The election results are bullish for marijuana stocks.
Cannabis stock investors did not get the blue wave they were hoping for in the U.S. election, but all 5 status marijuana legalization procedures 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 MSOs. Unfortunately for cannabis investors, Democrats might not gain control of the Senate, potentially restricting considerable federal cannabis reform. As a result, some cannabis stocks initially dropped following the election. Allow me to share the very best cannabis stocks to purchase following the election, based on Cantor Fitzgerald.
Flower price depreciation has long been an important concern for just about all Canadian licensed producers, or maybe LPs. Nonetheless, analyst Pablo Zuanic reveals Canadian LPs as Aphria could have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes more than the White House. Federal legalization may still be a minimum of 2 years away, but decriminalization of adult use marijuana and potential federal rescheduling of cannabis can boost Aphria and other Canadian LPs, Zuanic states. He claims Aphria has a number of positive catalysts ahead in the near term, including an increase 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 had been fairly strong compared with various other Canadian LPs. However, Hifyre cannabis sales information for October suggest OrganiGram sales had been down 25 % month over month compared with a 5 % decline for the entire Canadian retail store. OrganiGram has disappointed investors with the sluggish revenue growth of its and money burn, but Zuanic is actually optimistic the business may find its way to growth and earnings in the long term. Cantor Fitzgerald has an “overweight” rating and $4.07 price target for OGI inventory.
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 interest, taxes, depreciation and amortization expectations by nearly 200 %. Zuanic says Cresco’s 42 % sequential sales advancement in the next quarter was the very best growth rates among almost all of Cresco’s big MSO peers. Zuanic states the Illinois market is going to be a major near-term growth driver for Cresco, and its Origin House acquisition ought to supplement the organic growth of its. Cantor Fitzgerald has an “overweight” rating and sixteen dolars price target for CRLBF stock.
Curaleaf is a U.S. MSO that runs in twenty three states. One of those states is actually New Jersey, which might represent probably the largest opportunity among the states which legalized recreational marijuana on Election Day. Not simply 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 impressive 142 % revenue growth and 180 % disgusting earnings growth year over year in the next quarter and 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 operates in twelve states, like Florida and California. Zuanic states 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 Jersey and Zuanic is actually projecting revenue will develop from $527 million in 2020 to $982 million by 2022. Additionally, he anticipates additional legalization of Pennsylvania, New York, Maryland as well as Connecticut in coming years. Cantor Fitzgerald has an “overweight” rating and $29 price target for GTBIF stock.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is actually an MSO which operates largely in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After talking with Rivers, Zuanic says he is comfortable in Trulieve’s potential to maintain a dominant market share of the high growth Florida medical marijuana market. Additionally, Zuanic affirms Trulieve features a substantial opportunity to produce its companies in some other states, including California, Massachusetts and Connecticut. Last but not least, he is optimistic Florida voters could legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and $60 price target for TCNNF stock.
GW Pharmaceuticals (GWPH)
Unlike the various other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical business focused 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 assorted bullish catalysts for GW through the tail end of 2021, including further penetration into adult clients and more rollout in Europe. Cantor has an “overweight” rating and $165 cost target for GWPH stock.