The election results are actually bullish for marijuana stocks.
Cannabis stock investors did not get the blue wave these were hoping for in the U.S. election, but just five state marijuana legalization measures on the ballot have passed. Recreational and/or medical marijuana was legalized in Arizona, Mississippi, Montana, new Jersey and South Dakota, increasing the potential geographic footprint of cannabis multistate operators, or maybe MSOs. Unfortunately for cannabis investors, Democrats may not gain control of the Senate, possibly limiting considerable federal cannabis reform. Being a result, some cannabis stocks initially dropped following the election. Here are the very best cannabis stocks to purchase following the election, as reported by Cantor Fitzgerald.
Flower price depreciation continues to be a big concern for all Canadian licensed producers, or LPs. Nevertheless, analyst Pablo Zuanic claims 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 no less than 2 years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis can boost Aphria as well as other Canadian LPs, Zuanic says. He states Aphria has several positive catalysts forward 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 of 2020. Zuanic affirms OrganiGram’s retail sales trends in the third quarter were relatively strong compared with various other Canadian LPs. Nonetheless, Hifyre cannabis sales data for October suggest OrganiGram sales were down twenty five % month over month in contrast to a five % decline for the entire Canadian retail store. OrganiGram has disappointed investors with its sluggish revenue growth as well as money burn up, but Zuanic is hopeful the small business will see its way to growth and earnings in the long run. Cantor Fitzgerald has an “overweight” rating and $4.07 price target for OGI stock.
While Canadian cannabis stocks are struggling, U.S. multistate operators like 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 nearly 200 %. Zuanic says Cresco’s forty two % sequential sales advancement in the next quarter was the best growth rates with almost all of Cresco’s large MSO peers. Zuanic alleges the Illinois industry is going to be a serious near term growth driver for Cresco, and its Origin House acquisition ought to supplement its organic growth. Cantor Fitzgerald has an “overweight” rating and $16 price target for CRLBF stock.
Curaleaf is actually a U.S. MSO that works in twenty three states. One of those states is actually New Jersey, which may represent the largest opportunity with the states which legalized recreational marijuana on Election Day. Not only will Curaleaf benefit from the new Jersey market, but Zuanic says Curaleaf will likely draw customers from neighboring New York and Pennsylvania. Curaleaf reported impressive 142 % revenue growth and 180 % disgusting profit 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 which operates in twelve states, including California and Florida. Zuanic says Green Thumb has the best risk profile of Cantor’s top rated MSOs. Green Thumb has expanded its footprint in Pennsylvania and Illinois 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. Also, he anticipates further 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 stock.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is actually an MSO which operates primarily in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After talking with Rivers, Zuanic says he is comfortable in Trulieve’s capacity to maintain a dominant market share of the high growth Florida medical marijuana market. In addition, Zuanic says Trulieve includes a tremendous alternative to produce the companies of its in other states, like Connecticut, Massachusetts, and California. Lastly, he is upbeat 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)
In contrast to the various other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical company focused on creating 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 says GW’s third-quarter Epidiolex sales exceeded the expectations of his. He also sees assorted bullish catalysts for GW through the tail end of 2021, which includes further penetration into adult patients and more rollout in Europe. Cantor has an “overweight” rating and $165 cost target for GWPH inventory.