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. 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 might not gain control of the Senate, possibly restricting significant federal cannabis reform. To be a result, some cannabis stocks initially dropped following the election. Allow me to share the best cannabis stocks to purchase following the election, based on Cantor Fitzgerald.
Flower priced depreciation has been a significant issue for almost all Canadian licensed producers, or maybe LPs. But, analyst Pablo Zuanic says Canadian LPs as Aphria might have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes over the White House. Federal legalization might still be no less than 2 years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis could boost Aphria as well as other Canadian LPs, Zuanic says. He states Aphria has several positive catalysts ahead in the near term, including a surge in exports. Cantor Fitzgerald has an “overweight” rating and $8.95 price target for APHA stock.
Canadian LP OrganiGram has had a brutal year in 2020. Zuanic says OrganiGram’s retail sales trends in the third quarter were relatively strong in contrast to various other Canadian LPs. But, Hifyre cannabis sales information for October suggest OrganiGram sales had been down twenty five % month over month compared with a five % decline for the overall Canadian retail store. OrganiGram has disappointed investors with the sluggish revenue growth of its as well as money burn up, but Zuanic is optimistic the small business will find its way to profits and growth in the long haul. Cantor Fitzgerald has an “overweight” rating and $4.07 cost target for OGI inventory.
While Canadian cannabis stocks are 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 amortization expectations, depreciation, taxes, and interest by almost 200 %. Zuanic tells you Cresco’s forty two % sequential sales progress in the next quarter was the very best growth rates among many of Cresco’s large MSO peers. Zuanic alleges the Illinois market is going to be a leading near-term growth driver for Cresco, and the Origin House acquisition of its ought to supplement its natural growth. Cantor Fitzgerald has an “overweight” rating and sixteen dolars cost target for CRLBF inventory.
Curaleaf is a U.S. MSO that runs in 23 states. Among those states is actually New Jersey, which might represent probably the largest opportunity with the states that legalized recreational marijuana on Election Day. Not merely will Curaleaf gain from the brand new Jersey sector, but Zuanic says Curaleaf will likely draw customers from neighboring New York and Pennsylvania. Curaleaf noted astounding 142 % revenue growth and 180 % gross earnings growth year over year in the second quarter and holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and eighteen dolars cost target for CURLF inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is actually a U.S. MSO that operates in 12 states, including Florida and California. Zuanic reveals 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 Jersey and Zuanic is actually projecting revenue will grow from $527 million in 2020 to $982 million by 2022. Additionally, he anticipates further legalization of Pennsylvania, New York, Maryland and 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’s comfortable in Trulieve’s ability to keep a dominant market share of the high-growth Florida medical marijuana market. Furthermore, Zuanic affirms Trulieve includes a substantial chance to produce its companies in some 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 price target for TCNNF stock.
GW Pharmaceuticals (GWPH)
Unlike the various other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical company focused on creating cannabis-based drug therapies. The company’s lead drug Epidiolex has been approved by the Food as well as Drug Administration for the treatment of pediatric epilepsy. Cantor analyst Charles Duncan states GW’s third-quarter Epidiolex sales exceeded his expectations. He also sees assorted bullish catalysts for GW with the end of 2021, including further penetration into adult individuals and more rollout in Europe. Cantor has an “overweight” rating and $165 price target for GWPH inventory.