Comp Tables

Investment Analysis and Valuation of the Cannabis Industry

Your Comps Are Wrong: Why and How to Use Comp Tables - Click to Toggle

Why do we think comp tables are so important?

They are the key tool in understanding investment opportunities and risks in an industry.

And how can you manage a portfolio with wrong data?

  • provide a menu of available public investment choices for purchase or sale
  • show the range of valuations of the choices, showing discrepancies that may or may not converge in the future. Public valuations also inform private company valuations and acquisition pricing
  • show the size and leverage of the public options
  • show the range of operating margins and opportunities for margin expansion or compression
  • show the cost of capital for companies and the industry, which can be applied to similar companies in the private market either raising new capital or deciding whether to sell to another company
  • on the second page, the stock price performance shows what is moving up and down, helps isolate specific performance vs peers and the broader market

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Publicly Available Commentary

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EBITDA & Leverage – Higher Than You Think

As valuations and liquidity have declined since the first quarter 2021 (when the industry raised over $3 billion in equity), debt has become a go-to source of financing. What is the leverage in cannabis? It may be higher than you think. There are also debates on if...

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May Multiples & Key Questions

May Review of Multiples: The comp table has been updated for 1Q22 earnings and can be accessed by Premium Members in real time.May Review of Multiples: Since March 31, the US plant touching operators on my comp table have on average (using the sums...

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1Q22 Survey Results

It is important to note that 29% of the responses invest at least $5 million, and that 11% invest more than $100 million. We can safely disclose that the orange bars in the charts below represent institutional AUM measured in the billions of dollars.

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US Cannabis below SMidCap Crisis Trough Multiples

As the markets collapsed in March 2020, taking an already weak cannabis sector with it, I asked a simple question when working at MJBizDaily:“At what multiple did small-midcap consumer, industrial, agricultural, pharma, and tech equities bottom in the 1999-2003 Dotcom...

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Sardines & Sentiment

Cannabis stocks, like most stocks, are behaving like trading sardines. I’ll let page 18 of Seth Klarman’s Margin of Safety explain the parable: There is an old story about the market craze in sardine trading when the sardines disappeared from their traditional waters...

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EBIDA: EBITDA adjusted for 280E Taxes

In honor of MJBizCon and MJUnpacked in Vegas this week, we are providing the multiples from our dynamic in-the-money only comp table adjusted for all announced deals here.As always our Premium Members can download the full Premium comp table,...

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2Q21 Fundamentals Disconnected from Stock Moves

There is a disconnect between fundamental performance and stock performance for U.S. cannabis companies, resulting in compressing valuations for those operations. But multiples on 2022 are nearing past trough levels. Strong second quarter earnings have not yet driven...

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The CME & Cannabis? Valuation review into 2Q21

8th Revolution and the CME? In early June, we were interviewed by 8th Revolution’s Kellan Finney and Bryan Fields, where we discussed the California cultivation supply, sustainability and scalability of margins, Weedmap’s investment thesis and narrative, and Cresco...

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Uplisting to NASDAQ = +10-25X the Liquidity of OTC

Though access to capital for public cannabis companies improved in early 2021, liquidity remains low for the U.S. plant-touching operators in comparison to the Canadian licensed producers. U.S. operators have access only to lower-volume exchanges, such as the Canadian...

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Risk Off February? Comp Tables 2/26/2021

For the month of February cannabis stocks peaked then declined. The stocks ended up 17% for the US operators and 23% for the Canadian operators, and both groups have declined since peaking around February 8-10 (-13% for US and -26% for Canadian) - when we noted that...

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Comp Tables: Premium Members