The election results are bullish for marijuana stocks.
Cannabis stock investors did not get the blue wave they were hoping for in the U.S. election, but all 5 status marijuana legalization methods 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 best cannabis stocks to purchase following the election, based on Cantor Fitzgerald.
Flower priced depreciation has long been a major issue for almost all Canadian licensed producers, or maybe LPs. But, analyst Pablo Zuanic says Canadian LPs as Aphria could have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes over the White House. Federal legalization may well still be at least two years away, but decriminalization of adult use marijuana and potential federal rescheduling of cannabis may raise Aphria and other Canadian LPs, Zuanic states. He claims Aphria has multiple positive catalysts in front in the near term, including a surge in 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 tells you OrganiGram’s retail sales trends in the third quarter had been relatively strong in contrast to other Canadian LPs. Nevertheless, Hifyre cannabis sales data for October recommend OrganiGram sales had been down twenty five % month over month compared with a 5 % decline for the overall Canadian retail market. OrganiGram has disappointed investors with the sluggish revenue growth of its and cash burn up, but Zuanic is optimistic the company will find its way to growth and profits in the long run. Cantor Fitzgerald has an “overweight” rating and $4.07 cost target for OGI inventory.
While Canadian cannabis stocks are actually struggling, U.S. multistate operators as Cresco Labs are actually thriving. In the next quarter, Cresco beat consensus analyst sales estimates by 30 % and exceeded their earnings before amortization expectations, depreciation, taxes, and interest by nearly 200 %. Zuanic says Cresco’s forty two % sequential sales growth in the second quarter was the best growth rate with all of Cresco’s big MSO peers. Zuanic alleges the Illinois market is going to be a major near-term growth driver for Cresco, and the Origin House acquisition of its ought to supplement its organic growth. Cantor Fitzgerald has an “overweight” rating and $16 cost target for CRLBF stock.
Curaleaf is a U.S. MSO which runs in 23 states. Among those states is New Jersey, that might represent the largest opportunity among the states which legalized recreational marijuana on Election Day. Not only will Curaleaf gain from the brand new Jersey market, but Zuanic says Curaleaf may draw clients from neighboring New York and Pennsylvania. Curaleaf reported impressive 142 % revenue growth as well as 180 % disgusting earnings development 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 inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO which works in twelve states, like California as well as Florida. Zuanic claims Green Thumb has the ideal risk profile of Cantor’s top rated MSOs. Green Thumb has expanded its footprint in Pennsylvania and Illinois without overextending its balance sheet, it currently 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 of Pennsylvania, New York, Connecticut as well as Maryland in coming years. Cantor Fitzgerald has an “overweight” rating and twenty nine dolars price 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’s confident in Trulieve’s ability to keep a dominant market share of the high-growth Florida medical marijuana industry. In addition, Zuanic affirms Trulieve includes a tremendous alternative to produce its companies in other states, like California, Massachusetts and Connecticut. Lastly, he’s optimistic Florida voters might legalize recreational marijuana in the 2022 midterm election. Cantor Fitzgerald has an “overweight” rating and $60 cost target for TCNNF stock.
GW Pharmaceuticals (GWPH)
As opposed to the various other cannabis stocks on this list, GW Pharmaceuticals is a biopharmaceutical business centered on creating cannabis-based drug treatments. The company’s lead drug Epidiolex has been approved by the Food and Drug Administration for the treatment 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 more rollout and adult people in Europe. Cantor has an “overweight” rating and $165 cost target for GWPH stock.