The election results are bullish for marijuana stocks.
Cannabis stock investors didn’t get the blue wave these were hoping for in the U.S. election, but just 5 status marijuana legalization measures 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 perhaps MSOs. Unfortunately for cannabis investors, Democrats may not gain control of the Senate, potentially restricting considerable federal cannabis reform. Being a result, some cannabis stocks initially dropped following the election. Here are the very best cannabis stocks to invest in following the election, as reported by Cantor Fitzgerald.
Flower price depreciation continues to be a significant problem for just about all Canadian licensed producers, or LPs. Nevertheless, analyst Pablo Zuanic states Canadian LPs as Aphria might 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 could raise Aphria and other Canadian LPs, Zuanic states. He claims Aphria has multiple positive catalysts ahead in the near term, including a surge 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 tells you OrganiGram’s retail sales trends in the third quarter had been fairly strong compared with various other Canadian LPs. But, Hifyre cannabis sales information for October suggest 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 up, but Zuanic is actually optimistic the business will find its way to growth and earnings in the long haul. Cantor Fitzgerald has an “overweight” rating and $4.07 cost target for OGI stock.
While Canadian cannabis stocks are struggling, U.S. multistate operators as Cresco Labs are actually thriving. In the next quarter, Cresco beat consensus analyst sales estimates by thirty % and exceeded the earnings of theirs before amortization expectations, depreciation, taxes, and interest by about 200 %. Zuanic tells you Cresco’s forty two % sequential sales development in the second quarter was the best growth rate with almost all of Cresco’s large MSO peers. Zuanic alleges the Illinois market will be a leading near-term growth driver for Cresco, and the Origin House acquisition of its should supplement the organic growth of its. Cantor Fitzgerald has an “overweight” rating and sixteen dolars price target for CRLBF inventory.
Curaleaf is a U.S. MSO that works in 23 states. Among those states is New Jersey, which might represent probably the largest opportunity among the states that legalized recreational marijuana on Election Day. Not only will Curaleaf benefit from the brand new Jersey sector, but Zuanic says Curaleaf will likely draw clients from neighboring New York and Pennsylvania. Curaleaf noted astounding 142 % revenue growth and 180 % gross profit 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 stock.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO that runs in twelve states, including Florida and California. Zuanic reveals Green Thumb has the best risk profile of Cantor’s top rated MSOs. Green Thumb has expanded its footprint in Illinois and Pennsylvania without overextending the balance sheet of its, it already has a sizable presence in New Jersey and Zuanic is projecting revenue will grow from $527 million in 2020 to $982 million by 2022. He also anticipates further legalization of Pennsylvania, New York, Maryland as well as Connecticut in coming years. Cantor Fitzgerald has an “overweight” rating and twenty nine dolars price target for GTBIF inventory.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is an MSO which works primarily in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After speaking with Rivers, Zuanic says he’s comfortable in Trulieve’s capacity to keep a dominant market share of the high-growth Florida medical marijuana industry. Furthermore, Zuanic says Trulieve features a tremendous opportunity to produce the companies of its in some other states, like Connecticut, Massachusetts, and California. 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)
In contrast to the various other cannabis stocks on this list, GW Pharmaceuticals is a biopharmaceutical company centered on developing cannabis-based drug treatments. The company’s lead drug Epidiolex has been approved by the Food as well as Drug Administration for the therapy 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 tail end of 2021, which includes further penetration into adult customers and additional rollout in Europe. Cantor has an “overweight” rating and $165 price target for GWPH inventory.