evNew Age Beverages Corp (NASDAQ: NBEV) is having another great start to the trading session this morning. If you look for press releases, you’re not going to find anything new that was released today, but there is a good reason for the gains. It all has to do with the DEA. Today, we’ll talk about:
- Why NBEV is headed up;
- what we’re seeing from the stock; and
- what we’ll be watching for ahead.
Why NBEV Is Headed Up
As mentioned above, New Age Beverages is having a strong start to the trading session this morning on what seems to be no news. Nonetheless, I assure you, there’s a good reason for the gains. It all started a few sessions ago when NBEV announced that it would be launching a new line of CBD-infused beverages. These beverages, mixed with a recent announcement from the United States Drug Enforcement Administration (DEA), are the reason for the gains seen today.
CBD, also known as cannabidiol is a controlled substance in the United States as it is derived from the cannabis plant. However, the DEA recently announced that it has reduced the schedule of CBD to Schedule V. This means that the chemical has the lowest probability of abuse.
Ultimately, as a result of the DEA news, doors are swinging wide open for NBEV. Previously, the company’s CBD drinks would be available dependent on state laws. However, with the DEA making this announcmeent, CBD is likely going to be available nationally on a federally legal basis. That’s big news for a company that announced that it is entering this emerging industry as it greatly expands the company’s target audience for these drinks.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. In the case of NBEV, the news proved to be overwhelmingly positive. Not only did the company recently announce the launch of CBD-infused drinks in a time when investors seem to be hungry for cannabis stocks, the DEA just weighed in with great news for the company, expanding its audience. So, it comes as no surprise that excited investors are sending the stock screaming for the top. As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:47), NBEV is trading at $4.36 per share after a gain of $0.27 per share or 6.60% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on NBEV. In particular, we’re interested in following the story surrounding the company’s continued work to bring CBD-infused drinks to market. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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