Lookout old guard food and drug companies, the surging cannabis industry is coming for your consumers.
"This industry [cannabis] is disrupting the pharmaceutical industry, cannabis is a threat to prescription based painkillers primarily opiods," explained Tilray (TLRY) CEO Brendan Kennedy in an interview with TheStreet. "It's definitely a threat to companies in the alcohol industry who see cannabis as a substitute -- it's also a threat to some of the functional food and beverage companies who don't look at THC as an ingredient but look at CBS as an ingredient in CBD water or CBD exercise or recovery drink."
Kennedy says people would be "surprised" by how many large companies, starved for growth in many cases, have looked at getting into the cannabis space. Wine and spirit giant Constellation Brands (STZ) was among the first to sniff out the opportunity in cannabis, spending $191 million in 2017 for a 9.9% stake in Canopy Growth.
Judging by the market's response to Tilray's IPO on Thursday, investors are betting a member of the old guard reaches out to the company very soon.
Shares of Tilray saw a scorching hot 31% gain on its first day of trading on the Nasdaq Composite undefined . Tilray's market cap is now hovering around $2 billion. The company gains the distinction of being the first U.S. cannabis IPO, impressive given the mountain of regulatory hurdles.
Be sure to receive Real Money's 'WeedStreet' weekly column, it keeps investors current on how to play the red-hot cannabis space and check out the RM Cannabis Podcast: Bath Bombs and Muscle Creams: How Beauty is Becoming the Fast Lane for Cannabis Growth.