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Cannabis Market Attracts U.S. Cigarette Makers As Well
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Altria Group Inc. (MO - Free Report) , America’s leading cigarette manufacturer, is in talks with Canadian cannabis producer Aphria Inc to buy a stake in it, The Globe & Mail reported last week.
Altria, parent of Marlboro cigarette-maker Philip Morris USA, is making the move at a time when Canada is set to legalize recreational marijuana on Oct 17.
This could be one of the reasons why many consumer goods’ manufacturers, food and beverage giants are trying to partner with Canadian cannabis growers in recent months.
Marijuana’s Benefits and Market Growth Opportunities Entice Cigarette Makers
The marijuana industry is expected to reach $146.4 billion by 2025 end, at a compound annual growth rate of 34.6%, according to Grand View Report. This could be prompting American cigarette manufacturers to seek an entry into the booming cannabis market.
The legalization of medical and recreational marijuana could offer unlimited options in terms of newly formulated products that could attract health-conscious consumers.
Smoking marijuana for medical purposes has been legal across 29 states in the United States since January while recreational marijuana is legal in 9 states.
Benefits of medical marijuana include curing and preventing eye diseases such as Glaucoma, controlling epileptic seizures, decreasing anxiety, easing pain induced by arthritis etc.
Marijuana-infused beverages and food products captured the attention of major American giants such as Coca-Cola Company (KO - Free Report) and PepsiCo (PEP - Free Report) . Earlier this year, these two companies announced their interest in preparing cannabidiol-infused products. Cannabidiol (CBD) is a non-psychotropic drug found in the cannabis plant and its benefits include curing seizures, reducing inflammation, preventing cancer from spreading rapidly and decreasing pain.
Major Investments Promise Solid Growth Prospects
Marijuana stocks have witnessed an uptick in their prices since mid-August when Constellation Brands (STZ - Free Report) confirmed it plans to invest an additional $4 billion in Canada’s Canopy Growth Corporation (CGC - Free Report) . The Corona beer maker had acquired a 9.9% stake in Canopy Growth in October 2017.
Not a month later, Coca-Cola expressed its interest to invest in Aurora Cannabis. This was followed by PepsiCo’s inclination toward making investments in the marijuana industry. While Coke and Pepsi could be eyeing new food and beverage products, Altria’s plans to formulate new consumables in place of its classic cigars remain to be seen.
The increasingly changing preferences of consumers and the legalization of cannabis across Canada and many states in the U.S. indicate solid growth prospects for the Marijuana-exposed stocks.
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Cannabis Market Attracts U.S. Cigarette Makers As Well
Altria Group Inc. (MO - Free Report) , America’s leading cigarette manufacturer, is in talks with Canadian cannabis producer Aphria Inc to buy a stake in it, The Globe & Mail reported last week.
Altria, parent of Marlboro cigarette-maker Philip Morris USA, is making the move at a time when Canada is set to legalize recreational marijuana on Oct 17.
This could be one of the reasons why many consumer goods’ manufacturers, food and beverage giants are trying to partner with Canadian cannabis growers in recent months.
Marijuana’s Benefits and Market Growth Opportunities Entice Cigarette Makers
The marijuana industry is expected to reach $146.4 billion by 2025 end, at a compound annual growth rate of 34.6%, according to Grand View Report. This could be prompting American cigarette manufacturers to seek an entry into the booming cannabis market.
The legalization of medical and recreational marijuana could offer unlimited options in terms of newly formulated products that could attract health-conscious consumers.
Smoking marijuana for medical purposes has been legal across 29 states in the United States since January while recreational marijuana is legal in 9 states.
Benefits of medical marijuana include curing and preventing eye diseases such as Glaucoma, controlling epileptic seizures, decreasing anxiety, easing pain induced by arthritis etc.
Marijuana-infused beverages and food products captured the attention of major American giants such as Coca-Cola Company (KO - Free Report) and PepsiCo (PEP - Free Report) . Earlier this year, these two companies announced their interest in preparing cannabidiol-infused products. Cannabidiol (CBD) is a non-psychotropic drug found in the cannabis plant and its benefits include curing seizures, reducing inflammation, preventing cancer from spreading rapidly and decreasing pain.
Major Investments Promise Solid Growth Prospects
Marijuana stocks have witnessed an uptick in their prices since mid-August when Constellation Brands (STZ - Free Report) confirmed it plans to invest an additional $4 billion in Canada’s Canopy Growth Corporation (CGC - Free Report) . The Corona beer maker had acquired a 9.9% stake in Canopy Growth in October 2017.
Not a month later, Coca-Cola expressed its interest to invest in Aurora Cannabis. This was followed by PepsiCo’s inclination toward making investments in the marijuana industry. While Coke and Pepsi could be eyeing new food and beverage products, Altria’s plans to formulate new consumables in place of its classic cigars remain to be seen.
The increasingly changing preferences of consumers and the legalization of cannabis across Canada and many states in the U.S. indicate solid growth prospects for the Marijuana-exposed stocks.
You can see the complete list of today’s Zacks #1 Rank stocks here.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>