by Ian Harvey
January 16, 2019
New Age Beverages Corp (NASDAQ: NBEV)
New Age Beverages Corp spikes higher on a continuous basis in 2019 after soaring 140% in 2018. This is due to a line of drinks infused with cannabidiol, the “Farm Bill” having passed, merger with Morinda, and the expected analyst attention.
And “Cut-to-the-Chase Members”, taking a call option, realized 140% potential profit on the day; and more could be expected.
PATIENCE PAYS OFF!
YOU NEED TO BE IN TO PROFIT!
The Details Presented Previously……..
Beverage maker New Age Beverages Corp (NASDAQ: NBEV) were moving higher last month after the CBD (cannabidiol) beverage maker got a boost from a passage of the pot-friendly Farm Bill and as it made an acquisition to improve its distribution, especially in Asia. As a result, the stock finished December up 12%.
New Age shares exploded in September, when the company announced a move into CBD beverages, jumping on to the cannabis bandwagon and transforming its proposition to investors. The stock's rally began on Dec. 10, in anticipation of the passage of the Farm Bill, which legalized hemp, the source of CBD, on a federal level, effectively making CBD legal and allowing interstate commerce of the non-psychoactive pot derivative.
In response to Congress' passage of the bill, New Age issued a press release, saying it was poised to aggressively expand its portfolio of CBD beverages, and that it had commitments with several major retailers pending the passage of the Farm Bill and the legalization of hemp, as well as commitments that give it more than 125 million points of distribution. The stock rose 28% over the three sessions from Dec. 10 to Dec. 12, and President Trump signed the Farm Bill into law later in the month.
With the Farm Bill now law and its merger with Morinda giving it an expanded market, 2019 could see a lot of upside to New Age stock when CBD beverages take off. However, expect the volatility to continue.
Option trade to consider: Buy the NBEV MAR 15 2019 6.000 CALL at approximately $0.80.
The Result So Far………
New Age Beverages stock gained 140% last year; and in 2019, shares of the Denver-based maker of organic, natural, and healthy beverages have already tacked on 18.8% through January 11. The broader market has returned 3.6% over this period.
Several factors attributed to New Age Beverages stock increase…..
So, for “Cut-to-the-Chase Members”, who managed to execute this trade recommended by Stock Options Made Easy; potential profits of 140% were available yesterday.
Entering the option trade at a cost of $0.80 or less last Thursday; and the price of the option reaching $1.71 yesterday; a potential profit of 140% was made. Therefore, one options contract would provide a profit of $105.00.
A NICE START TO THE WEEK!
AS ALWAYS THE DECISION IS YOURS!
The global market for CBD-infused beverages has the potential to be
massive, so it's certainly a plus that New Age Beverages is an early mover in
Expanding on the attributing factors mentioned above; a couple of weeks before the Farm Bill was signed in Congress, New Age Beverages announced an $85 million deal to acquire Morinda, a much larger beverage company with $240 million in annual sales.
New Age Beverages and its now $450 million market cap was generating sales of just $49.4 million on its own over the past four quarters. In a single transaction, it's boosting its revenue nearly sixfold for a deal that is valued at less than a fifth of its market cap.
Morinda offers New Age Beverages a foot in the door internationally, as it has a presence in 60 countries, with a particularly strong position in Asia. New Age Beverages was seeing sales stall in 2018, but that will change in 2019 between the CBD beverages and Morinda expanding its global reach.
New Age Beverages is still off the radar of most investors and major analysts. One of the more recognized Wall Street pros covering New Age Beverages is Northland's Mike Grondahl. He's bullish on the investment, and earlier last week, he boosted his price target on the shares from $6 to $8.
And following this, New Age Beverages was upgraded by research analysts at BidaskClub from a “hold” rating to a “buy” rating in a report released on Saturday.Therefore, NEW Trades to consider……..pick one to suit your risk tolerance…..
** OPTION TRADE 1: Buy NBEV MAR 15 2019 7.000 CALL at approximately $1.10 to 1.20. Sell price is left to your own judgment.
** OPTION TRADE 2: Buy NBEV JUN 21 2019 7.000 CALL at approximately $1.50 to 1.70. Sell price is left to your own judgment.
An Important Note: That any suggestions for options trade considerations require investors/traders to use their own discretion as to when to enter or exit! As well, it is advisable to do further research and due diligence before executing your trade.
It is sometimes best to exit a trade, if there is already sufficient profit accrued, before an earnings report is presented. GREED can be the undoing of a nice profit!
Strategies to Consider……
When To Exit A Trade Based On Earnings?.....Read Article
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