Expert Trader Samuel Leach: Infused Drinks Market Set For Growth

By Ernest Hamilton

Feb 10, 2021 10:53 AM EST

Expert Trader Samuel Leach: Infused Drinks Market Set For Growth(Expert Trader Samuel Leach: Infused Drinks Market Set For Growth) (Credit: Getty Image)

Stock and Forex Trader Samuel Leach from Samuel and Co Trading, recognised as one of Yahoo Finance's Top Traders To Follow in 2020, ranked 7th in the Fintech Disruptor Awards (2020) and the subject of "The Real Forex Trader" documentary, had this to say about investing in the Infused-Beverage Market and BevCanna Enterprises Inc. (CSE:BEV) (OTC:BVNNF) in particular.

As attitudes towards CB-infused products (Cannabidiol, derived from Hemp) have liberalised over recent years, and its medical applications have become better understood and have diversified, there is an expectation that this market will grow fast, some reports indicating that it will rise to $4.4 billion in the coming 4 years. This is all the more so as this consumables sector has shifted from snacks (think "brownies") to health and wellness foods and products. Many big players are looking into this area, and Goop CEO Gwyneth Paltrow has heralded CB-infusions as the "hero ingredient of the future".  

Parallels are being drawn to the growth seen by energy drinks in previous years. Monster Beverage's stock shifted from $6.31 to $92.50 over the last decade, and some are expecting a replication in this sector, and for BevCanna Enterprises Inc. in particular.  

BevCanna manufactures CB-infused drinks and health products, for both in-house brands and white labels, from its large scale HACCP certified facility with capacity for the production of 210 million bottles per annum, and they are at the final stages of seeking Health Canada Standard Processing License to support manufacture. But it appears that BevCanna is boldly growth-oriented in outlook. 

BevCanna has acquired a direct-to-consumer e-commerce company with skin in the CB-infusion and natural health products 'game' across North America and Europe. In addition, Naturo Group and BevCanna have entered into a definitive agreement with a view to place BevCanna as a comprehensive health and wellness undertaking. BevCanna will hope to secure the advantages of being a 'development to distribution' company, with direct ownership of an on-site natural spring water aquifer to secure increasingly scarce water resources. Also, it will make available significant cultivable land, ideal for the agricultural production stage of manufacture. 

Also, Keep Brands, one of the largest CB-Infused US drinks companies have taken an equity position in BevCanna with a promising future for both parties. BevCanna has secured a $5 million Capital Injection which was fully-subscribed leading to $3.5 million coming from an above-market offering of c$1.50, explainable by the company's progress against key initiatives and the growth in the broader market. Funding is expected to support international and internal expansion, particularly as the Naturo deal approaches, and with a view to the distribution of Keef's Trace branded product range. 

BevCanna Enterprises Inc. has a leadership team with extensive experience within the Marketing and sales, wellness and food industries and related sectors which bodes well for robust Corporate Governance within this sector, with consequential benefits in terms of RoI. 

Significantly BevCanna's technicals look strong and promising for the foreseeable future. Within 2020 its stock offered a 280% return, and with indicators looking good for the sector as a whole, as well as the company in particular, some are looking for a return to a 2019 high of $1.20 or higher in the near future, with more to be offered mid-term. Indicators including its 20-day MA, 50-day MA, 100-day MA and 200 day MA, as well as various  MACD oscillator measures over the same period looking favourable. 

I consider further research in BevCanna Enterprises Inc. is merited for the following reasons: 

  1. As the approach to CB-infusion becomes more mainstream the market is expected to expand  from $89 million to $1.4 billion in three years and by c. $3 billion by 2025;

  2. BevCanna is taking a more central position in the market. Keef Brands is taking an equity position, and BevCanna is targeting M&A opportunities, including an agreement to acquire Naturo Group to become a holistic health and wellness company, and Pure Therapy as its direct-to-consumer e-commerce company which delivered $7.1 million EBITDA this year;

  3. BevCanna has completed a $5 million capital injection with $1.50 per unit above-market offering securing $3.5 million;

  4. BevCanna predicts revenues to increase to $40 million by 2022, in a growing market. 

With world-class infrastructure, a bullish mergers and acquisition approach, and the promise of doubling revenue within the next 2 years, BevCanna Enterprises Inc. stocks are worth a further review - see its website for your own due diligence. 

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