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 just 5 status 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 perhaps MSOs. Unfortunately for cannabis investors, Democrats might not gain control of the Senate, potentially restricting considerable federal cannabis reform. As a result, some cannabis stocks initially dropped following the election. Here are the very best cannabis stocks to buy following the election, according to Cantor Fitzgerald.
Flower price depreciation has been a big concern for just about all Canadian licensed producers, or 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 might still be at least two years away, but decriminalization of adult use marijuana and potential federal rescheduling of cannabis could boost Aphria along with other Canadian LPs, Zuanic states. He says Aphria has multiple positive catalysts in front 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 in 2020. Zuanic tells you OrganiGram’s retail sales trends in the third quarter had been relatively strong in comparison with other Canadian LPs. However, 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 market. OrganiGram has disappointed investors with the sluggish revenue growth of its as well as money burn up, but Zuanic is optimistic the company will find its way to growth and profits in the long term. Cantor Fitzgerald has an “overweight” rating and $4.07 price target for OGI stock.
While Canadian cannabis stocks are actually struggling, U.S. multistate operators as Cresco Labs are actually thriving. In the second quarter, Cresco beat consensus analyst sales estimates by 30 % and exceeded their earnings before amortization expectations, depreciation, taxes, and interest by about 200 %. Zuanic says Cresco’s forty two % sequential sales advancement in the next quarter was the most effective growth rates among all of Cresco’s big MSO peers. Zuanic says the Illinois industry will be a serious near-term growth driver for Cresco, and the Origin House acquisition of its 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 which runs in twenty three states. Among those states is actually New Jersey, which might represent the largest opportunity with the states which legalized recreational marijuana on Election Day. Not merely will Curaleaf benefit from the brand new Jersey market, but Zuanic says Curaleaf will likely draw clients from neighboring Pennsylvania and New York. Curaleaf noted astounding 142 % revenue growth and 180 % gross 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 stock.
Green Thumb Industries (GTBIF)
Green Thumb Industries is actually a U.S. MSO which runs in 12 states, including California and Florida. Zuanic says Green Thumb has the ideal risk profile of Cantor’s top-rated MSOs. Green Thumb has expanded the footprint of its in Pennsylvania and Illinois without overextending its balance sheet, it currently has a sizable presence in New Jersey and Zuanic is projecting revenue will mature from $527 million in 2020 to $982 million by 2022. Additionally, he anticipates further legalization in Pennsylvania, New York, Maryland and 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 runs 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 potential to keep a dominant market share of the high-growth Florida medical marijuana industry. In addition, Zuanic says Trulieve features a substantial opportunity to produce its businesses in other states, including Connecticut, Massachusetts, and California. Finally, he is upbeat Florida voters might legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and sixty dolars price target for TCNNF inventory.
GW Pharmaceuticals (GWPH)
In contrast to the other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical business centered 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. Also, he sees several bullish catalysts for GW through the end of 2021, including further penetration into additional rollout and adult patients in Europe. Cantor has an “overweight” rating and $165 cost target for GWPH inventory.