The election results are bullish for marijuana stocks.
Cannabis stock investors didn’t get the blue wave these were hoping for in the U.S. election, but just five status marijuana legalization measures on the ballot have passed. Recreational and/or medical marijuana was legalized in Arizona, Mississippi, Montana, South Dakota and new Jersey, increasing the possible geographic footprint of cannabis multistate operators, or maybe MSOs. Unfortunately for cannabis investors, Democrats may not gain control of the Senate, potentially restricting significant federal cannabis reform. As a result, some cannabis stocks initially dropped following the election. Allow me to share the best cannabis stocks to purchase following the election, as reported by Cantor Fitzgerald.
Flower priced depreciation has long been a big problem for all Canadian licensed producers, or perhaps LPs. Nevertheless, analyst Pablo Zuanic says Canadian LPs like Aphria might have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes over the White House. Federal legalization may well still be no less than 2 years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis may increase Aphria along with other Canadian LPs, Zuanic states. 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 in 2020. Zuanic affirms OrganiGram’s retail sales trends in the third quarter were fairly strong in comparison with various other Canadian LPs. Nevertheless, Hifyre cannabis sales information for October suggest OrganiGram sales had been down twenty five % month over month in contrast to a 5 % decline for the entire Canadian retail store. OrganiGram has disappointed investors with its sluggish revenue growth as well as money burn, but Zuanic is actually hopeful the small business will see 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 struggling, U.S. multistate operators as Cresco Labs are thriving. In the second quarter, Cresco beat consensus analyst sales estimates by 30 % and exceeded the earnings of theirs before interest, taxes, depreciation and amortization expectations by nearly 200 %. Zuanic affirms Cresco’s 42 % sequential sales progress in the second quarter was the very best growth rate among many of Cresco’s large MSO peers. Zuanic states the Illinois industry will be a major near term growth driver for Cresco, and its Origin House acquisition ought to supplement the natural growth of its. Cantor Fitzgerald has an “overweight” rating and sixteen dolars price target for CRLBF inventory.
Curaleaf is a U.S. MSO that works in 23 states. Among those states is New Jersey, which may represent probably the largest opportunity among the states that legalized recreational marijuana on Election Day. Not simply will Curaleaf gain from the brand new Jersey sector, but Zuanic says Curaleaf will probably draw clients from neighboring New York and Pennsylvania. Curaleaf noted impressive 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 eighteen dolars price target for CURLF inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO which runs in 12 states, including California as well as Florida. Zuanic claims Green Thumb has the best risk profile of Cantor’s top-rated MSOs. Green Thumb has expanded its footprint in Pennsylvania and Illinois without overextending its balance sheet, it already has a sizable presence in New Jersey and Zuanic is actually projecting revenue will grow from $527 million in 2020 to $982 million by 2022. Also, he anticipates additional legalization in 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 an MSO that operates primarily in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After talking with Rivers, Zuanic says he is confident in Trulieve’s capacity to maintain a dominant market share of the high-growth Florida medical marijuana industry. In addition, Zuanic affirms Trulieve has a tremendous chance to produce the companies of its in other states, including California, Massachusetts and Connecticut. Finally, he is optimistic Florida voters can legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and sixty dolars cost target for TCNNF inventory.
GW Pharmaceuticals (GWPH)
As opposed to the other cannabis stocks on this list, GW Pharmaceuticals is 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 therapy 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 conclusion of 2021, which includes further penetration into additional rollout and adult customers in Europe. Cantor has an “overweight” rating and $165 cost target for GWPH inventory.