Hexo Corp. (NYSE: HEXO) is a Canadian cannabis company that produces adult-use and medical marijuana. The company’s brand is quickly becoming one of the most valuable in the wider industry.
Hexo has recently partnered with Molson Coors, a global alcoholic beverage brand, to produce a THC-infused drink that will release in Canada later this month. For Hexo, it will bring increased exposure and brand recognition. As more players enter the cannabis market, prices will be pushed down. Companies that can differentiate their brand will have a huge advantage.
Hexo’s revenue is expected to increase threefold over the next year. In the 2019 fiscal year, the company generated 863.55% year over year revenue growth. This kind of expansion is unheard of in most industries. While the company still operates at a loss, increasing its sales at a rapid pace will eventually help it to turn the top-line revenue into solid income. Investors willing to wait for profitability can buy the stock for a bargain price today.
The legal cannabis market in Canada will reach over $3 billion in sales by the end of this year. Long term, analysts expect the total North American market to be worth $100 billion. Federal legalization seems inevitable in the U.S., with some analysts predicting it will occur within this decade.
Getting in on the market from the bottom is the best way to secure returns. This stock’s price and potential make it a strong pick for 2020.
- 1 Year Price Growth: -79.49%
- YTD Price Growth: -29.56%
- 3 Month Price Growth: -48.15%
All information is based on current and historical market data, as well as publicly available financial data. As with any financial decision, your own research is important. Stock market outcomes can never be 100% accurately predicted. Familiarity with historical data, individual industries, and individual stocks is key to developing a robust portfolio. Note that stock prices can fluctuate rapidly during trading sessions.