The four Canada-listed cannabis stocks we’ve dug up have either completed significant financings or been given access to capital
SmallCapPower | October 23, 2019: Investor interest in the cannabis sector has cooled dramatically, making it much more difficult for these companies to raise capital. Today, we have identified four Canada-listed cannabis stocks that have either completed significant recent financings or have been given access to credit, which should be advantageous in not only surviving but possible thriving in this current environment.
*Share price data as at October 21, 2019, data obtained from S&P Capital IQ
iAnthus Capital Holdings Inc. (CSE:IAN) – $2.30
iAnthus Capital is a vertically-integrated MSO with cultivation, processing, and retail operations in the U.S. According to the Company’s July investor presentation, IAN operates 23 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 September 30, the Company announced a $100M financing plan to build out its existing markets. Of note, Green Gotham Partners invested an additional $20M via the purchase of senior secured convertible notes. Additionally, on October 17, IAN announced the nomination of five new independent directors.
- Market Cap: $395M
- 7-Day Return: +46%
- 30-Day Return: -18%
- YTD-Return: -58%
- 2020 EV/Sales Multiple: 1.4x
TerrAscend Corp. (CSE:TER) – $4.85
TerrAscend is a company that serves the medical cannabis market through its subsidiaries. These include Solace Health, a licensed producer of medical cannabis, TerraHealth Network, a clinical support and educational platform, and SolaceRx, delivering innovative and specialized pharmaceutical products for healthcare professionals with the goal of addressing unmet medical needs. On October 2, TER announced a US$25M private placement – the first tranche had a lead order from Canopy Rivers for US$10M and was already completed.
- Market Cap: $600M
- 7-Day Return: 10%
- 30-Day Return: -19%
- YTD-Return: -17%
- 2020 EV/Sales Multiple: 1.8x
Green Growth Brands Inc. (CSE:GGB) – $1.59
Green Growth Brands runs a vertically-integrated cannabis facility that is located in Las Vegas, Nevada. Green Growth distributes products through mall-based shops, partnerships with traditional retailers and e-commerce platforms. Currently, the Company has had successful retail strategies with large specialty retail companies, such as Bath & Body Works, Designers Shoe Warehouse and L Brands. These partnerships will be used in the creation of products for the Company’s Seventh Sense branded retail stores. On August 8, the Company announced that it had opened its 100th Seventh Sense Botanical Therapy mall-based retail shop. GGB also recently closed a $50.3M financing, which will be used to fund acquisitions, capex, and general corporate purposes.
- Market Cap: $328M
- 7-Day Return: +4%
- 30-Day Return: +3%
- YTD-Return: -66%
- 2020 EV/Sales Multiple: 1.1x
MedMen Enterprises Inc. (CSE:MMEN) – $1.42
MedMen Enterprises operates as a medical and recreational cannabis cultivator, producer, and retailer in the U.S. MedMen is licensed for 9 States, 70 retail stores, and 12 factories. MedMen operates Seven Point Powered by MedMen, a cannabis dispensary located within Chicago, Illinois. On July 10, MMEN announced a binding term sheet for up to US$250M in debt from a senior secured convertible credit facility led by Gotham Green Partners. The stock is down 61% since the announcement.
- Market Cap: $754M
- 7-Day Return: -10%
- 30-Day Return: -37%
- YTD-Return: -63%
- 2020 EV/Sales Multiple: 2.4x
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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