CIBC World Markets analyst John Zamparo expects U.S. federal legalization of cannabis by the end of 2022. After increasing enterprise value-to-sales multiples “to reflect the recent upward movement in sentiment,” Mr. Zamparo also raised his targets for these stocks:
* Aphria Inc. (APHA-T, “outperformer”) to $28 from $18. Average: $15.70.
“While 18 times cannabis revenue is well above historical norms, we do not view it as unreasonable in the current environment for what we believe is Canada’s market share leader,” he said. “Additionally, upside potential exists purely from the implied price of the stock based on the pending deal with Tilray.”