Commoditization, HEXO's entire strategy around that This pot stock can win
Hexo (TSX:HEXO)(NYSE:HEXO) is prepared for commoditization. In fact, it built its entire strategy around that challenge.
Instead of growing as much marijuana as possible, this pot stock opted to build the industry’s first cannabis platform. Any outside company can plug into Hexo’s infrastructure to co-create THC products on-demand.
For example, Molson Coors and Hexo plan to launch a co-branded beverage product in 2020. Hexo lends the expertise and resources related to cannabis, while Molson contributes its brand-name recognition and marketing weight. This strategy should outperform the products of unknown marijuana startups.
In the years to come, Hexo plans on replicating this partnership across several other categories, including cosmetics, sleep aids, and edibles. This should prove a $10 billion market in North America alone. Despite its early-mover advantage, Hexo commands a market cap of just $500 million.
In 2019, when enthusiasm for pot stocks was at a fever pitch, Hexo stock was worth 10 times the current value. It will take time to regain that position through actual financial performance, but this decade, expect shares to retest their former highs.
https://ca.finance.yahoo.com/news/pot-stock-rise-10-times-233050762.html
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