The U.S. cannabis stocks on our list have operations that span across multiple legal cannabis states yet appear to be overlooked by investors
SmallCapPower | June 6, 2019: MSOs, or multi-state operators, are cannabis companies that span across multiple legal cannabis states in the U.S. Generally, these entities are structured as holdings companies with separate state subsidiaries that hold state licenses for seed-to-sale activities. Although these companies are not permitted to bring cannabis and cannabis-derived products across state lines, MSOs can share intellectual property, equipment, branding, and employees across state boundaries. With U.S. cannabis regulations expected to loosen over time, operating in multiple states can be advantageous in achieving rapid growth. Today we have identified four potentially overlooked U.S. cannabis stocks (MSOs) with a strong footprint. Cannex Capital (CSE:CNNX), iAnthus Capital (CSE:IAN), Nabis Holdings (CSE:NAB), and Columbia Care (NEO:CCHW).
*Share prices as at close June 4, 2019, data obtained from S&P Capital IQ
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iAnthus Capital Holdings Inc. (CSE:IAN) – $5.28
Cannabis
iAnthus Capital is a vertically-integrated MSO that has cultivation, processing, and owns dispensaries in the U.S. As of May 2019, IAN operates 21 dispensaries throughout 11 states, and owns a total of 68 retail licenses. In the U.S., there are more than 110 dispensaries with iAnthus-branded products, and over 1,000 stores with the Company’s CBD-branded products. On May 30, iAnthus reported its first-quarter 2019 financial results. These results featured revenue of $18.5M, up 22% from the prior quarter, and an adjusted EBITDA loss of $5.1M, comparatively better than the adjusted EBITDA loss of $6.5M a year earlier.
- Market Cap: $892.1 Million
- YTD Return: -9.7%
- Average 90 Day Trading Volume: 800,000
Cannex Capital Holdings Inc. (CSE:CNNX) – $1.37
Cannabis
Cannex Capital Holdings leases real estate properties and sells supplies to cannabis cultivators, processors, and dispensaries in the United States & Canada. The Company is focused on premium indoor cultivation, extraction, manufacturing, and branding of flower, edible, and derivative products. CNNX is based in Vancouver, BC, and is managed by a team of experienced industry and capital markets experts who are committed to aggressive, cost-effective growth. With the acquisition of 4Front Holdings, Cannex now has cultivation and processing licenses in Washington, Illinois, Michigan, California, Massachusetts, and Arizona. CNNX now also has retail licenses in Illinois, Michigan, Massachusetts, Maryland, Pennsylvania, and Arizona.
- Market Cap: $255.0 Million
- YTD Return: 44.2%
- Average 90 Day Trading Volume: 310,000
Nabis Holdings Inc. (CSE:NAB) – $0.65
Cannabis
Nabis Holdings is a Canadian investment company focused on strategically acquiring high-quality, cash-flowing assets across multiple aspects of the cannabis sector, primarily in the U.S. The Company looks to target U.S. LPs with a roadmap to expand globally, and puts a focus on strategic revenue generation, EBITDA, and growth. According to its Q2 2019 investor presentation, Nabis currently has investments in Michigan (7 Dispensaries, 1 Cultivation Facility, 1 Processing Facility), Arizona (1 Cultivation Facility, 1 Greenhouse, 1 Dispensary), and Washington (1 Processing Facility).
- Market Cap: $62.1 Million
- YTD Return: 62.5%
- Average 90 Day Trading Volume: 480,000
Columbia Care Inc. (NEO:CCHW) – $7.20
Cannabis
Columbia Care is a vertically-integrated manufacturer and marketer of medical cannabis products. Columbia Care also operates medical cannabis dispensaries throughout the United States. Currently, the Company is the only major licensed U.S. operator that has all the necessary approvals to operate in the EU. Columbia Care currently has 35 licenses in 15 jurisdictions, which includes 14 different states in the U.S. On May 24, Columbia Care announced the initiation of a collaborative study examining the therapeutic effectiveness and safety of medical cannabis as a pain reliever in patients with arthritis.
- Market Cap: $1.5 Billion
- 60-Day Return: -37.8%
- Average 90 Day Trading Volume: 118,000
Ubika Research/SmallCapPower has received compensation from 4Front Ventures Corp. to provide analyst research coverage. For full disclosure please visit here >>
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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