Canopy Growth (TSX:WEED)(NYSE:CGC) sells medical products and operates in two reportable segments. The company’s global cannabis segment encompasses the production, distribution, and sale of a diverse range of cannabis and cannabinoid-based consumer products in Canada and internationally.
Lucrative and high-margin division
The company’s consumer products segments is a lucrative and high-margin division for the company. This division is comprised of the production, distribution, and sale of consumer products by Storz & Bickel, This Works, and BioSteel, and other revenue sources.
Blending with hemp-derived cannabidiol
In addition, other product offerings which are sold by Canopy Growth’s subsidiaries in jurisdictions where it is permissible to do so, include Storz & Bickel vaporizers and This Works beauty, skincare, wellness, and sleep products. Some of these products have been blended with hemp-derived cannabidiol (CBD) isolate.
Wide variety of product offerings
Further, Canopy Growth also sells BioSteel sports nutrition beverages, mixes, protein, gum, and mints, some of which have been infused with hemp-derived CBD isolate. The company’s products contain tetrahydrocannabinol (THC), CBD, or a combination of these two cannabinoids, which are found in the cannabis sativa plant species.
Marijuana-based products that could appeal to the masses
THC is the primary psychoactive or intoxicating cannabinoid found in cannabis. Canopy Growth also uses hemp in the company’s products, which is a term used to classify varieties of the cannabis sativa plant that contain CBD and 0.3% or less THC content by dry weight. Also, Canopy Growth sells marijuana-based products, which refers to varieties of the cannabis sativa plant with more than 0.3% THC content and moderate levels of CBD.
Well-maintained and licensed operational capacity
In addition, Canopy Growth’s licensed operational capacity in Canada includes indoor and greenhouse cultivation space, post-harvest processing and cannabinoid extraction capability, advanced manufacturing capability for vape products, soft-gel encapsulation and pre-rolled joints, a beverage production facility, and confectionary manufacturing.
Significant capabilities that allow Canopy Growth to supply the recreational and medical markets
These capabilities allow Canopy Growth to supply the recreational and medical markets with a complementary balance of flower products and extracted cannabinoid input for the company’s oil, CBD, ingestible cannabis, cannabis extracts, and cannabis topical products.
Implementing various measures to reduce the spread of the virus
Management has continued to closely monitor the impact of the COVID-19 global pandemic, with a focus on the health and safety of Canopy Growth’s employees, business continuity and supporting the company’s communities. Canopy Growth established a COVID-19 management committee shortly after the declaration of COVID-19 as a global pandemic and implemented various measures to reduce the spread of the virus.
Experienced minimal disruption to the production and supply chain
Furthermore, Canopy Growth has continued to operate under preventative measures and has experienced minimal disruption to the company’s production and supply chain. All 34 of Canopy Growth’s corporate-owned retail stores are open and offering click-and-collect and in-store shopping.
Resilient business model
Overall, Canopy Growth’s resilience has been admirable. The company’s business model is strong, and it could continue to deliver high-growth for the foreseeable future, which should benefit retail investors.