Green Thumb Industries Inc: Pot Stock Up 170% Since March, Set to Soar

Green Thumb Industries Inc Up About 170% Since March

Green Thumb Industries Inc (OTCMKTS:GTBIF, CNSX:GTII) has been one of the hottest U.S. cannabis stocks since the COVID-19-fueled sell-off in February and March. Since March 16, when GTBIF stock hit a low of $3.69, it has soared about 170% and is currently trading at around $10.00 per share.

Why the ongoing bullishness for Green Thumb Industries stock?

The multi-state operator reported strong first-quarter results, achieving a major milestone by breaking $100.0 million in quarterly revenue, along with recording substantial growth in earnings before interest, tax, depreciation, and amortization (EBITDA).

The company has also been launching new products and opening new dispensaries.

GTBIF Stock Overview

Green Thumb Industries is a multi-state, seed-to-sale cannabis company based in Chicago. It has 13 cultivation and manufacturing facilities, 48 open retail locations, and licenses for 96 retail locations. (Source: “Investor Presentation, June 2020,” Green Thumb Industries Inc, last accessed July 7, 2020.)

It has operations in 12 U.S. states, including California, Florida, and New York. The company also has a strong presence in Illinois, which legalized recreational marijuana on January 1, 2020.

Through its June 2019 acquisition of Integral Associates, Green Thumb has a foothold in Nevada, one of the world’s top tourist playgrounds. (Source: “Green Thumb Industries Inc. (GTI) Closes on Acquisition of Integral Associates,” GlobeNewswire, June 5, 2020.)

Integral Associates has four retail stores located across the Las Vegas area, including the only legal cannabis retail store on the Las Vegas Strip. It also has eight additional retail licenses in Nevada: five in Las Vegas and three in Northern Nevada.

Green Thumb’s branded cannabis products include “Rhythm,” “Beboe,” “Dogwalkers,” and “incredibles.” It also owns and operates a growing number of national retail recreational cannabis stores: “Rise” and “Essence.” (Source: “Green Thumb Industries Reports First Quarter Revenue of $102.6 Million and Adjusted Operating EBITDA of $25.5 Million,” Green Thumb Industries Inc, May 14, 2020.)

Green Thumb also operates a number of medical marijuana dispensaries: “3C” in Illinois, “Bluepoint Wellness CT” in Connecticut, and “Fp Wellness” in New York State.

Chart courtesy of StockCharts.com

Q1 Revenue Up 267%, With EBITDA of $25.5 Million

In May, Green Thumb announced that its revenue for the first quarter of 2020, ended March 31, increased 267.6% year-over-year and 34.5% sequentially to $102.6 million. (Source: Green Thumb Industries Inc, May 14, 2020, op. cit.)

The company reported a first-quarter net loss of $4.2 million, or $0.02 per share, down from a net loss of $14.1 million, or $0.07 per share, in the fourth quarter of 2019.

It reported first-quarter EBITDA of $20.3 million, an improvement from the $7.8 million in the fourth quarter and the loss of $10.4 million in the same period last year.

Green Thumb Industries Inc reported adjusted operating EBITDA of $25.5 million, an 85% increase over the $13.8 million recorded in the fourth quarter and a 13-fold increase year-over-year.

The company ended the first quarter with total assets of $140.8 million, which includes cash and equivalents of $71.5 million. Total debt was $92.9 million.

“Our business model continues to prove out and we delivered outstanding first quarter results,” said Ben Kovler, founder and CEO.

“We achieved a major milestone by breaking $100 million in quarterly revenue along with substantial EBITDA growth. These factors helped contribute to our positive free cash flow from operations.” (Source: Ibid.)

Analyst Take

Green Thumb Industries stock continues to be one of the best U.S. cannabis stocks out there. The company has been entering new markets, opening new dispensaries, launching new products, and accelerating the build-out of its infrastructure—including e-commerce, customer service, delivery, and curbside pickup.

Thanks to Green Thumb Industries Inc’s strong operational strength, which is supported by a strong balance sheet, the company continues to differentiate and position itself for long-term success.