When you think about which pot stock is going to hit $100 first, you might think it will be CGC, APHA, TLRY, maybe even SNDL. But none of these will see $100 before this stock does. They are keeping quiet on it right now, they being the media, Stocktwits, and Redditt. But eventually this stock will be in the headlines of the Wall Street Journal, Motley Fool, Seeking Alpha, and Zacks. This is going to be a stock that defines the year 2021. When we look back, we will talk about GME, AMC, VUZI and this top cannabis player. That top cannabis player is HEXO.
How HEXO Becomes #1
The media is trying to keep you out of this. One, they constantly warn of investing in Canadian Licensed Producers, and recommend MSO’s instead. Yes MSO’s will do well, and they are the safe choice, but these Canadian LP’s are preparing for a larger move, a global empire. Two, even when the industry is brought up on a segment or article, HEXO is not even mentioned. Bigger names like APHA, TLRY, ACB, SNDL, and CRON are brought up instead. But for some reason HEXO has got massive attention from institutions which are loading up on HEXO while its still cheap. Hexo has an interesting strategy that is going to propel them to become the number one cannabis stock on the market. Not only will they be the global leader in the cannabis industry, but one of the best growth stocks on the market. Here’s why.
Reason One: The Strategy
Hexo is ahead of their competitors, way ahead. They are making moves that are going to set them up to become a global leader in the industry. SNDL is not even looking to leave Canada, APHA & TLRY act like they are ready, and CGC’s products are not meeting consumers standards. Hexo’s strategy is genius, and is what is going to make you rich. Hexo’s strategy is to partner with famous, well-known brands that consumers already identify with, use their distribution channels and establish their brand in the US first. If I had to compare it to anything it would be Shark Tank. They are that small company that is reaching out to “sharks” to become even bigger. Yes, they are going to have to sacrifice some of the revenue, but, they will get 50% of a dollar instead of 100% of a quarter. Using partnerships gives consumers a option to a brand they are already familiar to when these products begin to role in to town. HEXO will also be able to use Molson’s distribution channels. This allows them to spread fast, as these pre-existing distribution channels are just waiting for the green light to send Hexo products… global. The CEO himself says that as soon as legalization comes, they will be ready for their products to spread through the US instantly. Other Canadiens will try to build from the ground up, leaving months and months of time for HEXO to establish their brand where others can not. You won’t see APHA, TLRY, SNDL products in the early stages of legalization. Your going to see HEXO and maybe CGC. They already are making beverages with Molson Coors. They have plans to venture into the edible and vape industry as well. A rumor that has been flying around is that HEXO is planning on partnering with Mondelez International, the producer of Oreo’s and Sour Patch Kids. In the vape industry, there is rumor that they are going to partner with Phillip-Morris International, a 100 B market cap company. There will be many more partnerships down the road, possibly even Coke. Yes, Hexo has brought up Coke in past investor conferences. Just remember, HEXO will be the first company you see spread across America.
Reason #2: The Quality
Hexo didn’t have the best quality at first. I mean lets not lie, almost every Canadian LP had bad flower, some still do. But Hexo has chosen to listen to its consumers and have improved their process. They are now providing fresh bud to their consumers, that is of the highest quality, at a relatively low price. There beverages are taking off, more like exploding, in Canada. Their House of Terpenes, Little Victory, and Molo brands have taken the top four spots of best selling beverages in Canada, as well as the number 8 spot. Their bud also took the top 3 and number 5 spot of best selling brands in Canada. Kind of weird how they are not talking about this stock right? They like it cheap, institutions want cheap shares. They are already showing signs of early success, and the best part about it is that they are growing rapidly. They went from the 17th biggest LP in Canada two years ago, to moving from #4 to #3 two weeks ago after the acquisition of Zenabis. The way things are moving now, they could be #1 eventually.
Reason #3: The Environment
We are in the beginning stages of cannabis becoming mainstream. This industry is set to boom, and we are already seeing early signs of it. We are seeing revenues in Canada growing fast, and the popularity of beverages is beginning to blow up. Not only are we seeing signs in Canada, but the US is showing the beginning phases of preparation for a massive industry. Bars are starting to add CBD products to the menu. What do you think the bars are going to do when Molson Coors opens up their cannabis-infused products statewide? Bars are going to choose the familiar, well-known brand. When THC drinks start hitting the market, HEXO will be the first drinks to hit these bars, along with CGC. That’s instantly putting them as a top two player in the American market, and if consumer preferences stay the same in the US as they are in Canada, HEXO clearly wins the battle as the number one cannabis beverage brand in the US. Without a partnership with a major brand like that, I don’t see MSO’s being able to distribute their products fast at first. Also consumers will not recognize these brands, and will grow by word of mouth, which is a slow process. I think MSO’s will thrive in some areas of the cannabis market, but your looking at a ten to fifteen year play before you see extremely nice returns on your investment. Hexo already has the infrastructure in place to become the industry leading cannabis brand globally, and are looking to add more partnerships in the near future. The world is becoming more and more cannabis friendly by the day, and it’s a matter of time before the industry blows up. Any pot stock will do well at first, but fundamentally, HEXO will be your leader for years and years to come.
You may be attached to a certain pot stock now, but you need to seriously evaluate your companies plan to enter US markets, and global markets in general. Now is the time that intelligent investing in this industry can make you a multi-millionaire five or ten years from now with under 50k. Do not worry about short term movement as fundamentals will prevail over time. After researching a lot of the cannabis stocks, I have not seen one better prepared for global expansion than HEXO. Institutions are loading up on it, and the media is keeping quiet about it. It is unbelievably cheap, sitting at a $784.3 million market cap. The CEO himself said he believes they can be worth 50B-100B one day. That’s roughly a $410-$820 stock price prediction on his part, of course their will probably be splits on the way up. The CEO has proved many people wrong over the years and I consider him the Elon of the cannabis industry. He started this company with only $35,000 and has been able to see it become a billion dollar company in under 10 years. He also focused on the beverage industry first, while other CEOs thought he was crazy. Now HEXO is the leader in the beverage industry, and other CEO’s are rushing to make beverages of their own as they see the market for it exploding. This guy is smart, and I am willing to invest my hard earned money in his company as I see a high ROI over the next five years. Add this to your watchlist, and watch this sky rocket the next five years.