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 all 5 state marijuana legalization methods 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 MSOs. Unfortunately for cannabis investors, Democrats might not gain control of the Senate, potentially restricting considerable federal cannabis reform. To be a result, a few cannabis stocks initially dropped following the election. Allow me to share the best cannabis stocks to invest in following the election, according to Cantor Fitzgerald.
Flower priced depreciation has long been an important issue for all Canadian licensed producers, or maybe LPs. Nevertheless, analyst Pablo Zuanic states Canadian LPs like Aphria might have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes more than the White House. Federal legalization may still be no less than two years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis could increase Aphria as well as other Canadian LPs, Zuanic says. He says Aphria has multiple positive catalysts in front in the near term, including a rise of exports. Cantor Fitzgerald has an “overweight” rating and $8.95 cost target for APHA stock.
Canadian LP OrganiGram has had a brutal year in 2020. Zuanic affirms OrganiGram’s retail sales trends in the third quarter had been relatively strong in contrast to various other Canadian LPs. However, Hifyre cannabis sales information for October suggest OrganiGram sales had been down twenty five % month over month in contrast to a five % decline for the overall Canadian retail store. OrganiGram has disappointed investors with its sluggish revenue growth as well as money burn up, but Zuanic is optimistic the business will see the way of its to earnings and growth in the long haul. Cantor Fitzgerald has an “overweight” rating and $4.07 price target for OGI stock.
While Canadian cannabis stocks are struggling, U.S. multistate operators as Cresco Labs are thriving. In the next 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 growth in the next quarter was the top growth rate with many 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 ought to supplement the natural growth of its. Cantor Fitzgerald has an “overweight” rating and sixteen dolars price target for CRLBF inventory.
Curaleaf is actually a U.S. MSO that operates in twenty three states. Among those states is New Jersey, that might represent the largest opportunity with the states that legalized recreational marijuana on Election Day. Not only will Curaleaf gain from the brand new Jersey sector, but Zuanic says Curaleaf will likely draw clients from neighboring New York and Pennsylvania. Curaleaf noted impressive 142 % revenue growth as well as 180 % gross 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 eighteen dolars price target for CURLF inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO that operates in 12 states, like California as well as Florida. Zuanic states Green Thumb has the ideal 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 projecting revenue will develop 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 cost target for GTBIF stock.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is actually an MSO which works largely in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After speaking with Rivers, Zuanic says he is comfortable in Trulieve’s ability to keep a dominant market share of the high growth Florida medical marijuana market. Moreover, Zuanic says Trulieve has a tremendous alternative to grow its businesses in some other states, including California, Massachusetts and Connecticut. Lastly, he is optimistic Florida voters might legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and $60 cost target for TCNNF inventory.
GW Pharmaceuticals (GWPH)
As opposed to the various other cannabis stocks on this list, GW Pharmaceuticals is a biopharmaceutical company focused on creating 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 says GW’s third quarter Epidiolex sales exceeded the expectations of his. Also, he sees assorted bullish catalysts for GW through the end of 2021, including further penetration into more rollout and adult people in Europe. Cantor has an “overweight” rating and $165 cost target for GWPH inventory.