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 just 5 status marijuana legalization measures on the ballot have passed. Fun and/or medical marijuana was legalized in Arizona, Mississippi, Montana, new Jersey and South Dakota, increasing the potential geographic footprint of cannabis multistate operators, or MSOs. Unfortunately for cannabis investors, Democrats may not gain control of the Senate, possibly limiting considerable federal cannabis reform. To be a result, some cannabis stocks initially dropped following the election. Allow me to share the best cannabis stocks to invest in following the election, based on Cantor Fitzgerald.
Flower price depreciation continues to be a big problem for just about all Canadian licensed producers, or maybe LPs. Nonetheless, analyst Pablo Zuanic states Canadian LPs like Aphria may 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 can raise Aphria as well as other Canadian LPs, Zuanic states. He says Aphria has a number of positive catalysts forward in the near term, including a rise in 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 in comparison with other Canadian LPs. Nonetheless, Hifyre cannabis sales information for October recommend OrganiGram sales had been down 25 % month over month in contrast to a 5 % 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 actually hopeful the small business may find its way to growth and profits 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 interest, taxes, depreciation and amortization expectations by almost 200 %. Zuanic affirms Cresco’s 42 % sequential sales expansion in the next quarter was the very best growth rates among almost all of Cresco’s big MSO peers. Zuanic says the Illinois industry will be a major near-term growth driver for Cresco, and its Origin House acquisition should supplement the natural growth of its. Cantor Fitzgerald has an “overweight” rating and sixteen dolars cost target for CRLBF stock.
Curaleaf is actually a U.S. MSO which runs in twenty three states. Among those states is actually New Jersey, which might 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 likely draw clients from neighboring Pennsylvania and New York. Curaleaf reported impressive 142 % revenue growth as well as 180 % disgusting profit growth year over year in the second quarter and holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and $18 cost target for CURLF inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO that operates in twelve states, like Florida and California. Zuanic states Green Thumb has the ideal 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 Zuanic and Jersey is projecting revenue will grow 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 works primarily in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After talking with Rivers, Zuanic says he’s comfortable in Trulieve’s potential to keep a dominant market share of the high growth Florida medical marijuana industry. Furthermore, Zuanic affirms Trulieve features a tremendous alternative to grow its businesses in some other states, like Connecticut, Massachusetts, and California. Lastly, he is upbeat Florida voters could legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and $60 cost target for TCNNF inventory.
GW Pharmaceuticals (GWPH)
Unlike the various other cannabis stocks on this list, GW Pharmaceuticals is a biopharmaceutical company focused on developing cannabis-based drug treatments. 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 states GW’s third quarter Epidiolex sales exceeded the expectations of his. Also, he sees assorted bullish catalysts for GW through the conclusion of 2021, which includes further penetration into adult individuals and more rollout in Europe. Cantor has an “overweight” rating and $165 price target for GWPH stock.