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 all 5 state marijuana legalization measures on the ballot have passed. Fun 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 perhaps MSOs. Unfortunately for cannabis investors, Democrats may not gain control of the Senate, potentially restricting considerable federal cannabis reform. Being a result, a few cannabis stocks initially dropped following the election. Allow me to share the very best cannabis stocks to purchase following the election, according to Cantor Fitzgerald.
Flower price depreciation continues to be a major problem for all Canadian licensed producers, or perhaps LPs. But, analyst Pablo Zuanic reveals Canadian LPs like Aphria might have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes more than the White House. Federal legalization might still be a minimum of two years away, but decriminalization of adult use marijuana and potential federal rescheduling of cannabis can boost Aphria as well as other Canadian LPs, Zuanic says. He states Aphria has several positive catalysts forward in the near term, including a rise 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 says OrganiGram’s retail sales trends in the third quarter were fairly strong compared with various other Canadian LPs. But, Hifyre cannabis sales information for October recommend OrganiGram sales had been down twenty five % month over month compared with a five % decline for the overall Canadian retail market. OrganiGram has disappointed investors with the sluggish revenue growth of its and cash burn up, but Zuanic is actually optimistic the business will see its way to earnings and growth in the long haul. Cantor Fitzgerald has an “overweight” rating and $4.07 cost target for OGI stock.
While Canadian cannabis stocks are actually 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 about 200 %. Zuanic says Cresco’s 42 % sequential sales expansion in the second quarter was the very best growth rate among almost all of Cresco’s large MSO peers. Zuanic states the Illinois market will be a major near-term growth driver for Cresco, and its Origin House acquisition should supplement its organic growth. Cantor Fitzgerald has an “overweight” rating and sixteen dolars cost target for CRLBF inventory.
Curaleaf is actually a U.S. MSO which works in 23 states. Among those states is actually New Jersey, that might represent probably the largest opportunity among the states that legalized recreational marijuana on Election Day. Not merely will Curaleaf benefit from the new Jersey sector, but Zuanic says Curaleaf will likely draw clients from neighboring Pennsylvania and New York. Curaleaf noted impressive 142 % revenue growth as well as 180 % gross earnings growth year over year in the next quarter and holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and eighteen dolars cost target for CURLF stock.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO which works in twelve states, including Florida as well as California. Zuanic says Green Thumb has the very best risk profile of Cantor’s top rated MSOs. Green Thumb has expanded its footprint in Pennsylvania and Illinois without overextending the balance sheet of its, it currently has a sizable presence in New Jersey and Zuanic is projecting revenue will grow from $527 million in 2020 to $982 million by 2022. Also, he anticipates additional legalization of Pennsylvania, New York, Maryland and Connecticut in coming years. Cantor Fitzgerald has an “overweight” rating and twenty nine dolars cost target for GTBIF stock.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is actually an MSO which runs largely in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After talking with Rivers, Zuanic says he’s confident in Trulieve’s ability to maintain a dominant market share of the high growth Florida medical marijuana industry. Moreover, Zuanic says Trulieve includes a tremendous chance to grow the businesses of its in some other states, including California, Massachusetts and Connecticut. Lastly, he’s optimistic Florida voters might 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)
Unlike the various other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical company focused on developing cannabis-based drug therapies. The company’s lead drug Epidiolex has been approved by the Food and Drug Administration for the therapy 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 through the tail end of 2021, which includes further penetration into additional rollout and adult individuals in Europe. Cantor has an “overweight” rating and $165 price target for GWPH inventory.