New Age Beverages (NBEV) has soared from $1.59 in September to the current 52-week high of just over $6. Part of the stock’s increase can be attributed to the recent spike in interest in the company’s unique beverages, which include products that are cannabidiol-based. New Age also attracted considerable investor interest following a recent acquisition and the general overarching society-wide transition toward the acceptance of marijuana.
New Age is a Colorado-based business that makes all-natural, healthy and organic beverages. These drinks are marketed as superior to alternatives in nearly every way. New Age’s unique twist on healthy beverages is the addition of CBD derived from marijuana. CBD is the non-euphoric chemical in marijuana that has since been used as sleep medicine and even for treating seizures in states that allow it. It does not have the same effect as THC, the chemical associated with getting high by using the drug. Nevertheless, it wasn’t long ago when both chemicals were treated as being the same.
Though CBD-infused liquids were once taboo, these drinks will soon be at the forefront of pop culture. At a bare minimum, those interested in health and the battle against cancer will consider the merits of CBD-infused beverages.
New Age sells everything from CBD sparking water to CBD green tea and CBD shots. Each of these CBD-infused delights has 25 mg of CBD. However, there is absolutely no THC, meaning the drink does not provide the psychedelic high associated with marijuana. Each New Age beverage is completely safe and tasty. It is a mistake to assume those who use New Age Beverages’ products are looking for a way to get high. In reality , the company’s products do not make customers high. Rather, these products are meant to relax, take off the edge, minimize pain and promote well-being. There is nothing illegal about New Age’s offerings, so don’t assume an investment in this company is unsafe for this reason. In fact, as time progresses, more and more people consider the medicinal properties of marijuana to be a blessing in disguise.
Of course, it isn’t just the trendy products that are fueling the company’s growth…
New Age acquired Morinda, a healthy beverage business, with trailing revenue nearing $350 million. The Morinda acquisition significantly bolsters New Age’s presence in Asia. Morinda is a fit at a purchase price of $85 million as the company has its own unique portfolio of idiosyncratic health-oriented beverages. The addition of Morinda provides New Age with access to more than 60 new markets across the globe. Morinda’s $300 million-plus in net revenue will allow New Age to scale as appropriate in the months and years ahead.
New Age is perfectly positioned to take advantage of the gradual legalization of marijuana, including its CBD components. The company has already reached distributor and retailer agreements in several legal states ranging from Oregon to California, Washington and Colorado. All in all, New Age’s commitments cover 125,000 distribution points across DSD and independent channels. New Age’s push to obtain commitments from numerous top retailers prior to the President’s signature on new relevant legislation (the Farm Bill) will help the company bring its CBD-infused items to the masses as quickly as possible.
When debating whether to invest in a company like New Age, investors must gauge whether the business’s offerings have staying power. Try to envision what society will be like in a decade or two. If you envision one-stop shops with healthy beverages featuring CBD and other once-taboo ingredients, you are not alone. It appears as though companies like New Age are ideally positioned for the growth in the non-alcoholic beverage market currently worth more than one trillion dollars. New Age is one of the fastest growing beverage businesses in the world across the past two years, so there is legitimate hope for meteoric growth once the company hits its stride.
The question is how popular CBD beverages and other products will become. It appears as though CBD really does benefit the body to the point that it will likely be used for health improvement for years to come. Though New Age’s stock has been quite volatile since moving into the CBD space, it is clear investors are more than willing to invest in marijuana-related businesses. The new Farm Bill is set to legalize cannabis with minimal THC that will almost surely propel the hemp-CBD space to more than $22 billion in the next half-decade. The challenge is in determining how quickly CBD products will reach a mainstream saturation point. As of now, New Age has 125,000 distribution points. If you believe in the power of CBD and would like a piece of this growing economic pie, New Age Beverages is definitely worth consideration as a long-term investment.