The election results are actually bullish for marijuana stocks.
Cannabis stock investors didn’t get the blue wave they were hoping for in the U.S. election, but just five status marijuana legalization procedures on the ballot have passed. Recreational 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 perhaps MSOs. Unfortunately for cannabis investors, Democrats may not gain control of the Senate, possibly restricting significant federal cannabis reform. As a result, some cannabis stocks initially dropped following the election. Allow me to share the best cannabis stocks to buy following the election, as reported by Cantor Fitzgerald.
Flower price depreciation has been a big problem for almost all Canadian licensed producers, or maybe LPs. However, analyst Pablo Zuanic says Canadian LPs as Aphria could have “positive collateral benefits” from the U.S. election, assuming Joe Biden takes more than the White House. Federal legalization may still be at least two years away, but decriminalization of adult-use marijuana and potential federal rescheduling of cannabis can boost Aphria and other Canadian LPs, Zuanic states. He states Aphria has multiple positive catalysts in front in the near term, including an increase of 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 says OrganiGram’s retail sales trends in the third quarter had been relatively strong in comparison with various other Canadian LPs. Nonetheless, Hifyre cannabis sales information for October suggest OrganiGram sales were down 25 % 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, but Zuanic is hopeful the business will see its way to earnings and growth in the long run. 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 thriving. In the next quarter, Cresco beat consensus analyst sales estimates by 30 % and exceeded the earnings of theirs before interest, taxes, depreciation and amortization expectations by nearly 200 %. Zuanic says Cresco’s 42 % sequential sales progress in the second quarter was the best growth rate with almost all of Cresco’s large MSO peers. Zuanic says the Illinois market is going to be a leading near-term growth driver for Cresco, and the Origin House acquisition of its should supplement the organic growth of its. Cantor Fitzgerald has an “overweight” rating and $16 cost target for CRLBF inventory.
Curaleaf is a U.S. MSO which works in twenty three states. Among those states is New Jersey, that might represent probably the largest opportunity with the states which legalized recreational marijuana on Election Day. Not merely will Curaleaf benefit from the brand new Jersey sector, but Zuanic says Curaleaf may draw clients from neighboring Pennsylvania and New York. Curaleaf noted astounding 142 % revenue growth and 180 % gross earnings growth year over year in the second quarter and also holds a leadership position in key states. Cantor Fitzgerald has an “overweight” rating and $18 price target for CURLF inventory.
Green Thumb Industries (GTBIF)
Green Thumb Industries is a U.S. MSO which 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 its balance sheet, 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. Additionally, he anticipates further legalization in Pennsylvania, New York, Connecticut as well as Maryland in coming years. Cantor Fitzgerald has an “overweight” rating and $29 cost target for GTBIF inventory.
Trulieve Cannabis Corp. (TCNNF)
Trulieve Cannabis is an MSO that runs primarily in Florida. Zuanic recently hosted a call with Trulieve CEO Kim Rivers. After talking with Rivers, Zuanic says he’s comfortable in Trulieve’s ability to maintain a dominant market share of the high growth Florida medical marijuana industry. Moreover, Zuanic says Trulieve has a significant chance to produce the companies of its in other states, including California, Massachusetts and Connecticut. Finally, he’s optimistic Florida voters could 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)
Unlike the other cannabis stocks on this list, GW Pharmaceuticals is actually a biopharmaceutical company focused on developing 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 says GW’s third-quarter Epidiolex sales exceeded the expectations of his. He also sees several bullish catalysts for GW with the tail end of 2021, including further penetration into additional rollout and adult people in Europe. Cantor has an “overweight” rating and $165 price target for GWPH inventory.