1 Explosive Weed Stock That Could Double in 2021

Charlotte’s Web could be the explosive weed stock to double your money this year as the leading CBD wellness product manufacturer posts impressive performance.

| More on:

Weed stocks have not had the best time in recent years. Popular cannabis stocks boomed leading up to recreational cannabis legalization but declined soon after. 2021 paints a different picture for the legal cannabis industry.

The election of Joe Biden in the U.S. and improving chances of federal legalization across the border is causing more capital to flow into the marijuana industry. The current appreciation in Canadian weed stocks has strong cash flow backing it. Cannabis companies managed to raise approximately US$2.6 billion only in the first half of 2020 as funding was tight amid the pandemic.

The United Nations Commission on Narcotic Drugs decided to remove cannabis from the strictest schedule under the Single Convention on Narcotics in December 2020, which means that the chances of federal legalization are stronger than ever.

Naturally, a return to better conditions means a bullish trend. Cannabis investors who threw in the towel previously might be busy picking their favorites among established giants like Canopy Growth and Aphria.

However, there is an underrated weed stock in Canada that could provide investors with more explosive returns than the battered cannabis industry giants. It is even possible that the valuation of this weed stock could double this year.

Leading CBD wellness producer

Charlotte’s Web (TSX:CWEB) is a Boulder, Colorado-based manufacturer and distributor for hemp-based cannabidiol (CBD) wellness products. The vertically integrated company does not produce any medicinal or recreational marijuana, but it is the leading global CBD wellness product manufacturer.

The company’s focus on this niche within the cannabis industry gives it a significant advantage over its peers because CBD is already largely legal throughout the U.S. The company recently launched its new THC-Free 25mg CBD Oil Tinctures. It is possible that its latest CBD wellness product could spur significant growth for the company.

Charlotte’s Web’s primary target audience includes essential workers like healthcare providers, civil service employees, police officers, firefighters, and many others. Most of these people are in high-stress work environments and become extremely exhausted due to their jobs. Charlotte’s Web’s THC-Free wellness product offers these workers a trouble-free stress reliever.

International expansion

The company also signed an exclusive deal for distribution agreement with InterCure Ltd. This company owns Canndoc, one of the most significant medical cannabis producers in Israel. This strategic partnership could immensely benefit Charlotte’s Web because Canndoc is a leading entity in pharmaceutical-grade cannabis.

Canndoc also holds international cultivation and distribution agreements in the European Union. It means that Charlotte’s Web may begin selling its product through this partnership in Israel and possibly in certain EU countries in the future.

Foolish takeaway

Charlotte’s Web is trading for $5.69 per share at writing and is down almost 80% from its all-time high in August 2019.

The stock could be an excellent investment to consider for your portfolio if you seek rapid wealth growth in the short-term and long-term sustainable growth. You can initiate a position in the stock today and capitalize on the gains when the breakout comes.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Charlotte's Web Holdings.

More on Investing

think thought consider
Tech Stocks

Is CGI Stock a Buy Even With No Dividend Yield?

CGI stock may not have a dividend to speak of. But does that necessarily mean you should ignore this top…

Read more »

A robotic hand interacting with a visual AI touchscreen display.
Tech Stocks

Why Now Is the Time to Invest in Canadian AI Stocks

Are you looking for one of the most solid Canadian AI stocks out there? This one is probably your best…

Read more »

The letters AI glowing on a circuit board processor.
Tech Stocks

Why AI Stocks Should Be in Every Canadian Investor’s Portfolio

AI stocks continue to be one of the best options out there for long-term investing, especially when considering Canadian options.

Read more »

stock research, analyze data
Bank Stocks

Canadian Bank Stocks: Buy, Sell, or Hold?

There are opportunities and risks on the horizon for the Canadian banks.

Read more »

Young Boy with Jet Pack Dreams of Flying
Stock Market

Is Air Canada Stock a Good Buy After Its Q3 Results

Down almost 60% from all-time highs, Air Canada is an undervalued TSX stock that remains an enticing investment in November…

Read more »

cloud computing
Investing

Where to Invest $10,000 in November

Given their solid underlying businesses and healthy growth prospects, I expect these two defensive stocks to outperform uncertain outlook.

Read more »

coins jump into piggy bank
Retirement

Here’s the Average RRSP Balance at Age 44 for Canadians

Holding stocks like Alimentation Couche-Tard (TSX:ATD) in an RRSP is a good way to build your wealth.

Read more »

dividends can compound over time
Dividend Stocks

Want a 7% Yield? The 3 TSX Stocks to Buy Today

These TSX stocks are offering high yields of over 7%, making them attractive for investors seeking steady passive income.

Read more »