California Cannabis Market Expected to Reach $5.1 Billion Market Value

Tuesday, June 19, 2018 Drug News
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PALM BEACH, Florida, June 19, 2018 /PRNewswire/ --

Marketnewsupdates.com Market Commentary 

The

cannabis market could triple in size in the next four years, according to Arcview Market Research and BDS Analytics new report, 'The State of Legal Marijuana Markets'. In fact, by 2022, the global cannabis market could be worth as much as $32
billion
, a three-fold increase in just five years with the U.S. expected to fuel much of that growth with an expected market value of $23.3 billion. Much of the current growth we're seeing comes from California's cannabis market, which is expected to exceed $5.1 billion market value in the next year after legalizing its recreational use on January 1, 2018. Several legitimate cannabis market players include High Hampton Holdings Corporation (CSE: HC) (OTC: HHPHF), CannaRoyalty Corporation (OTC: CNNRF) (CSE: CRZ), CannTrust Holdings (TSX: TRST), Canopy Growth (NYSE: CGC) and MedReleaf Corporation (OTC: MEDFF).

With sizable growth in store for California's massive cannabis market, investors have been increasingly attracted to companies with exposure to the state, including High Hampton Holdings and its 10.8-acre property in Coachella, California, as well as CannRoyalty Corporation and its strong focus on California's cannabis consumer products goods.

California Legal Marijuana Attracting Big Business 

With nearly 40 million residents and more than a million medical marijuana patients, California's market represents about a third of the North American cannabis market. Months after California legalized recreational marijuana, BDS Analytics estimates that sales could hit $3.7 billion by the end of 2018, as reported by Business Insider, predicting that number will reach $5.1 billion by 2019. Analysts at Cowen & Co. believe the nation's legal cannabis industry could reach $50 billion by 2026, with California accounting for about $25 billion of that market, according to CFN Media Group.

Given the market growth, it's no surprise that companies are increasing their stake in California.

CannaRoyalty Corporation is just one of a growing number of larger Canadian companies that are increasing their share of the market for example. The company recently acquired RVR, a large-scale distributor of both medical and recreational cannabis, Alta Supply, a smaller medical marijuana company, and Kaya Management, an edibles and vaporizer producer. In April 2018, it also acquired Flora-Cal Farms, a licensed ultra-premium cannabis producer.

MadMen Enterprises recently broke ground on a high-tech cannabis factory in Desert Hot Springs, California, the company's second large-scale marijuana cultivation and manufacturing facility, reports New Cannabis Ventures. "The Desert Hot Springs facility is scheduled to open in early 2019 and service California's fast-growing adult-use marijuana market."

Even High Hampton Holdings Corporation (CSE: HC) (OTC: HHPHF) is just beginning to gain momentum, advancing its foothold in California's cannabis market through acquisitions and property development.

High Hampton Holdings' Dominance in California 

High Hampton Holdings offers an interesting opportunity in the state's cannabis market, as it actively seeks to consolidate California's cannabis industry through equity, royalty and direct property ownership with licensing agreements. For example, the company's CoachellaGro Corp. is developing a 10.8-acre property that it plans to develop into a cannabis industrial park. On May 2, 2018, the City of Coachella's Planning Commission granted a conditional use permit for the cultivation of marijuana.  

"With a conditional use permit for CoachellaGro in hand, we have created instant added value for this asset which will remain the cornerstone of our business model and be complemented by the aggressive acquisition process we have begun this spring as we consolidate the California cannabis market," said High Hampton CEO David E. Argudo.

The company also announced it had entered into a binding agreement with 8 Points Management and its subsidiary Bravo Distro, a fast growing California cannabis distributor, to acquire 100% of all issued and outstanding shares of both 8 Points and Bravo. The deal will provide High Hampton Holdings with immediate access to a major distribution hub in Sacramento, California.

"Securing distribution is a crucial if not the most important component of a successful business model for the California cannabis market," says CEO Argudo. "In 8 Points Management we have found a well-positioned operator that offers a full-service distribution model for our industry that will help us establish access to major distribution hubs in strategic locations throughout California including a prominent location in West Sacramento. Their team is renowned for already starting and operating another highly successful cannabis distribution outlet, and together, we are poised to succeed in building a leading cannabis distributor in California."

With a market cap of less than $65 million, investors are increasingly attracted to the company, especially with several catalysts for growth, including the Coachella property and the recent acquisitions of 8 Points Management and Bravo. It would appear the company is in the early stages of actively consolidating California's growing cannabis market to increase its value.  

Potential Comparables in the industry include: 

CannaRoyalty Corporation (OTCQX: CNNRF) (CSE:CRZ) is a private equity firm specializing in acquisitions. The firm invests in the legal cannabis sector with a focus on research and intellectual property, consumer brands, and industry infrastructure with a strong focus on California, one of the world's largest cannabis markets.  

CannTrust Holdings (TSX: TRST) produces and distributes pharmaceutical grade medical cannabis products in Canada. It sells dried cannabis and oil extractions to the client based on the medication document provided by health care practitioner. 

Canopy Growth (NYSE:CGC) through its subsidiaries, produces and sells medical marijuana in Canada. The company offers dried, oil, and soft gel cannabis products. Canopy Growth Corporation also sells its products through online.

MedReleaf Corporation (OTCPK: MEDFF) produces and sells cannabis-based pharmaceutical products in Canada. It offers dried cannabis, cannabis oils, and cannabis oil capsules; and various accessories, including grinders, vaporizers, and lockable containers.

For a more in-depth look at High Hampton Holdings Corporation (CSE: HC.CN) (OTCPK: HHPHF), please read the full report on MicroSmallCap.com.

DISCLAIMER: Microsmallcap.com (MSC) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. FN Media Group (FNM) is a third-party publisher and news dissemination service provider, which disseminates electronic information through multiple online media channels. FNM is NOT affiliated with MSC or any company mentioned herein. The commentary, views and opinions expressed in this release by MSC are solely those of MSC and are not shared by and do not reflect in any manner the views or opinions of FNM. Readers of this Article and content agree that they cannot and will not seek to hold liable MSC and FNM for any investment decisions by their readers or subscribers. MSC and FNM and their respective affiliated companies are a news dissemination and financial marketing solutions provider and are NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.   The Article and content related to the profiled company represent the personal and subjective views of the Author (MSC), and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author (MSC) has not independently verified or otherwise investigated all such information. None of the Author, MSC, FNM, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer's filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer's securities, including, but not limited to, the complete loss of your investment. FNM was not compensated by any public company mentioned herein to disseminate this press release but was compensated forty four hundred dollars by MSC, a non-affiliated third party to distribute this release on behalf of High Hampton Hldgs Corp.

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This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. "Forward-looking statements" describe future expectations, plans, results, or strategies and are generally preceded by words such as "may", "future", "plan" or "planned", "will" or "should", "expected," "anticipates", "draft", "eventually" or "projected". You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company's annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and MSC and FNM undertake no obligation to update such statements.  

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SOURCE MarketNewsUpdates.com



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