Viridian Chart Of The Week: Finding The Right Balance Between Cheapness And Safety In Cannabis Stocks
Portfolio Pulse from Viridian Capital Advisors
The Viridian Chart of the Week analyzes the balance between valuation and credit risk in cannabis stocks post Q3 earnings. It uses EV/2024 Consensus EBITDA estimates and a proprietary Credit Risk Score to assess attractiveness. Green Thumb (GTBIF) ranks most attractive, while Cansortium (CNTMF) and AYR (AYRWF) offer a balance of low valuation and credit risk. Curaleaf (CURLF) and Acreage (ACRDF) appear less attractive due to high valuation multiples and poor credit scores, respectively. The Viridian Cannabis Deal Tracker monitors industry capital raises and M&A activity.
November 20, 2023 | 7:33 pm
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POSITIVE IMPACT
Cansortium's low EBITDA multiple compensates for its average credit risk score, making it an attractive investment option.
Cansortium's position as having the lowest EBITDA multiple in the group could attract investors looking for undervalued stocks, potentially boosting its short-term stock price.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
Green Thumb ranks as the most attractive cannabis stock due to its strong credit risk score, despite a higher-than-average EBITDA multiple.
Green Thumb's high attractiveness score, driven by its excellent credit risk score, suggests a positive short-term impact on its stock price as investors may favor stocks with strong credit profiles.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
AYR's balance of a low EBITDA multiple and a higher credit risk score positions it as a moderately attractive investment.
AYR's middle-ground attractiveness may lead to a neutral short-term impact on its stock price as the market weighs its low valuation against credit risk.
CONFIDENCE 75
IMPORTANCE 50
RELEVANCE 60
NEGATIVE IMPACT
Acreage's reasonable EBITDA multiple is overshadowed by its poor credit ranking, making it an unattractive investment.
Acreage's low credit ranking could lead to a negative short-term impact on its stock price as investors may be cautious about its creditworthiness.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
Curaleaf's high EBITDA multiple does not compensate for its reasonable credit strength, making it relatively unattractive.
Curaleaf's leading EBITDA multiple may deter investors despite its decent credit rating, potentially leading to a negative short-term impact on its stock price.
CONFIDENCE 80
IMPORTANCE 65
RELEVANCE 75