Why Investors Should Be Focusing on Cannabis Edibles

Cannabis edibles are rapidly taking market share from flower. While there are many startups targeting the edibles space, investors may want to consider companies that have already established a reputable brand and distribution network. These companies may be better positioned to launch edibles to existing customers while benefiting from the improved economies of scale due to their other operations.

In this article, we will take a look at these trends and why Grown Rogue Inc. (CSE: GRIN | OTC: NVSIF) is well positioned to benefit from these trends over the coming year.

Edibles Will Reach $4 Billion by 2022

There’s no doubt that cannabis edibles will surpass flower in popularity, but the category has surpassed even the most bullish expectations. ArcView Market Research believes United States and Canadian consumers will spend some $4.1 billion on cannabis edibles by 2022, representing about 14 percent of the entire cannabis industry’s revenue. Cannabis flower revenue is projected to drop from 50 percent to just 36 percent over the same timeframe.

Investors should consider companies with a strong presence in the edibles market as opposed to those focused exclusively on flower. While the Canadian edibles market remains in its infancy, the United States market has experienced tremendous growth in California, Colorado, Nevada and other markets where recreational cannabis has been legalized. These markets may offer the greatest near-term growth potential.

In addition to faster sales growth, cannabis edibles makers could also benefit from the wave of mergers and acquisitions by multinational food and beverage companies. Constellation Brands’ $4 billion investment in Canopy Growth Corp. and Molson Coors Brewing Co.’s plans to develop cannabis beverages are evidence that many large companies are taking an interest in the nascent cannabis industry—and particularly cannabis edibles.

Building a Leading Edibles Business

Many cannabis companies have only been around for a few years, and many others were started by Wall Street bankers rather than cannabis enthusiasts. While capital can build production facilities and power marketing campaigns, it takes cannabis experts to create great products that consumers will stick with over the long-term. Investors should consider companies with strong executive teams in both areas.

Grown Rogue Inc. (CSE: GRIN | OTC: NVSIF) was founded by Obie and Sarah Strickler, who have been involved with the cannabis industry for over 15 years. In Oregon, the two created and managed a successful medical cannabis operation in the industry’s early days before launching Grown Rogue in 2016 to enter the recreational market. The company has products in over 220 Oregon dispensaries and plans to expand into California early this year.

The company began by selling premium cannabis flower, high-end pre-rolls, quality oils, and various forms of shatter. Since then, they expanded into the cannabis edibles business through strategic partnerships with food experts. The company recently partnered with Jeff Shepherd, a world-renowned chocolatier, to develop THC- and CBD-infused chocolate products that will be marked under the GRAM and Grown Rogue brands.

Looking Ahead

There’s little doubt that cannabis edibles will continue to grow in popularity, and companies that already have reputable brands and distribution are best positioned.

Grown Rogue Inc. (CSE: GRIN | OTC: NVSIF) represents a compelling investment opportunity in the cannabis edibles space. With a high-quality management team, proven track record, and significant distribution in Oregon (and now California and a recent announcement into Michigan), the company’s recent move into the cannabis edibles space could prove to be a game-changer. Investors may want to take a closer look at the stock given these trends and near-term plans to enter California.

For more information, visit the company’s website at www.grownrogue.com.

Disclaimer

The above article is sponsored content. Emerging Growth LLC, which owns CannabisFN.com and CFN Media, has been hired to create awareness. Please follow the link below to view our full disclosure outlining our compensation: https://www.cannabisfn.com/legal-disclaimer/

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.