3 U.S. Marijuana Stocks to Watch
After a rocky finish in 2018, cannabis stocks have rallied higher in 2019. Some more than others. While the biggest marijuana stocks in Canada are hogging all the limelight, there are a number of U.S. cannabis stocks that have been performing very well in 2019.
Curaleaf Holdings Inc (OTCMKTS:CURLF, CNSX:CURA) is up more than 105%, Green Thumb Industries Inc (OTCMKTS:GTBIF, CNSX:GTII) has advanced 82%, while the oft-overlooked iAnthus Capital Holdings Inc (OTCMKTS:ITHUF, CNSX:IAN) stock has climbed 16.8%.
All three U.S. cannabis stocks are worth keeping on your radar in 2019 and 2020.
Curaleaf Holdings Inc
Curaleaf Holdings is an integrated medical and wellness cannabis company that cultivates, processes, markets, and dispenses a range of cannabis products, including flower, capsules, lozenges, dry-herb vaporizer cartridges, pre-rolls, tinctures, and edibles. (Source: “Investor Presentation February 2019,” Curaleaf Holdings Inc, last accessed May 1, 2019.)
The Wakefield, Massachusetts-based company has a presence in 12 states. It owns and operates 43 dispensaries, 12 cultivation sites, and 11 processing sites.
Curaleaf’s 12 cultivation sites cover approximately 650,000 square feet, with a current production capacity of 63,000 pounds of dry flower. By 2020, the company expects its cultivation capacity to increase to more than one million square feet, producing over 290,000 pounds of dry flower.
It is focusing on highly populated states with limited licenses, including Florida, Massachusetts, New Jersey, and New York.
Curaleaf has the largest footprint of branded retails stores in the U.S., covering roughly 70% of the U.S. cannabis market.
Curaleaf Holdings Inc Stock
| Curaleaf Stock Information | |
| Market Cap | $4.6 billion |
| 52-Week High | $11.45 |
| 52-Week Low | $3.88 |
| Shares Outstanding | 11.8 Million |
| Float | 185.6 Million |
| 50-Day Moving Average | $9.12 |
| 200-Day Moving Average | $7.10 |
(Source: “Curaleaf Holdings, Inc. (CURLF),” Yahoo! Finance, last accessed May 1, 2019.)
Curaleaf stock has been bullish for much of 2019. On April 23, the company’s share price hit an intra-day high of $11.45, representing a then year-to-date gain of 143.6%.
CURLF stock gave up some short-term ground to profit-taking and is trading at $9.80 at the time of this writing, a 108.5% increase since the start of January.
Chart courtesy of StockCharts.com
Curaleaf Q4 Revenue Up 408%, 2018 Revenue Increases 298%
Part of Curaleaf’s success in 2019 can be attributed to its strong fourth-quarter and year-end results.
The company announced on March 20 that its fourth-quarter revenue increased 408% year-over-year and 49% sequentially to $32.0 million. (Source: “Curaleaf Reports Fourth Quarter and Full Year 2018 Financial and Operational Results,” Curaleaf Holdings Inc, March 20, 2019.)
The company’s fourth-quarter managed revenue (which excludes the impact of pending acquisitions) was up 302% year-over-year and up 49% sequentially at $34.9 million.
Curaleaf reported a Q4 net loss of $16.5 million ($0.04 per share) compared to a net income of $628,000 (breakeven per share) in the fourth quarter of 2017. The net loss is attributed to a $4.2-million one-time charge associated with the reverse takeover and acquisition and finances related expenses.
Full-year revenue was up 298% year-over-year at $77.1 million. Full-year managed revenue was up 209% at $87.8 million, versus $28.4 million in 2017.
Curaleaf attributes its strong sales to organic growth in Florida, the opening of three dispensaries in New York, an acquisition in Massachusetts in March, and an acquisition in Arizona in April.
Curaleaf reported a full-year net loss of $61.8 million ($0.16 per share) compared to a 2017 net loss of $2.8 million ($0.01 per share).
For 2019, Curaleaf reaffirmed its full-year 2019 outlook for managed revenue of $400.0 million and free cash flow of $100.0 million.
Green Thumb Industries Inc
Chicago-based Green Thumb Industries cultivates, produces, and dispenses cannabis in the United States. The company’s branded products include edibles, topics, flower, and concentrates. Green Thumb Industries also owns and operates a growing chain of national retail cannabis stores called Rise. (Source: “About Green Thumb Industries,” Green Thumb Industries Inc, last accessed May 1, 2019.)
The company operates 13 manufacturing facilities, has licenses for 77 retail locations, and has operations across 12 states, including California, Colorado, Florida, Nevada, New York, Ohio, and Pennsylvania.
In the first quarter of 2019, Green Thumb Industries entered Florida, opening a Rise dispensary in Deerfield Beach, its 15th store nationwide. During the second quarter, Green Thumb opened its second retail location in Florida. It expects to open 15 to 20 new stores this year.
Green Thumb Industries Inc Stock
| Green Thumb Stock Information | |
| Market Cap | $3.0 billion |
| 52-Week High | $25.03 |
| 52-Week Low | $6.44 |
| Shares Outstanding | 145.1 Million |
| Float | 57.9 Million |
| 50-Day Moving Average | $14.79 |
| 200-Day Moving Average | $12.75 |
(Source: “Green Thumb Industries Inc. (GTBIF),” Yahoo! Finance, last accessed April 30, 2019.)
Green Thumb Industries’ share price has been bullish since the start of the year, taking full advantage of the January effect. Strong fourth-quarter and year-end results have helped the company maintain this momentum.
Trading at $14.74 at the time of this writing, Green Thumb’s share price is up 82% year-to-date.
Chart courtesy of StockCharts.com
Green Thumb Q4 Revenue Up 237%, 2018 Revenue up 278%
On April 9, Green Thumb Industries announced that fourth-quarter revenue advanced 237% year-over-year and 21% sequentially to $20.8 million. (Source: “Green Thumb Industries (GTI) Announces Full Year 2018 Revenue of $62.5 Million, 278% Year-Over-Year Growth,” Green Thumb Industries Inc, April 9, 2019.)
Green Thumb Industries reported a Q4 net loss of $3.1 million ($0.02 per share) versus a net loss of $2.4 million in the year-ago period.
Earnings before interest, tax, depreciation, and amortization (EBITDA) was $4.8 million, compared to a loss of $2.0 million in Q4 2017. Adjusted EBITDA was $12.4 million.
Full-year 2018 revenue was up 278%, at $62.5 million. The company reported a net loss for 2018 of $7.7 million, versus a loss of $3.7 million in 2017. EBIDTA was $27.7 million, compared to an EBITDA loss of $3.0 million in 2017.
Green Thumb Industries Founder and CEO Ben Kovler said the following:
2018 was a momentous year for GTI. In just six months following our RTO in June and in the beginning of 2019, we have expanded the infrastructure for our consumer products and retail businesses to now include 13 production facilities and the ability to open 88 retail locations across 12 states including pending acquisitions.
(Source: Ibid.)
iAnthus Capital Holdings Inc
Last on our list of U.S. cannabis stocks to watch is iAnthus Capital Holdings Inc. The New York-based company owns and operates a network of licensed cannabis cultivation, processing, and dispensary facilities in the U.S. It is in the process of consolidating a large number of cannabis operations and investments in 11 U.S. states.
iAnthus’ investments in Massachusetts, New York, Florida, Nevada, Arizona, and California all exist in markets with large populations and limited licenses. (Source: “Investors,” iAnthus Captial Holdings Inc, last accessed May 1, 2019.)
In Florida, the company is building the largest grow-op in the state, at over 160,000 square feet.
In October 2018, iAnthus announced it was acquiring MPX Bioecutical Corp (OTCMKTS:MPXEF, CNSX:MPX) in an all-share transaction valued at CA$835 million. It was the largest public cannabis transaction in the U.S. at the time.
The merger will result in iAnthus having a significantly expanded footprint, with operations in 11 states, spanning both the east and west coast. After the merger, it will have licenses to operate 63 retail location and over 500,000 square feet of cultivation and processing space in the U.S.
iAnthus Capital Holdings Inc Stock
| iAnthus Stock Information | |
| Market Cap | $744.7 million |
| Beta | 1.3 |
| 52-Week Change | 44.1% |
| 52-Week High | $7.27 |
| 52-Week Low | $3.17 |
| Shares Outstanding | 74.2 Million |
| Float | 65.1 Million |
| 50-Day Moving Average | $5.29 |
| 200-Day Moving Average | $5.02 |
(Source: “iAnthus Capital Holdings, Inc. (ITHUF),” Yahoo! Finance, last accessed May 1, 2019.)
iAnthus stock has been on a bit of a roller coaster ride this year, much like the broader market. While the company’s share price hasn’t been on a tear like many of its peers, it is keeping pace with the broader market.
One of the main reasons why ITHUF stock hasn’t been on fire in 2019 is that it is often overlooked by cannabis investors. The company reported strong fourth-quarter and full-year revenue growth, but its numbers are not as impressive as those of other companies.
That said, with its merger, the opening of eight new dispensaries, and its plans to nearly double that pace throughout the remainder of 2019, Anthus stock should gain traction in the second half of the year.
Chart courtesy of StockCharts.com
iAnthus Q4 Revenue Increased 165%, 2018 Revenue Advanced 88%
On April 2, iAnthus announced that fourth-quarter revenue increased 165% year-over-year to $2.2 million. The company reported a Q4 net loss of $15.9 million, which includes $9.9 million of non-cash charges used to derive adjusted EBITDA. (Source: “iAnthus Reports Fiscal Fourth Quarter and Full Year Unaudited 2018 Financial Results,” iAnthus Captial Holdings, Inc, April 2, 2019.)
Full-year revenue increased 88% year-over-year to $4.5 million. iAnthus reported a full-year net loss of roughly $62.0 million, including $44.1 million of non-cash charges used to derive adjusted EBITDA.
The company’s current cash balance is approximately $45.0 million. iAnthus also has the potential to receive over $125.0 million from the exercise of warrants it has issued.
CEO Hadley Ford commented:
We are now revenue generating in nine of eleven states and ramping quickly. With the foundation we have built in 2018, both organically and through the acquisition of MPX, iAnthus is poised for a transformative 2019.
(Source: Ibid.)
Analyst Take
Canadian cannabis stocks hog much of the limelight, but the fact is that there are many excellent U.S. cannabis stocks with great operations and momentum.
Some U.S. cannabis stocks are trading at steep discounts compared to Canada’s top marijuana companies. Of those, Curaleaf Holdings Inc, Green Thumb Industries Inc, and iAnthus Capital Holdings Inc are three worthy U.S. cannabis stocks worth keeping an eye on.
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