HomeMarket NewsHigh Hopes: A Second Look at 3 Cannabis Stocks After the Bubble...

High Hopes: A Second Look at 3 Cannabis Stocks After the Bubble Burst

Actionable Trade Ideas

always free

The cannabis sector, though speculative, has experienced a tumultuous boom-bust cycle in recent years. As the sector languishes in the β€œbust” category, many growth investors are hesitant. The question looms large – will the cannabis industry stage a return from the ashes? Furthermore, what factors could potentially spark a sector-wide resurgence?

Trulieve Cannabis Corp (TCNNF)

Florida licensed medical marijuana cannabis provider Trulieve

Source: Leigh Trail / Shutterstock.com

Trulieve Cannabis Corp. (OTCMKTS: TCNNF) has emerged as a leading player in the cannabis realm. The company has recently restructured its executive team, with the appointment of Wes Getman as CFO. Known for producing Avenue and Modern Flower cannabis products, Trulieve distributes these offerings across several states.

Despite entering overbought territory, Trulieve Cannabis Corp. garners strong support from bullish investors. The company’s robust long-term outlook, bolstered by better-than-expected earnings and positive cash flow, makes a compelling case for investment. Acting CEO Kim Rivers maintains a steadfast focus on long-term growth and aims to capture significant market share in the potential event of federal legalization.

While a significant macro catalyst may be necessary for TCNNF stock to witness a substantial upswing, the stock has piqued my interest due to its strong current positioning.

Cresco Labs (CRLBF)

cannabis stocks, With America Turning Green Things Only Can Get Better for Aurora Stock

Source: Shutterstock

Cresco Labs (OTCMKTS: CRLBF) stands out as a prominent U.S. cannabis producer. With its business model encompassing production, retail, and cultivation facilities across 10 states, the company adopts a vertically-integrated approach, with 68 dispensaries buttressing its operations, despite enduring financial losses. Analysts foresee a turnaround, anticipating a negative 13 cents EPS for fiscal year 2024.

Further, Cresco Labs ventured into the THC-infused wing sauce, in partnership with The Fifty/50 sports bar. Sold at Chicagoland dispensaries during the Super Bowl, the product, manufactured at Cresco’s Joliet facility, aimed to normalize cannabis consumption. Despite possessing automated production capabilities for prerolls, vapes, and gummies, the company chose to handcraft this limited-time specialty product. The overwhelming demand led to a rapid sell-out within 15 minutes. The subsequent decision to produce more for Sunnyside dispensaries at $30 per jar marks a significant success for the company.

While Cresco continues to operate at a deficit and witnessed a year-over-year (YOY) revenue decline, analysts maintain an optimistic outlook, providing a price target of $3.32 and rating the stock as a strong buy, with 9 out of 13 analysts echoing this sentiment.

Cannabist Company Holdings Inc. (CBSTF)

The Green Frontier: Cannabist Company Holdings Inc. Reports Q4 Earnings

Joint Expansion in the East Coast

As dawn broke over the U.S. markets on March 13, 2024, the air was already abuzz with whispers of Cannabist Company Holdings Inc. (OTCMKTS:CBSTF) making their Q4 and full-year 2023 financial results public. An 8:00 a.m EST conference call was scheduled for the company’s management to delve into the results, a much-anticipated event stirring up the pot, so to speak.

New Leadership and Growth Opportunities

A noteworthy highlight of the period was CMSTF joining forces with Revelry Herb Co., a move designed to bring the bliss of pre-roll joints to New Jersey, Massachusetts, and Pennsylvania. Revelry’s East Coast debut carries the scent of potential future collaborations in the air, hinting at a budding marriage of key lifestyle products, including the tantalizing promise of smell-proof backpacks. What could perhaps be perceived as an unexpected commercial romance heightened anticipation and speculation for cannabis enthusiasts and investors alike.

Furthermore, the torch of company leadership has been passed to Jesse Channon, the former Chief Commercial Officer, who now wears the mantle of company president. Channon’s expertise in transformative technologies and digital marketing platforms will undoubtedly accelerate the company’s trajectory and widen its horizons. For investors contemplating a company that is shaking up its C-Suite and directing its focus toward long-term growth prospects, this puts forward a speculative opportunity that may warrant consideration at its current valuation.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Guided by a passion for investing, Chris MacDonald pursued an MBA in Finance, amassing over 15 years of experience in management roles in corporate finance and venture capital. His background as a financial analyst, coupled with his enthusiasm for uncovering undervalued growth opportunities, shapes his conservative, long-term investing outlook.

Swing Trading Ideas and Market Commentary

Need some new swing ideas? Get free weekly swing ideas and market commentary from Jonathan Bernstein here: Swing Trading.

Explore More

Weekly In-Depth Market Analysis and Actionable Trade Ideas

Get institutional-level analysis and trade ideas to take your trading to the next level, sign up for free and become apart of the community.