CV Sciences looks beyond CBD
The US-based CBD Company, CV Sciences (OTC: CVSI), is looking beyond CBD and now wants to position itself as a leading health and wellness brand. Yesterday, the hemp company announced its entry into condition-specific dietary supplements and launched a new product CV™ Acute. This product is the first offering from its new immunity-focused product line.
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New immunity-boosting products for COVID-19 treatment
CV™ Acute is a proprietary plant-based formula to boost immunity and respiratory health. According to CV Sciences, the product is a “blend of Traditional Chinese Medicine (TCM) and proprietary modern analytical chemistry and extraction techniques”.
As the number of COVID-19 cases increases across the globe, the hemp stock has launched the right product at the right time. According to a preliminary study in March 2020, published in the International Journal of Biological Sciences, this formula has the capacity to prevent SARS-COV2. This the same virus that causes COVID-19.
CEO Joseph Dowling clarified, “We considered adding CBD to the formula, however, our goal is to make CV™ Acute broadly available to consumers through all retail channels at an affordable price so they can have easy access to the immune and respiratory health benefits this formula has demonstrated to provide.”
CV Sciences revenue under pressure in Q1
On the financial front, CV Sciences didn’t report impressive Q1 results. The company saw a 45% YoY (year-on-year) decline in its revenue at $8.3 million. The hemp stock had actually seen it coming amid the coronavirus crisis and lowered its revenue guidance in the previous quarter itself.
CV Sciences plans to save nearly $10 million through cost rationalization. However, due to the rise in online shopping, the hemp stock saw a growth in revenue through its e-commerce portal, +PlusCBD™ Oil. It’s worth noting that the hemp company has no debt and considerable cash balance at $7.6 million to help it survive these current times of great uncertainty.
Diversification strategy likely to yield positive results for CV Sciences
The cannabis segment is still in nascent stages and has many hurdles to surmount. The two of the most important being regulatory roadblocks and profitability. In the current climate of COVID-19 induced uncertainty, hemp stocks continue to face tremendous volatility.
As a result, companies like CV Sciences are now looking at diversifying their offerings. Recently, Neptune Wellness also diversified its product portfolio by foraying into hand sanitizer and Oximeter business.
Besides hedging risks, one of the important reasons for launching CV™ Acute, a non-CBD product is to gain access to sales channels and e-commerce stores. Currently, major e-commerce portals do not sell CBD-based products.
CV Science’s diversification into non-CBD products is good news for investors. It shows that the company is taking initiatives to boost its topline. CV Sciences is all set to report its second-quarter results on August 6 and investors are keen on seeing if there is a positive development on the revenue front. Keep your eyes peeled – there may be a play here.
CV Sciences looks beyond CBD
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