The election results are 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 state 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, possibly restricting significant federal cannabis reform. Being a result, some cannabis stocks initially dropped following the election. Here are the very best cannabis stocks to purchase following the election, based on Cantor Fitzgerald.
Flower price depreciation continues to be a major problem for all Canadian licensed producers, or perhaps LPs. Nevertheless, analyst Pablo Zuanic says Canadian LPs as Aphria might 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 two years away, but decriminalization of adult use marijuana and potential federal rescheduling of cannabis could raise Aphria along with other Canadian LPs, Zuanic says. He claims Aphria has a number of 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 of 2020. Zuanic tells you OrganiGram’s retail sales trends in the third quarter were fairly strong in comparison with other Canadian LPs. However, Hifyre cannabis sales data for October suggest OrganiGram sales were down twenty five % month over month in contrast to a five % decline for the complete Canadian retail market. OrganiGram has disappointed investors with the sluggish revenue growth of its as well as cash burn, but Zuanic is optimistic the small business will find its way to profits and growth in the long term. Cantor Fitzgerald has an “overweight” rating and $4.07 price target for OGI stock.
While Canadian cannabis stocks are struggling, U.S. multistate operators like Cresco Labs are thriving. In the second quarter, Cresco beat consensus analyst sales estimates by thirty % and exceeded their earnings before amortization expectations, depreciation, taxes, and interest by almost 200 %. Zuanic says Cresco’s 42 % sequential sales progress in the next quarter was the best growth rates among almost all of Cresco’s big MSO peers. Zuanic says the Illinois market will be a serious near-term growth driver for Cresco, and the Origin House acquisition of its should supplement its natural growth. Cantor Fitzgerald has an “overweight” rating and sixteen dolars price target for CRLBF inventory.
Curaleaf is actually a U.S. MSO that works in 23 states. One of those states is actually New Jersey, which may represent probably the largest opportunity with the states which legalized recreational marijuana on Election Day. Not merely will Curaleaf gain from the new Jersey sector, but Zuanic says Curaleaf will probably draw clients from neighboring Pennsylvania and New York. Curaleaf noted astounding 142 % revenue growth as well as 180 % disgusting earnings development year over year in the second quarter and also holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and $18 price target for CURLF inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO which runs in 12 states, like California as well as Florida. Zuanic states Green Thumb has the very best risk profile of Cantor’s top rated MSOs. Green Thumb has expanded the footprint of its in Illinois and Pennsylvania without overextending the balance sheet of its, it currently has a sizable presence in New Jersey and Zuanic is actually projecting revenue will mature from $527 million in 2020 to $982 million by 2022. Also, he anticipates additional legalization in Pennsylvania, New York, Maryland as well as Connecticut in coming years. Cantor Fitzgerald has an “overweight” rating and twenty nine dolars cost target for GTBIF inventory.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is an MSO that works largely in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After speaking with Rivers, Zuanic says he is comfortable in Trulieve’s potential to maintain a dominant market share of the high growth Florida medical marijuana industry. Additionally, Zuanic says Trulieve features a substantial chance to grow its businesses in other states, including Connecticut, Massachusetts, and California. Lastly, he is upbeat Florida voters might legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and sixty dolars price target for TCNNF stock.
GW Pharmaceuticals (GWPH)
As opposed to the various other cannabis stocks on this list, GW Pharmaceuticals is a biopharmaceutical business centered on developing cannabis based drug treatments. The company’s lead drug Epidiolex has been approved by the Food and Drug Administration for the treatment of pediatric epilepsy. Cantor analyst Charles Duncan says GW’s third-quarter Epidiolex sales exceeded the expectations of his. Also, he sees several bullish catalysts for GW with the tail end of 2021, which includes further penetration into additional rollout and adult clients in Europe. Cantor has an “overweight” rating and $165 price target for GWPH inventory.
