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Why Canopy Growth Partner Neptune Wellness’ Stock Soared 71% in the First Half of 2019

What happened

Shares of Canadian extraction specialist Neptune Wellness Solutions (NASDAQ:NEPT) gained 71.3% in the first half of 2019 (January through June), according to data from S&P Global Market Intelligence.

This performance takes a cue from the Roman god for which the company is named as it rises from the sea of top names in the marijuana space. Shares of the three largest cannabis grower stocks by market cap — Canopy Growth (NYSE:CGC), Aurora Cannabis, and Cronos Group — rose 50%, 57.7%, and 53.8%, respectively, in the first six months of the year. For additional context, the S&P 500 returned 18.5% over this period.

Neptune, which has traditionally focused on nutraceuticals, leveraged its experience in extraction, purification, and formulation of value-added products to enter the cannabis market.

So what

As background: Neptune Wellness stock has been in a general uptrend since the company threw its hat into the cannabis ring in 2017. Investor enthusiasm was stoked in June 2018 when Neptune announced that it had entered a multiyear agreement to provide Canopy with extraction and purification services. This was a big coup given Canopy’s size and industry-leading cash position thanks to its partnership with alcoholic beverage giant Constellation Brands.

Turning to major milestones in 2019, each of which propelled Neptune’s stock upward, as the chart below shows):

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