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 state marijuana legalization methods on the ballot have passed. Fun and/or medical marijuana was legalized in Arizona, Mississippi, Montana, new Jersey and South Dakota, increasing the possible geographic footprint of cannabis multistate operators, or maybe MSOs. Unfortunately for cannabis investors, Democrats may 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 buy following the election, according to Cantor Fitzgerald.
Flower price depreciation has been a big concern for all Canadian licensed producers, or perhaps LPs. However, analyst Pablo Zuanic claims 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 still be no less than 2 years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis could raise 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 stock.
Canadian LP OrganiGram has had a brutal year in 2020. Zuanic affirms OrganiGram’s retail sales trends in the third quarter were relatively strong compared with other Canadian LPs. However, Hifyre cannabis sales data for October suggest OrganiGram sales had been down 25 % month over month compared with a 5 % decline for the entire Canadian retail market. OrganiGram has disappointed investors with its sluggish revenue growth and money burn, but Zuanic is hopeful the company will see its way 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 like Cresco Labs are actually thriving. In the next quarter, Cresco beat consensus analyst sales estimates by thirty % and exceeded their earnings before interest, taxes, depreciation and amortization expectations by about 200 %. Zuanic tells you Cresco’s 42 % sequential sales advancement in the next quarter was the best growth rate with almost all of Cresco’s large MSO peers. Zuanic states the Illinois industry will 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 sixteen dolars price target for CRLBF inventory.
Curaleaf is a U.S. MSO that operates in twenty three states. Among those states is New Jersey, which might represent probably the largest opportunity among the states that legalized recreational marijuana on Election Day. Not simply will Curaleaf gain from the new Jersey market, but Zuanic says Curaleaf will likely draw customers from neighboring New York and Pennsylvania. Curaleaf noted impressive 142 % revenue growth as well as 180 % gross profit development year over year in the next quarter and holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and eighteen dolars cost target for CURLF stock.
Green Thumb Industries (GTBIF)
Green Thumb Industries is actually a U.S. MSO which works in twelve states, like Florida and California. 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 currently has a sizable presence in New Jersey and Zuanic is projecting revenue will develop from $527 million in 2020 to $982 million by 2022. Also, he anticipates additional legalization of Pennsylvania, New York, Connecticut and Maryland 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 an MSO that works 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 maintain a dominant market share of the high growth Florida medical marijuana industry. Furthermore, Zuanic says Trulieve features a substantial alternative to grow the businesses of its in some 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 sixty dolars price target for TCNNF stock.
GW Pharmaceuticals (GWPH)
In contrast to the other cannabis stocks on this list, GW Pharmaceuticals is a biopharmaceutical business 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 states GW’s third quarter Epidiolex sales exceeded his expectations. He also sees assorted bullish catalysts for GW through the end of 2021, which includes further penetration into more rollout and adult patients in Europe. Cantor has an “overweight” rating and $165 price target for GWPH stock.