The Canada-listed cannabis stocks we’ve picked have the largest upside potential based on analyst target prices
SmallCapPower | October 30, 2019: Despite the steep marijuana sector selloff so far in 2019, Bay Street and Wall Street analysts are still bullish on the prospects for certain cannabis stocks. Today we have weeded out four Canada-listed cannabis stocks with the largest upside potential based on analyst target prices.
*Share prices at October 28, 2019, data obtained from S&P Capital IQ
4Front Ventures Corp. (CSE:FFNT) – $0.60
Cannabis
4Front Ventures is a MSO that owns, operates or manages six cultivation and production facilities and 11 retail facilities across eight states. FFNT has developed two >50,000 square-foot indoor cultivation facilities in Washington with yields of more than 300 g/sq. ft. In Washington, 4Front operates one of the largest cannabis product manufacturing facilities in the world, where it produces some of its top-selling brands of flower, edibles, and oil-based products. The Company is focused on premium indoor cultivation, extraction, manufacturing, and branding of flower, edible, and derivative products. 4Front has cultivation and processing licenses in Washington, Illinois, Michigan, California, Massachusetts, and Arizona, and now also has retail licenses in Illinois, Michigan, Massachusetts, Maryland, Pennsylvania, and Arizona.
- Market Cap: $316M
- 7 Day Return: 5%
- 30 Day Return: -14%
- 2020 EV/Sales: 1.1x
- # of Analyst’s Covering: 3
- Average Target: $3.75
- Implied Return: 525%
PharmaCielo Ltd. (TSXV:PCLO) – $2.91
Cannabis
PharmaCielo is a Canada-based cannabis company focused on processing medicinal cannabis oil extract and related products in Colombia. The Company currently has 139 hectares of total cultivation capacity and expects to complete the construction of its 24,757 sq. ft. GMP2 certified Research and Technology production and processing facility by the end of Q2/19. On January 19, the Company began trading on the TSX Venture Exchange. On September 25, PCLO announced it signed a U.S. sales agreement with an established multi-state distributor, General Extract LLC. Introductory revenues under the contract have guided towards 2019 revenue of $3M.
- Market Cap: $328M
- 7 Day Return: -26%
- 30 Day Return: -43%
- 2020 EV/Sales: 3.3x
- # of Analyst’s Covering: 2
- Average Target: $11.25
- Implied Return: 287%
Harvest Health & Recreation Inc. (CSE:HARV) – $3.54
Cannabis
Harvest Health & Recreation is a multi-state operator (MSO) with rights to more than 210 facilities, of which ~130 are retail locations, and more than 1,700 employees across 18 states and territories. The Company believes that its vertical approach to design, construction, and implementation should result in low production costs. As of June 30, 2019, Harvest Health operated 16 dispensaries, compared with 13 during the quarter ended March 31, 2019. On August 15, 2019, Harvest reported Q2/19 financial results. Net loss was $20.6M on revenue of $26.6M, and the adjusted EBITDA loss was 2.2M, a 47% decrease from the previous quarter.
- Market Cap: $1,005M
- 7 Day Return: -6%
- 30 Day Return: -23%
- 2020 EV/Sales: 1.0x
- # of Analyst’s Covering: 7
- Average Target: $18.93
- Implied Return: 435%
Village Farms International Inc. (TSX:VFF) – $10.89
Cannabis
Village Farms International is a vertically-integrated greenhouse grower in North America. The Company use hydroponic growing methods in glass-enclosed facilities to grow its premium-quality products. Currently, the Company has six greenhouses that cover a total of 9.2M sq.ft. As well, the Company has entered into the cannabis space with its joint ventures (JV) with Emerald Health Therapeutics and Nature Crisp LLC to create “Pure Sunfarms Corporation” and “Village Fields Hemp USA LLC,” respectively. On August 12, 2019, the Company reported Q2/19 financial results, highlighted by a 125% increase in sales of dried cannabis to $32.4M when compared to Q2/18. On October 22, VFF completed its $28M bought deal at $9.40/share.
- Market Cap: $572M
- 7 Day Return: 15%
- 30 Day Return: -8%
- 2020 EV/Sales: 2.0x
- # of Analyst’s Covering: 5
- Average Target: $35.79
- Implied Return: 229%
4Front Ventures Corp. (previously Cannex Capital Holdings CSE:CNNX) is a featured sponsored company and has paid SmallCapPower.com a fee for coverage.