Is Selling Overdone in Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF)?

Is Selling Overdone in Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF)?

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Shares of Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF) have broken down in recent days as the public panic over the vaping disease intensifies. One point that should be included in the analysis is the fact that this company is not at all sharply tethered to vaping, with a wide range of products that have nothing to do with it. For example, the company just announced that The Vitamin Shoppe (NYSE: VSI), an omnichannel specialty retailer of nutritional products, has commenced selling the new line of Charlotte’s Web CBD hemp extract-infused CBD gummies in 738 stores across 45 U.S. states.

According to the release, this expands Charlotte’s Web product offerings carried by The Vitamin Shoppe to include CBD hemp extract oil tinctures, liquid capsules, and now gummies. Charlotte’s Web gummies are a popular edible format providing measurable consumption of convenient bite-sized full-spectrum CBD hemp extract.

Charlotte’s Web Holdings Inc (OTCMKTS:CWBHF) bills itself as a company that develops and distributes hemp-based cannabidiol (CBD) wellness products. Its products include CBD hemp oils, capsules, topicals, and pet products that feature CBD hemp oil extracts.

Charlotte’s Web Holdings, Inc. sells its products online as well as through distributors, and brick and mortar retailers.

The company was formerly known as Stanley Brothers Holdings Inc. and changed its name to Charlotte’s Web Holdings, Inc. in July 2018. The company was incorporated in 2018 and is headquartered in Boulder, Colorado.

According to company materials, “Charlotte’s Web Holdings, Inc. is the market leader in the production and distribution of innovative hemp-based cannabidiol (“CBD”) wellness products. Founded by the Stanley Brothers, the Company’s premium quality products start with proprietary hemp genetics that are responsibly manufactured into whole plant hemp extracts naturally containing a full spectrum of phytocannabinoids, including CBD, terpenes, flavonoids and other beneficial hemp compounds. Industrial hemp products are non-intoxicating. Charlotte’s Web current product categories include tinctures (liquid products), capsules, topical, as well as pet products. Charlotte’s Web hemp-based whole plant extracts are sold through select distributors, brick and mortar retailers, and online through the Company’s website.”

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As noted above, CWBHF just announced that The Vitamin Shoppe (NYSE: VSI), an omnichannel specialty retailer of nutritional products, has commenced selling the new line of Charlotte’s Web CBD hemp extract-infused CBD gummies in 738 stores across 45 U.S. states.

While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action CWBHF shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -17% on above-average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities.

“This nationwide pickup of our popular new gummy line by The Vitamin Shoppe is very exciting to report,” said Charlotte’s Web CEO Deanie Elsner. “Working with a trusted retail partner that is dedicated to helping its customers become their best self, allows us to effectively expand our national footprint giving more Americans retail access to our leading CBD hemp extract wellness products. We are thrilled about The Vitamin Shoppe’s decision to expand their offering with our new chewable gummies.”

Now commanding a market cap of $560.5M, CWBHF has a significant war chest ($67.2M) of cash on the books, which compares with about $18.3M in total current liabilities. CWBHF is pulling in trailing 12-month revenues of $113.8M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 50.6%. You can bet we will update this one again as new information comes into view. Sign-up for continuing coverage on shares of $CWBHF stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in $CWBHF, either long or short, and we have not been compensated for this article.

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