One of the biggest contrarian plays right now is in vaping. Cannabis company KushCo Holdings (OTC: KSHB) has seen its share price take a beating this year as a result of its exposure to the vaping market. There's a lot of potential for the stock to recover if those concerns disappear, but it's by no means a sure thing. That's why investors need to do a careful analysis of the stock before making an investment decision.
The biggest reason investors are likely hesitant to invest in KushCo today is the company's exposure to vaping. Revenue from vape products made up more than two-thirds (67.4%) of the company's sales in Q4. Vaping-related illnesses are still in the news, and as long as the issue isn't going away, it could have a significant impact on KushCo's financials. As of Dec. 5, 48 people have died as a result of vaping and nearly 2,300 people have been hospitalized. The issue is widespread, with people in every state becoming ill after vaping. And it hasn't been just a U.S. problem, either, there have been similar cases in Canada and the U.K. The good news is that there has been progress, as health officials identified vitamin E acetate as the likely culprit behind the illnesses.
Until the issue is put to rest once and for all, it could spell bad news for the financials and outlook of a company like KushCo, since vaping is a big part of its business.
Source Fool.com