The nascent cannabis sector continues to attract the attention of the public and investors even months after the first phase of substance legalization in Canada. The headlines on both sides of the North American border focused on heartbreaking price gains from weed vendors and multi-billion dollar deals with large business players in various industries who were ready to be disturbed by pot.
But for all the noise and anger, there are still many questions. The most prominent: how will this all play?
Real Test for Cannabis Companies
It is certainly a valid question, because in addition to the leisure market there are many facets for this productive sector, including various other segments. How large will the medicinal and pharmaceutical applications be? Will the edible retail market be the next big one? Or will cannabis revolutionize the beer and beverage industry?
Despite the unknowns, the intrigues are fed by estimates of the size of the markets, which all fall into the billions.
In Canada, the answers to some questions are starting to come to the fore as the date on which many of these products will soon be legalized later this year. While the world is closely monitoring this next phase, many observers speculate that it will be the true test for cannabis companies
NextLeaf solutions: different kind of cannabis sector player
While the major players in this space and their American business partners, such as Constellation Brands (NYSE :), Altria Group (NYSE 🙂 and Coca-Cola Company (NYSE :), in the beverage, tobacco and cosmetic fields concentrating on the & # 39; what & # 39 ;, while drawing up plans for the type of products they are going to produce, a small Canadian company has become interested in focusing on the & # 39; how & # 39; that they will be produced.
By eliminating this, Nextleaf Solutions (OTC :), (SNX :), a small-cap company based in British Columbia that manufactures cannabis extraction and processing equipment, is striving to become a world leader.
NextLeaf 300 Minute Chart
The Vancouver-based company is a different kind of player in the cannabis sector. It does not cultivate the plant. Rather, it is a technology company that has developed patented processes to extract cannabinoid oil from the plant. The process creates a distillate that NextLeaf & # 39; the precursor of any cannabis infused product & # 39; calls. According to NextLeaf CEO, Peter Pedersen, in an interview earlier this year:
"Intellectual property will become a major differentiator and value creator in this industry, comparable to bio-tech and life sciences."
The company, which trades in Canada under the appropriately chosen ticker OILS, was the recipient of the first patent in that country for the purification of cannabinoid oil. It also has three US patents for a process that creates a highly concentrated odorless and tasteless concentrated THC or CBD distillate that can be standardized for potency.
NextLeaf plans to commercialize the process by providing services to recognized growers under their own private brands. It also supplies the oil, which is scarce, to licensed distributors.
"In the last two years since its inception, we have been an R&D-focused company and we have quietly evolved (intellectual property). We have been able to defeat every billion-dollar market capitalization cannabis company to patent pedersen, "explains Pedersen. "And 2019 is all about commercializing that IP."
Trading since March, the shares of the company have increased by 51 percent in the last month, from CAD 43 cents a share to CAD 65 cents. Shares on the OTC market of the United States are priced comparatively and have had a similar trajectory
Although it is a small player against the bigger names in the cannabis space, NextLeaf is different from everyone else. It is primarily a technology company that wants to claim its own unique position in the industry. Analysts with Ubika Alpha earlier this month started coverage of NextLeaf, with a buy rating and a 12-month target of $ 1.65 per share.
In a video conference last week, Pedersen explained that the company did not have to worry about establishing a crop and increasing it, but that it could concentrate on perfecting its process
Here are some additional facts to consider: According to research and markets, the global cannabinoid hemp market is expected to grow from US $ 176.15 million in 2017 to US $ 1.182 billion by the end of 2024. Regarding food and pharmaceutical space, Pedersen points out that the ability to standardize the potential and formulations offers benefits for the development of commercial products.
