The election results are actually bullish for marijuana stocks.
Cannabis stock investors didn’t get the blue wave they were hoping for in the U.S. election, but just 5 status marijuana legalization methods on the ballot have passed. Recreational and/or medical marijuana was legalized in Arizona, Mississippi, Montana, South Dakota and new Jersey, increasing the potential geographic footprint of cannabis multistate operators, or perhaps MSOs. Unfortunately for cannabis investors, Democrats might not gain control of the Senate, possibly restricting significant federal cannabis reform. To be a result, a few cannabis stocks initially dropped following the election. Allow me to share the very best cannabis stocks to invest in following the election, according to Cantor Fitzgerald.
Flower priced depreciation has long been a major concern for almost all Canadian licensed producers, or maybe LPs. However, analyst Pablo Zuanic claims Canadian LPs as Aphria may have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes over the White House. Federal legalization might still be no less than two years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis may increase Aphria as well as other Canadian LPs, Zuanic states. He claims Aphria has multiple positive catalysts in front in the near term, including a surge of exports. Cantor Fitzgerald has an “overweight” rating and $8.95 cost target for APHA inventory.
Canadian LP OrganiGram has had a brutal year in 2020. Zuanic tells you OrganiGram’s retail sales trends in the third quarter had been fairly strong in comparison with other Canadian LPs. Nevertheless, Hifyre cannabis sales data for October suggest OrganiGram sales had been down 25 % month over month compared with a five % decline for the entire Canadian retail store. OrganiGram has disappointed investors with its sluggish revenue growth as well as cash burn, but Zuanic is actually optimistic the business may find the way of its to growth and profitability in the long run. Cantor Fitzgerald has an “overweight” rating and $4.07 price target for OGI inventory.
While Canadian cannabis stocks are actually struggling, U.S. multistate operators like Cresco Labs are thriving. In the next quarter, Cresco beat consensus analyst sales estimates by thirty % and exceeded their earnings before amortization expectations, depreciation, taxes, and interest by about 200 %. Zuanic affirms Cresco’s 42 % sequential sales progress in the second quarter was the very best growth rates among all of Cresco’s big MSO peers. Zuanic states the Illinois industry will be a leading near-term growth driver for Cresco, and the Origin House acquisition of its ought to supplement the natural growth of its. Cantor Fitzgerald has an “overweight” rating and $16 price target for CRLBF inventory.
Curaleaf is actually a U.S. MSO which operates in twenty three states. One of those states is New Jersey, which might represent the largest opportunity with the states that legalized recreational marijuana on Election Day. Not simply will Curaleaf benefit from the brand new Jersey sector, but Zuanic says Curaleaf may draw customers from neighboring Pennsylvania and New York. Curaleaf noted amazing 142 % revenue growth as well as 180 % gross profit growth year over year in the second quarter and holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and $18 cost target for CURLF inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO which runs in 12 states, including Florida and California. Zuanic states Green Thumb has the best risk profile of Cantor’s top-rated MSOs. Green Thumb has expanded its footprint in Illinois and Pennsylvania without overextending the balance sheet of its, it already has a sizable presence in New Jersey and Zuanic is projecting revenue will develop from $527 million in 2020 to $982 million by 2022. He also anticipates additional legalization of Pennsylvania, New York, Connecticut as well as Maryland in coming years. Cantor Fitzgerald has an “overweight” rating and $29 cost target for GTBIF inventory.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is an MSO which operates primarily in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After speaking with Rivers, Zuanic says he is comfortable in Trulieve’s ability to maintain a dominant market share of the high-growth Florida medical marijuana industry. In addition, Zuanic says Trulieve includes a significant opportunity to grow the businesses of its in other states, like California, Massachusetts and Connecticut. Lastly, he’s upbeat Florida voters can legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and $60 cost target for TCNNF inventory.
GW Pharmaceuticals (GWPH)
As opposed to the other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical business centered on creating cannabis-based drug therapies. The company’s lead drug Epidiolex has been approved by the Food as well as Drug Administration for the therapy of pediatric epilepsy. Cantor analyst Charles Duncan says GW’s third quarter Epidiolex sales exceeded the expectations of his. He also sees several bullish catalysts for GW through the conclusion of 2021, which includes further penetration into more rollout and adult patients in Europe. Cantor has an “overweight” rating and $165 cost target for GWPH stock.