As the second week of trading begins many marijuana stocks in the US are showing some upside in the market. In 2021 the cannabis industry has seen significant changes and advances this year. Currently in the US 38 states and Washington DC currently have medical cannabis programs established. On the state level, the cannabis industry is expanding across the US rapidly giving marijuana companies a chance to grow with the market. As it stands many companies have used M&As as a form of quickly growing their footprint in the market.
This has created some larger cannabis companies that have the size to dominate the market. In general, this could add significant increases in revenue growth for some of these top marijuana companies. In essence, this market trend can be seen in both Canadian companies and US companies. But recently more US companies have been moving towards M&As changing the landscape of the top marijuana stocks to watch right now.
Already this year many cannabis stocks have reached new highs in February but are now trading at much lower levels from their peak. Realistically speaking, Current price levels could be a good opportunity for investors to start new positions. But before making an investment there are a few important things to consider. For one the best cannabis stocks to invest in are known for having extreme market volatility historically.Understanding The Cannabis Sector Before Investing
Because of this market volatility, many investors prefer to use short-term trading methods when trading top-pot stocks. At the present time, many day traders and swing traders capitalize on the cannabis sector’s constant market fluctuations. On the other hand, many analysts believe there are also long-term opportunities in leading marijuana stocks. Some vertically integrated cannabis MSOs have shown substantial stability and continue to produce strong earnings.
When it comes to buying marijuana stocks it’s always important to do your own due diligence before starting a position. Researching a company’s earnings and watching how the stock performs in the market can help you achieve better results when investing. With this in mind, we can look at some cannabis stocks for your watchlist this week. These 2 cannabis companies have developed their own unique business models and are seeing success in different markets.
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Trulieve Cannabis Corp. was already had more than 50% of the market share in Florida but a major acquisition of Harvest Health & Recreation Inc. (OTC: HRVSF) has given it a much larger footprint. Arizona-based Harvest has the largest presence in its home state. The two companies combined now have a consensus 2021 revenue of $1.2 billion. With this acquisition, Trulieve will claim the top spot for the largest revenue-producing company in the cannabis industry globally.
In the agreement, Trulieve will give Harvest shareholders 0.1170 of a TCNNF stock. In total Trulieve will pay a total consideration of about $2.1 billion based on the May 7th closing price. Generally speaking, the two company’s combined will now have operations in 11 states with a total of 126 dispensaries to serve the medicinal and recreational markets. Additionally, with a combined adjusted EBITDA of $266 million and a 2021 consensus adjusted EBITDA of $461 million they could be the most profitable MSO in America. In reality, this new development has made one of the largest cannabis companies in the world.
TCNNF stock is up 29.41% year to date trading at $38.40 in the last trading hour of May 10th. With a high of $53.73 in February TCNNF stock has dropped 4.62% in the last month. According to analysts at Tip Ranks TCNNF stock has a 12-month average price target of $68.31 per share. This would represent an increase of 76.06% from current levels. For this reason, TCNNF stock could be one of the best marijuana stocks to invest in for 2021.Planet 13 Holdings Inc.
No other cannabis companies have established a more recognizable brand than Planet 13 Holdings Inc. As one of the largest cannabis dispensary models in the world, its Superstore is a cannabis signature on the Las Vegas Strip. In April Planet 13 announced full-year 2020 results and first quarter 2021 revenue. In detail, the company produced Q1 2021 revenue of $23.8 million which include $9.7 million in March. Additionally, Planet 13 produced a 2020 total revenue of $70.5 million. Although the company produced revenue gains it is reporting a net loss of $7.9 million which increased from the $6.7 million the year prior.
In March Planet 13 announced a partnership with Curaleaf Select to open a select shop in shop in the Superstore. With this partnership, the #1 American cannabis oil brand will be made available in the largest Las Vegas dispensary the Superstore. Recently on 4/20 Planet 13 crushed its single-day sales record generating $543,000 with gross margins exceeding 50%. For the month of April, the company has set a one-month record of $10.7 million almost equal to last year’s total Q2 revenue of $10.8 million.
PLNFH stock is up 19.75% year to date with a high of $8.67 in February. Closing at $6.40 on May 10th the stock is down 5.77% in the last month. According to analysts at PLNHF stock has a consensus price target of $6.50 per share. Currently, this analysis is only a 1.562% gain from current levels. With this in mind, PLNHF stock could be good to watch for a lower entry point to start a position.