Canopy Growth stock jumps on NY license approval

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The Canadian company has been given a license to produce and process hemp

Regulators in New York have granted Canopy Growth a license to produce and process hemp in the state following the successful passage of the 2018 Farm Bill. As a result, the company’s shares, which are traded on NASDAQ, have enjoyed a nice rally. The passage of the Farm Bill already helped the company’s stock spike, but the new license has seen it increase more than 11% in less than a day and over 13% in recent weeks.

With the license in place, Canopy is set to break ground on a new $150-million production facility in the state. According to a company announcement, “Thanks to the work of key state and federal government officials from the State of New York, Canopy Growth is proud to outline its commitment to invest in New York in order to establish a Hemp Industrial Park.”

The facility is expected to focus on the extraction and production of hemp and will “create jobs in an exciting highly profitable new industry,” according to the statement.

The Farm Bill is helping to create an entirely new market. The Brightfield Group expects that cannabidiol (CBD) and CBD-based products will result in a $20-billion industry within the next three years. Investors seem to be particularly drawn to cannabis stocks already this year, intently following the new sector. Across the board, marijuana stocks have been performing better. In addition to Canopy’s increase, Aurora has seen its price jump 6% and Tilray has enjoyed a 4% spike.

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