قالب وردپرس درنا توس
Home / Business / Why US legal weed sales could triple over the next 5 years

Why US legal weed sales could triple over the next 5 years



<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Leaders in the cannabis space Aurora ( ACB ) and Canopy Growth ( CGC ) both reported disappointing quarterly earnings this week, but Roy Bingham, CEO and founder of cannabis data company BDS Analytics, tells Yahoo Finance & nbsp; YFi PM that he is still projecting the US cannabis market to reach $ 30 billion over the next five years. & Nbsp; "data-reactid =" 1
5 "> Leaders in the cannabis space Aurora (ACB) and Canopy Growth (CGC) ) both reported disappointing quarterly revenue this week. But Roy Bingham, CEO and founder of cannabis data company BDS Analytics, tells Yahoo Finance YFi PM that he is still projecting the US cannabis market to reach $ 30 billion over the next five years.

"You hear these huge numbers like a $ 150 billion or $ 200 billion market," says Bingham. “It's the total potential market. Our projection is more like a $ 30 billion market based on the actual assessment of how long it will take to roll out the stores and get the regulation approved. "

<p class =" canvas atomic canvas text Mb (1.0em) Mb (0) – sm Mt (0.8 em) – sm "type =" text "content =" Total sales of legalized marijuana reached worth $ 10.4 billion in the US in 2018, according to & nbsp; New Frontier Data . "Data-reactid =" 17 "> Total sales of legalized marijuana reached $ 10.4 billion in the US in 2018, according to New Frontier Data.

<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8 em) – sm" type = "text" content = "Aurora missed & nbsp; quarterly revenue & nbsp; top and bottom line estimates Thursday posted an adjusted EBITDA loss of $ 39.7 million – wider than $ 20.8 million expected by analysts. It also announced that it is suspending production plans at its plants in Canada and Denmark to increase the balance. "data-reactid =" 18 "> Aurora missed quarterly and top-line revenue estimates Thursday, delivering an adjusted EBITDA loss of $ 39.7 million – wider than $ 20.8 million as expected by analysts. Also, it stops production plans at its plants in Canada and Denmark to increase balance.

Aurora boss Cam Battley said in the earnings call that management issues and consumer demand development were challenges for the sector.

<p class = " canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" This came as competitive Canopy Growth also reported weaker than expected & nbsp; Revenue . "data-reactid =" 20 "> This came when competing Canopy Growth also reported lower-than-expected earnings.

<p class =" canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt ( 0.8 cm) – sm "type =" text "content =" "The last two quarters have been challenging for the Canadian cannabis sector as provinces have reduced purchases to lower inventory levels, store openings have fallen below expectations, and Cannabis 2.0 products have not yet come to market, "said Mark Zekulin, CEO, Canopy Growth after Missing, & nbsp; according to MarketWatch . "Data-reactid =" 21 ">“ The last two quarters have been challenging for the Canadian cannabis sector since provinces have reduced purchases to lower inventory levels, store openings have fallen below expectations, and Cannabis 2.0 "The products are not yet on the market," said Mark Zekulin, CEO, Canopy Growth after the missing, according to MarketWatch.

A worker collects cuttings from a marijuana plant at the Cano plant py Growth Corporation of Smiths Falls, Ontario, Canada, January 4, 2,018. Image taken January 4, 2018. To Match Insight CANADA-MARIJUANA / INNOVATION REUTERS / Chris Wattie

<p class = " canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" The Alternative Harvest ETF (MJ) is more than 30% this year, but Bingham says basic consumer product adoption will be the biggest factor in turning things around for the cannabis sector – especially in the US "data-reactid =" 33 "> The Alternative Harvest ETF (MJ) is down more than 30% this year, but Bingham says the basic use of consumer products will be the biggest factor to turn things around for the cannabis sector – especially in the United States

"In the US, we see market growth in the mature states of around 21% in year, and then you add the new states to use for adults in January next year, like Michigan and Illinois, and you can see tremendous growth, ”Explains Bingham. "Let's face it, when it comes to the overall growth rate, you can't have a 100% compound growth rate year after year."

But some in the industry fear Canadian companies may get past the US market if cannabis is federally legalized, speculating that more established Canadian players could expand their supply chains faster than smaller US-based brands.

"Several people say & # 39; the current environment is attractive to me to make the business significant and profitable, & # 39;" explains Bingham. "However, it is difficult to expand from one state to several states under You have to set up a very different organizational structure in each state. There are large American companies emerging in California and Colorado, but they are not yet able to reach the same kind of scale when it comes to capital as Canadians. "

So what can differentiate winners from losers in space? Bingham speculates consumer confidence in an established brand will be what determines the success of a company.

" There is no doubt that consumers are eventually attracted to brands, " says Bingham. "They expect an experience to be consistent and predictable. Once they find a brand they like, they will stick to it. So we're in this phase where it's not so much about distribution and getting on the shelves, but actually starting to resonate with a consumer. ”

<p class =" canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Meghan Fitzgerald is a producer at Yahoo Finance. "data-reactid =" 39 "> [19659014] Meghan Fitzgerald is a manufacturer at Yahoo Finance.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Read the latest Yahoo Finance economic and business news "data-reactid =" 40 "> Read the latest Yahoo Finance economic and business news

<p class =" canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Follow Yahoo Finance on Twitter [19659019] Facebook Instagram Flipboard LinkedIn [19659019] and reddit . "data-reactid =" 41 "> Follow Yahoo Finance on Twitter [19659035] Facebook Instagram Flipboard LinkedIn and [19659033] reddit .


Source link