The election results are actually bullish for marijuana stocks.
Cannabis stock investors didn’t get the blue wave they were hoping for in the U.S. election, but all five state 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 may not gain control of the Senate, possibly limiting considerable federal cannabis reform. As a result, some cannabis stocks initially dropped following the election. Here are the best cannabis stocks to purchase following the election, as reported by Cantor Fitzgerald.
Flower priced depreciation continues to be a big problem for all Canadian licensed producers, or maybe LPs. However, analyst Pablo Zuanic says 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 might still be no less than two years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis can increase Aphria and other Canadian LPs, Zuanic states. He claims Aphria has multiple positive catalysts forward in the near term, including an increase in 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 says OrganiGram’s retail sales trends in the third quarter were fairly strong compared with other Canadian LPs. Nevertheless, Hifyre cannabis sales information for October recommend OrganiGram sales had been down 25 % month over month in contrast to a five % decline for the entire Canadian retail market. OrganiGram has disappointed investors with the sluggish revenue growth of its and cash burn, but Zuanic is actually optimistic the small business may find the way of its to growth and earnings in the long term. Cantor Fitzgerald has an “overweight” rating and $4.07 cost target for OGI inventory.
While Canadian cannabis stocks are struggling, U.S. multistate operators as Cresco Labs are thriving. In the second quarter, Cresco beat consensus analyst sales estimates by 30 % and exceeded their earnings before interest, taxes, depreciation and amortization expectations by almost 200 %. Zuanic tells you Cresco’s 42 % sequential sales progress in the next quarter was the very best growth rate with almost all of Cresco’s big MSO peers. Zuanic states the Illinois industry will be a major near term growth driver for Cresco, and its Origin House acquisition should supplement its organic growth. Cantor Fitzgerald has an “overweight” rating and $16 price target for CRLBF inventory.
Curaleaf is actually a U.S. MSO that runs in 23 states. One of those states is New Jersey, which might represent probably the largest opportunity with the states that legalized recreational marijuana on Election Day. Not merely will Curaleaf benefit from the new Jersey sector, but Zuanic says Curaleaf may draw clients from neighboring New York and Pennsylvania. Curaleaf reported impressive 142 % revenue growth as well as 180 % disgusting profit growth year over year in the second quarter and also holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and $18 cost target for CURLF stock.
Green Thumb Industries (GTBIF)
Green Thumb Industries is actually a U.S. MSO which works in twelve states, including California as well as Florida. Zuanic states Green Thumb has the best risk profile of Cantor’s top rated MSOs. Green Thumb has expanded the footprint of its in Illinois and Pennsylvania without overextending the balance sheet of its, 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. Also, he anticipates additional legalization in Pennsylvania, New York, Maryland as well as Connecticut in coming years. Cantor Fitzgerald has an “overweight” rating and twenty nine dolars cost target for GTBIF inventory.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is actually an MSO that operates 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 maintain a dominant market share of the high growth Florida medical marijuana market. In addition, Zuanic says Trulieve features a tremendous opportunity to produce its businesses in other states, like Connecticut, Massachusetts, and California. Last but not least, 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)
As opposed to the other cannabis stocks on this list, GW Pharmaceuticals is a biopharmaceutical company focused on developing cannabis-based drug therapies. 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 the expectations of his. He also sees several bullish catalysts for GW through the tail end of 2021, including further penetration into more rollout and adult individuals in Europe. Cantor has an “overweight” rating and $165 price target for GWPH stock.