Amid the weakness in oil prices and uncertainty about the COVID-19 pandemic, the S&P 500 Index fell by 1.8% on Monday. However, Canopy Growth (NYSE:CGC)(TSE:WEED) stock rose to a high of 22.66 Canadian dollars before closing at 21.46 Canadian dollars. The stock rose by 1.5% from the previous day’s closing.
On Monday, Canopy Growth announced that it will strengthen its “First & Free” portfolio by introducing a new line of CBD creams in US markets. Investors’ optimism about the introduction of these new products led to a rise in the company’s stock price.
New CBD products from Canopy Growth
Canopy Growth launched the First & Free brand in the US in December 2019. The company sold oil drops and soft gel capsules under the brand, which were manufactured by hemp-derived CBD isolate products. On Monday, the company announced that it will add a new line of CBD Creams—Everyday, Motion and Revitalize. The company said that these three products were manufactured from CBD isolates. The CBD isolates were extracted from hemp grown in the US.
The company uses state-of-the-art technology to manufacture these creams. Canopy Growth has also adopted rigorous testing procedures to deliver consistent and high-performance products. The company said that these products are non-greasy and easy to use. Customers can use the products daily. Meanwhile, each 1.76 oz tube contains 2,500 mg of CBD. The company claimed that this would make “First & Free to be the highest strength hemp-derived CBD topical cream on the US market.”
Speaking about the new products, Canopy Growth CCO David Bigioni said, “With our new line of topical creams, First & Free is building a portfolio to treat the everyday stressors that affect both body and mind. We’re proud to offer the highest strength topical cream on the US market – up to five times the CBD of other topicals – at a great value.”
YTD Stock performance
Weakness in the cannabis sector continues to drag Canopy Growth stock down. YTD, the stock has fallen by 21.4%. However, Canopy Growth has outperformed cannabis ETFs and its peers this year. During the same period, the ETFMG Alternative Harvest ETF (NYSE:MJ) has declined by 32.5%. Meanwhile, Aurora Cannabis (NYSE:ACB) and HEXO (TSE:HEXO) have fallen by 63.4% and 66.7%, respectively.
I have been bullish on Canopy Growth for some time. Currently, many cannabis companies are struggling with weak cash positions and rising debt. However, Canopy Growth has 2.3 billion Canadian dollars of gross cash. Also, the company wants to strengthen its position in the US and Canada by introducing new products. So, I think that investors should look to accumulate the stock on dips.