The election results are bullish for marijuana stocks.
Cannabis stock investors did not get the blue wave these were hoping for in the U.S. election, but all five 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 potential geographic footprint of cannabis multistate operators, or perhaps MSOs. Unfortunately for cannabis investors, Democrats may not gain control of the Senate, potentially limiting considerable federal cannabis reform. To be a result, some cannabis stocks initially dropped following the election. Here are the best cannabis stocks to invest in following the election, as reported by Cantor Fitzgerald.
Flower priced depreciation has been a big concern for just about all Canadian licensed producers, or LPs. Nonetheless, analyst Pablo Zuanic reveals Canadian LPs like Aphria may have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes over the White House. Federal legalization may still be a minimum of two years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis may boost Aphria as well as other Canadian LPs, Zuanic states. He says Aphria has a number of positive catalysts in front in the near term, including a surge in exports. Cantor Fitzgerald has an “overweight” rating and $8.95 cost target for APHA stock.
Canadian LP OrganiGram has had a brutal year of 2020. Zuanic affirms OrganiGram’s retail sales trends in the third quarter had been relatively strong compared with various other Canadian LPs. However, Hifyre cannabis sales information for October recommend OrganiGram sales were down 25 % month over month compared with a 5 % decline for the complete Canadian retail market. OrganiGram has disappointed investors with its sluggish revenue growth and money burn, but Zuanic is actually optimistic the business may find its way to profits and growth in the long run. 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 like Cresco Labs are actually thriving. In the second quarter, Cresco beat consensus analyst sales estimates by thirty % and exceeded the earnings of theirs before interest, taxes, depreciation and amortization expectations by nearly 200 %. Zuanic says Cresco’s 42 % sequential sales expansion in the next quarter was the very best growth rate among almost all of Cresco’s big MSO peers. Zuanic says the Illinois market is going to be a major near term growth driver for Cresco, and the Origin House acquisition of its ought to supplement the natural growth of its. Cantor Fitzgerald has an “overweight” rating and $16 cost target for CRLBF stock.
Curaleaf is a U.S. MSO that works in 23 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 market, but Zuanic says Curaleaf will likely draw customers from neighboring New York and Pennsylvania. Curaleaf noted amazing 142 % revenue growth and 180 % disgusting earnings development year over year in the next quarter and also 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 which works in twelve states, including California and Florida. 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 currently has a sizable presence in New Zuanic and Jersey is projecting revenue will mature from $527 million in 2020 to $982 million by 2022. Also, he anticipates further legalization in Pennsylvania, New York, Maryland as well as Connecticut 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 that works largely in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After speaking with Rivers, Zuanic says he is confident in Trulieve’s potential to keep a dominant market share of the high-growth Florida medical marijuana industry. Moreover, Zuanic affirms Trulieve features a tremendous chance to grow the companies of its in other states, including California, Massachusetts and Connecticut. Finally, 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 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 treatment of pediatric epilepsy. Cantor analyst Charles Duncan states 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 adult people and additional rollout in Europe. Cantor has an “overweight” rating and $165 price target for GWPH inventory.