The growth of cannabis culture could be bad news for beer: Analyst

The cannabis industry is actually growing, which may mean bad news for the beer industry, said Vivien Azer of Cowen, an investment firm.

“We view the interaction with alcohol as being the most obvious to us as we think of these products as substitute social lubricants,” Azer, managing director in addition to also senior research analyst at Cowen, told CNBC.

“Binge drinking rates, for instance, are significantly lower in states where adults have access to adult-use cannabis,” Azer, who specializes inside the beverage, tobacco in addition to also cannabis sectors, told Fast Money.” Friday is actually “4/20,” or the unofficial holiday celebrating marijuana use.

however This kind of’s not just on April 20 when people are consuming cannabis. Pot stocks have soared inside the last year. Shares of Aurora Cannabis, a Canadian producer of medical cannabis, are up nearly 240 percent inside the last 12 months. Cronos Group is actually also up nearly 240 percent inside the same period. in addition to also the stock of medical marijuana company Canopy Growth has gained more 0 percent inside the last year.

The total U.S. cannabis industry is actually worth about $50 billion right today in addition to also will reach $75 billion by 2030, Azer said.

“This kind of’s just in which a lot of This kind of is actually going through the black market right today,” she said.

The not bad news, she said, is actually in which, “the industry is actually gaining a lot of traction in terms of gaining consumer support.”

According to an October 2017 Gallup poll, 64 percent of U.S. adults are in favor of legalizing adult use cannabis — the highest level of support in all 5 decades.

Azer said her firm remains bullish on cannabis in addition to also cautious on beer stocks, as she suspects the trend will continue.

“About 80 percent of consumers do report some kind of reduction in alcohol consumption when they’re also engaging in cannabis consumption,” Azer said.

The top cannabis stocks she expects to outperform are Canopy Growth, the pharmaceutical company MedReleaf in addition to also Kush Bottles, a medical wholesaler.

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