Arcadia shares surged more than 60% after the firm announced its pot stock pivot.

Arcadia Biosciences Inc.’s share price surged 61 percent while trading on the Nasdaq Thursday after the agricultural biotech firm announced plans to dive into the hemp industry.

arcadia cannabis pot stock
Arcadia shares surged more than 60% after the firm announced its pot stock pivot.

The company’s core business area is producing food ingredients made from wheat and soybeans. The company is jumping into the cannabis space as “with an initial focus on the hemp market,” according to a news release published Thursday. “Now, the company will apply its expertise to the burgeoning cannabis industry,” the announcement stated.

Raj Ketkar, chief executive office at Arcadia Biosciences, said:

“We see enormous opportunity in – and demand for – improved plant quality, productivity, consistency, and resilience … With this new operating unit, Arcadia Specialty Genomics, we are uniquely qualified as a proven crop improvement company equipped to address the legacy challenges facing a plant that until recently was largely grown unlawfully.”

Hemp Legalization Boosts Pot Stocks

A legal change enabled the creation of the new business unit. The company cites the 2018 Farm Bill, also dubbed the Agricultural Improvement Act of 2018. US President Donald Trump signed the bill into law on December 20, 2018.

Through that bill, Congress and President Trump basically legalized hemp production on the federal level, even though cannabis remains a Class 1 drug in the country. (Other Schedule 1 drugs include heroin, MDMA/ecstasy, and peyote.)

The Farm Bill further legalized hemp’s cultivation, transportation, and commercial sales — stomping out a ban that extended back more than 75 years.

Arcadia Biosciences will keep its business operations confined to federal and state markets where the cannabis activities are legal.

Most of the percentage gain in the pot stock were recorded during pre-market trading. Arcadia’s stock was up 28 percent over the past three months leading up to Wednesday.


H.C. Wainwright analyst Ram Selvaraju, a fair price target for Arcadia is $20. The company has a one-year peak of $66.56 and a 52-week low of $2.65.

In the long-run, investment bank Cowen & Co. has said that the value of the legal weed market may reach $75 billion by the end of the 2020s. This year, KushCo Holdings (KSHB), Innovative Industrial Properties (IIPR), and Canopy Growth (CGC) are other top pot stocks poised for a strong year in 2019, investment analysts say.

Like with pumps in the crypto space, there is some risk that the top may blow off if Arcadia’s announcement does not pan out. But it’s encouraging to see private enterprises develop back-end agricultural products in the cannabis industry.

You May Also Like

Spend Your $1,000 Wisely on Cyber Monday. Consider These 4 Stocks

The average consumer will spend $1,000 this holiday season. Don’t be average, consider making your money work for you with these stocks.

Deutsche Bank Reveals the Real Reason Stock Market Is at All-Time Highs (& Why It Can’t Continue)

The US stock market is at all-time highs, but what’s driving this ten-year bull market? It’s stock buybacks, according to Deutsche Bank.

Dow Futures Rocket but Warren Buffett’s $128 Billion Skips Overpriced Market

Dow Jones Industrial Average (DJIA) futures point to new stock market highs, so why is Warren Buffett reluctant to invest?

US Steel (NYSE:X) Needs More Than Trump Tariffs to End 2019 in the Green

US Steel (NYSE:X) rose swiftly after President Donald Trump announced the reimposition of tariffs on imports from Brazil and Argentina.

Dow Pops While Trump Trade War Hits Unsettling Milestone

The Dow kicked off December with a recovery, but stock market bulls must wrestle with an unsettling trade war milestone.

5 Reasons Why the Dow Suffered a 200-Point Nosedive Today

The Dow Jones recoiled on Monday, relinquishing its gains and diving more than 200 points into decline. Here are five reasons why.