD oil. Being a market leader in production, the company remains well positioned to generate significant value, especially after a bumper harvest.
The stock is not cheap on a valuation standpoint, especially after the recent spike. However, the stock looks set to continue edging higher as the company’s position as a market leader should allow it to continue growing in valuation. Opportune investors should look out for the dips as an opportunity to get an exposure to a top cannabis play.
We will be updating our subscribers as soon as we know more. For the latest updates on CWBHF, sign up below!
Disclosure: We have no position in CWBHF and have not been compensated for this article.