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The Green Rush: Cannabis Companies Poised to Dominate Germany’s Lucrative Market

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In the aftermath of Germany’s landmark decision to legalize cannabis possession, the stock market experienced a seismic jolt, propelling cannabis stocks to new heights before settling back down. This move comes on the heels of Germany, the largest European country, opening its doors to the green revolution.

Leading the charge post-legalization are industry titans such as Curaleaf Holdings CURLF, the foremost U.S. cannabis company by market cap, along with Trulieve Cannabis Corp. TCNNF, Green Thumb Industries GTBIF, and Cresco Labs CRLBF.

TilrayΒ TLRY and Aurora CannabisΒ (NASDAQ:Β ACB), key Canadian players supplying Germany’s medical marijuana sector, experienced mixed market performance, but the winds of change are blowing in their favor.

So, Why the Fuss?

Renowned analyst Pablo Zuanic emphasized the untapped potential within Germany’s medical cannabis landscape. Despite the relative scarcity of medical marijuana patients currently in Germany, the new regulations herald a significant growth trajectory. Zuanic highlighted Canadian powerhouses, Tilray and Aurora, as best positioned to capitalize, having already established themselves as major players in the German market.

Florida Sets the Stage

Drawing parallels with Florida, where over 3.5% of the population uses medical cannabis, Zuanic painted a vivid picture. Imagine if merely 1% of Germans follow suit! The German market could skyrocket to a staggering €1.7 billion ($1.84 billion) by 2025 – a tenfold increase from its current size.

β€œTilray boasts primacy in the reimbursed German MMJ market, while Aurora takes the lead in the cash market,” affirmed Zuanic, senior analyst at Zuanic & Associates.

Zuanic also highlighted the impending boon for smaller Canadian producers exporting to Germany, as well as other enterprises engaged in smaller-scale exports to the region.

Furthermore, High Tide Inc. HITI eagerly embraced Germany’s legalization stride, illustrating the global allure of the cannabis market.

β€œWe are thrilled about the prospects of introducing our groundbreaking discount club model to Germany, a heavyweight in the world economy with a populace exceeding 83 million,” expressed Raj Grover, founder, and CEO of High Tide.

Anticipating Cannabis Earnings Amid Germany’s Legalization March

As the curtain rises on the 4th Quarter cannabis earnings season this week, all eyes are on the 12 largest multi-state operators (MSOs). Viridian Capital offers insights into the expected performance metrics, providing a compass for investors amidst this dynamic landscape.

Viridian Capital’s projections delineate the anticipated growth trends, from EBITDA increases in the fourth quarter of 2022 to 2023 and beyond. This roadmap provides a valuable benchmark for assessing the evolving cannabis sector.

Image: Geralt and Kindel Media by Pixabay28

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