Real Brands Inc (OTCMKTS:RLBD) snuck one under the radar late last week, but investors interested in the CBD and Cannabis space should take note.
The company filed its Form 10 with the SEC. In this case, it was a voluntary filing because the company does report having over $10 million on total assets of its last known quarterly report.
Nonetheless, we can infer that this step means RLBD is going to become a fully-reporting entity with the SEC, which will include greater transparency and the necessity of filing 8k’s on any material events.
This step will also put the company in position to uplist to the OTCQB tier provided it has satisfied other requirements.
It also makes it far easier to lure in institutional investment capital and to finance far more significant expansion steps.
Why Did RLBD File Form 10?
Real Brands Inc (OTCMKTS:RLBD) already has a number of big catalysts in play.
According to a recent interview (which can be found here), the company is in late-stage negotiations with a major celebrity influencer who will help to spread its brands far and wide and generate massive consumer interest.
The company is also working on expanding its product lines and has the proprietary technology to produce higher margin cannabinoid-based products at scale efficiently, which grants RLBD another edge over the competition. RLBD is also working on an international expansion that will include marketing through international sports celebrities and sports leagues and include a sports wellness product line that is reportedly nearing launch.
RLBD is also working on a line of CBD Beverages and other fresh concepts and has noted that it is seeking an OTC uplist.
In other words, this filing is likely part of a process of uplisting and financing a major expansion in products and exposure on the CBD world stage.
Why is this a Good Idea?
We are particularly interested in this stock at this juncture because we think there’s reason to believe the CBD market could come roaring back to prominence in the near future.
Companies like Neptune Wellness Solutions Inc (NASDAQ:NEPT), cbdMD Inc (NYSEAMERICAN:YCBD), GW Pharmaceuticals PLC- ADR (NASDAQ:GWPH), Jazz Pharmaceuticals PLC (NASDAQ:JAZZ), Medical Marijuana Inc (OTCMKTS:MJNA), and CV Sciences Inc (OTCMKTS:CVSI) are all part of this story as well. But all of them are much more heavily discounted into the story than is RLBD, which hasn’t yet been found by the crowd.
RLBD shares have likely not priced in any part of a CBD recovery and expansion, despite the fact that the company is almost a quarter owned by Turning Point Brands, Inc. (NYSE:TPB), which is a third owned by a multi-billion dollar hedge fund with a vested interest in helping TPB, and its major interests and partners, secure necessary financing on strong investor-friendly terms. TPB trades on a major exchange already.
TPB also has big exposure on the distribution side to the convenience store marketplace, which is something the other major CBD players likely lack, giving RLBD an edge down the line as the marketplace expands into that huge end-market point of sale due to RLBD’s relationship with TPB as a major supplier and investment holding.
Finally, the long-term picture for the CBD market is still just as promising as ever. Stocks in the space got way ahead of themselves a few years ago. The resulting fallout was something like a miniature version of what happened to tech stocks in 2001-02. But that carnage has resulted in a life-changing investment path for the folks that bought the Nasdaq players near the lows. The internet was still one of the most important bullish themes ever to arise. Similarly, CBD is still a niche market destined to go mainstream in a manner that cannabis likely never will. And RLBD is set to assume its position as one of the most prominent names in that story.
Now that it has filed Form 10, it is one step closer to making that happen.