The election results are actually bullish for marijuana stocks.
Cannabis stock investors didn’t get the blue wave these were hoping for in the U.S. election, but all 5 status marijuana legalization measures on the ballot have passed. Recreational and/or medical marijuana was legalized in Arizona, Mississippi, Montana, new Jersey and South Dakota, increasing the possible geographic footprint of cannabis multistate operators, or perhaps MSOs. Unfortunately for cannabis investors, Democrats might not gain control of the Senate, potentially restricting significant federal cannabis reform. To be a result, some cannabis stocks initially dropped following the election. Allow me to share the very best cannabis stocks to invest in following the election, as reported by Cantor Fitzgerald.
Flower price depreciation continues to be a significant issue for almost all Canadian licensed producers, or LPs. But, analyst Pablo Zuanic states Canadian LPs like Aphria could have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes more than the White House. Federal legalization may well still be a minimum of 2 years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis can raise Aphria as well as other Canadian LPs, Zuanic says. He claims Aphria has a number of positive catalysts in front in the near term, including a rise in exports. Cantor Fitzgerald has an “overweight” rating and $8.95 price target for APHA stock.
Canadian LP OrganiGram has had a brutal year in 2020. Zuanic affirms OrganiGram’s retail sales trends in the third quarter were relatively strong compared with various other Canadian LPs. Nonetheless, Hifyre cannabis sales information for October suggest OrganiGram sales had been down 25 % month over month in contrast to a 5 % decline for the complete Canadian retail store. OrganiGram has disappointed investors with the sluggish revenue growth of its and money burn up, but Zuanic is actually optimistic the company may find its way to growth and earnings in the long term. Cantor Fitzgerald has an “overweight” rating and $4.07 cost target for OGI inventory.
While Canadian cannabis stocks are actually struggling, U.S. multistate operators like Cresco Labs are actually thriving. In the next quarter, Cresco beat consensus analyst sales estimates by thirty % and exceeded the earnings of theirs before interest, taxes, depreciation and amortization expectations by nearly 200 %. Zuanic says Cresco’s 42 % sequential sales growth in the next quarter was the very best growth rate with almost all of Cresco’s big MSO peers. Zuanic alleges the Illinois industry will be a leading near-term growth driver for Cresco, and the Origin House acquisition of its should supplement its organic growth. Cantor Fitzgerald has an “overweight” rating and $16 cost target for CRLBF stock.
Curaleaf is a U.S. MSO which runs in twenty three states. One of those states is actually New Jersey, which may represent the largest opportunity among the states which legalized recreational marijuana on Election Day. Not merely will Curaleaf benefit from the brand new Jersey sector, but Zuanic says Curaleaf will probably draw clients from neighboring New York and Pennsylvania. Curaleaf noted astounding 142 % revenue growth as well as 180 % disgusting earnings growth year over year in the second quarter and also holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and $18 cost target for CURLF stock.
Green Thumb Industries (GTBIF)
Green Thumb Industries is actually a U.S. MSO which runs in twelve states, including California and Florida. Zuanic says Green Thumb has the very best risk profile of Cantor’s top rated MSOs. Green Thumb has expanded its footprint in Illinois and Pennsylvania without overextending its balance sheet, it already has a sizable presence in New Zuanic and Jersey is projecting revenue will develop from $527 million in 2020 to $982 million by 2022. Additionally, he anticipates additional legalization of Pennsylvania, New York, Connecticut as well as Maryland in coming years. Cantor Fitzgerald has an “overweight” rating and $29 price target for GTBIF inventory.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is actually an MSO which operates primarily in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After speaking with Rivers, Zuanic says he’s comfortable in Trulieve’s ability to keep a dominant market share of the high-growth Florida medical marijuana industry. Furthermore, Zuanic affirms Trulieve includes a substantial opportunity to produce the businesses of its in other states, including California, Massachusetts and Connecticut. Last but not least, he is upbeat Florida voters can legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and $60 price target for TCNNF inventory.
GW Pharmaceuticals (GWPH)
In contrast to the other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical company centered on developing cannabis based drug therapies. The company’s lead drug Epidiolex has been approved by the Food as well as Drug Administration for the treatment of pediatric epilepsy. Cantor analyst Charles Duncan says GW’s third quarter Epidiolex sales exceeded the expectations of his. He also sees assorted bullish catalysts for GW with the tail end of 2021, including further penetration into adult patients and additional rollout in Europe. Cantor has an “overweight” rating and $165 price target for GWPH inventory.