2 cannabis stocks with strong buying and monster growth
Investors have been fixated on growth companies for the past year, and one segment that has been on the rise is the fledgling cannabis industry. The sector offers a unique proposition and the prospect of further growth as another important catalyst looms on the horizon that will completely transform the industry. As expected, a democratically-run Senate was good news for those looking to promote marijuana reforms at the federal level. And it looks like the expected changes may happen sooner than originally expected. With the support of Senate Majority Leader Chuck Schumer, the Democratic Senators have said they will push for marijuana legalization at the federal level and promise « a unified draft for comprehensive [cannabis] reform » in the first half of this year. The statement meets expectations that the majority in Democratic Congress will pass a law to legalize marijuana and sign President Biden. Investors are also considering further legalization measures at the state level. A key state in this regard is New York. So the cannabis industry is looking up. There is a growing network of state legalization regimes and the expectation of a change in federal policy. both are putting upward pressure on cannabis stocks. With that in mind, we used TipRanks’ database to find two cannabis stocks that were rated « Strong Buys » by analyst consensus. Both have achieved impressive results since the beginning of the year and will continue to grow in the coming year. Village Farms International (VFF) We’re starting with Village Farms International, a long-standing company in the niche farming business. The company started out as a farmer and produced high quality greenhouse vegetables for year round selling in the North American market. That background fitted well with the company for a transition into the cannabis industry – Village Farms has experience in greenhouse production and industrial cultivation. Village Farms’ shares exhibit a tremendous growth profile soaring 327% over the past 12 months – with a surge in the past few days. Two major news have accelerated the surge since late January. First, the company prepaid in full the $ 15 million debt it incurred during its November acquisition of cannabis grower Pure Sunfarms. Second, Village Farms increased its investment in Asian cannabinoid company Altum by 50% to maintain a 10% stake in the company. The move increases Village Farms’ international reach and ability to grow Altum stocks in the future. The company was able to fund these moves because it had a successful stock sale in January, launched an additional 10.8 million shares, and raised $ 135 million in new capital. In addition to its strong capital and expansion positions, Village Farms reported solid financial results. The company had revenue of $ 43 million for the third quarter of 20, up 12.5% year over year. Earnings per share were 1 cent per share, a reversal from the $ 0.10 loss in the year-ago quarter. Eric Des Lauriers, 5-Star Analyst, reports on Village Farms for Craig-Hallum: “Village Farms has clearly established itself as the leading cannabis producer in Canada with the # 1 brand share and industry leading profitability. Canadian cannabis sales rose 128% year-over-year from 2020 to October (last available) and the number of pharmacies will accelerate through 2021, adding R to VFF revenue The wind. « Regarding the US markets and VFF’s position in Canada’s larger neighbor, the analyst adds, » With 5.7 million SF greenhouses in TX, the company also has a real US option that is being sought after by investors GA elections are finally appreciated. The VFF has historically been undervalued relative to less profitable peers, but we expect stocks to continue rising … as the prospect of US reform increases later in the year. “To that end, Des Lauriers rates VFF with a buy and its price target of $ 25 et suggests the stock has room for ~ 26% upside in the coming year. (To see Des Lauriers’ track record, click here.) There are a total of 3 recent ratings of VFF stock and all of them are buys, giving the stock a consensus rating by analysts from Strong Buy and one on Wall Street there is general agreement about the strengths of the company. The stock is priced at $ 19.90, and the average target price of $ 24.33 implies an upward movement of ~ 23% for the year ahead. (See VFF stock analysis on TipRanks) TerrAscend Corporation (TRSSF) The next cannabis stock we look at, TerrAscend, is another major cannabis producer in the US, Canada, and Europe. Active in both the medical and the recreational side of the market, the company builds and manufactures cannabis and markets a range of products under numerous brand names. TerrAscend’s US operations are located in California, Pennsylvania, New Jersey and Utah. The company plans to expand as more states legalize cannabis. A strong indication of the strength of the cannabis industry, TRSSF stocks are up a sky-high 624% over the past 12 months. The growth was driven by the expansion of cultivation activities in California and P nsylvania and by entering the adult recreational market in New Jersey. Last month, TerrAscend completed an unmediated sale of private placement shares, bringing more than 18 million common shares to market. The sale price was $ 12.35 ($ 9.72) and the offering raised $ 224 million ($ 176.3 million). The majority of the proceeds – around 80% of the total proceeds – were generated by four large institutional investors based in the USA. The funds raised will be used to further expand the company’s cultivation (TRSSF plans to expand cultivation and production operations in New Jersey) as well as to fund mergers & amp; Acquisition activities. TerrAscend’s rapid growth and strong future prospects have drawn the attention of world-class analysts including 5-star analyst Eric Des Lauriers of Craig-Hallum (see above). « TerrAscend is a leading multi-state operator (MSO) in the US cannabis market with world-class management, assets and access to deal flow. We have been optimistic about the company since we began reporting last year and are excited to announce the TRSSF « The team exceeded our expectations and achieved a rapid increase in margins and operational leverage that have earned them a solid place in the top tier of MSOs, » said Des Lauriers. The analyst summarized: « [With] $ 280 million raised since the elections and federal reform, which is progressing faster than expected, we believe TRSSF deserves a peer reward. » Consistent with his bullish comments, Des Lauriers has a buy value on TRSSF stock with a target price of $ 20 that implies upside potential of ~ 31% over the next 12 months. We see another stock with broad support from Wall Street analysts ten on – the Strong Buy consensus rating is unanimous based on 7 most recent reviews. The shares sell for $ 15.30, and their recent appreciation has brought that price close to their average target price of $ 15.43. (See TRSSF stock analysis on TipRanks.) To find great ideas for trading cannabis stocks at attractive valuations, visit TipRanks ‘Best Stocks to Buy, a newly launched tool that brings together all of TipRanks’ stock insights. Disclaimer: The opinions expressed in this article are solely those of the presented analysts. The content is intended to be used for informational purposes only. It is very important that you do your own analysis before making any investment.