The Marijuana Buyout Wars Have Begun

Written by Nick Hodge
Posted August 28, 2018 at 8:00PM

It’s happening.

After making a smaller previous investment, Constellation Brands (NYSE: STZ) announced this month a C$5 billion investment in Canopy Growth (TSX: WEED)(NYSE: CGC).

Constellation Brands is a Fortune 500 producer and marketer of iconic brands like Corona beer and Robert Mondavi wines.

The deal will make Constellation more than a 50% owner of Canopy if it exercises all the warrants.

It values Canopy at C$9.2 billion, now increasing its lead as the largest weed company in the world.

Shares of Canopy are up 93% since the deal was announced.

Canopy Growth ChartThe deal totally legitimizes the cannabis industry as a growing global powerhouse.

It’s a shot across the bow to other major brands: You better make your move now, or risk missing out.

And so it’s begun…

Molson Coors (NYSE: TAP)(TSX: TPX-B) has partnered up with Hydropothecary Corp. (TSX: HEXO) (OTC: HYYDF) to develop cannabis-infused drinks.

Hydropothecary shares are up 47% since the deal was announced this month.

Hydropothecary ChartBlood is now in the water as other big names are looking to join the frenzy.

CannTrust Holdings (CSE: TRST)(OTC: CNTTF) was mentioned this month by Echelon Wealth Partners as a possible target, noting it “should be a very attractive candidate for a strategic investment or acquisition offer from any of the alcohol/pharmaceutical/tobacco/consumer packaged goods industries."

It went up 75% on the mere mention.

CannTrust ChartOther names have been floated as well.

New suitors from the well-heeled beer, spirits, tobacco, pharmaceutical, and consumer staple industries will soon emerge.

Bloomberg reports Diageo (NYSE: DEO) — the company behind Johnnie Walker, Captain Morgan, Smirnoff, Guinness, and others — is “pursuing a deal.”

Coca-Cola (NYSE: KO) is rumored to be shopping.

The deal-making — and profits — have only begun.

Industry insiders, including our own Jimmy Mengel, are pointing to the medical side of cannabis as the next fertile ground for consolidation.

While beer and liquor companies want in on the psychoactive THC for drinks and other consumables, big pharmaceutical companies or sports drink companies will want in on the non-psychoactive CBD side of things.

Will Pfizer (NYSE: PFE) want an over-the-counter CBD pill to compete with its Advil brand?

Will PepsiCo (NASDAQ: PEP) want a CBD-infused Gatorade?

Jimmy has the inside track on which companies are poised for the biggest gains. 

He was the first newsletter writer to tour Canopy Growth's facilities, and delivered thousands of percent to his readers in the early days of this pot bull market.

Now big names are coming in and he sees a whole new wave of riches being made.

So much so that he’s guaranteeing you can make 1,000% if you follow his advice.

The time to get in is now.

Plus, Jimmy’s guarantee is only good through this Friday, August 31.

Call it like you see it,

Nick Hodge Signature

Nick Hodge

follow basic@nickchodge on Twitter

Nick is the founder and president of the Outsider Club, and the investment director of the thousands-strong stock advisories, Early Advantage and Wall Street's Underground Profits. He also heads Nick’s Notebook, a private placement and alert service that has raised tens of millions of dollars of investment capital for resource, energy, cannabis, and medical technology companies. Co-author of two best-selling investment books, including Energy Investing for Dummies, his insights have been shared on news programs and in magazines and newspapers around the world. For more on Nick, take a look at his editor's page.

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