There’s a good number of catalysts for cannabis stocks to buy.
We already know 88% of Americans want legalization, which the current candidates should use to their advantage for votes. In addition, we know that Germany just legalized its use, which could set off a domino effect across Europe. We know cannabis will be rescheduled as a Schedule III drug at some point.
And we know that Florida will vote on legalization, which could be key to unlocking a potential tripling of the total cannabis market in Florida to $6 billion in sales, as noted by Benzinga.com. Further, a new poll from Florida Politics shows about 64% of Florida voters voting for legalization. “To pass, the constitutional amendment requires at least 60% of the votes cast in November’s election,” added MarijuanaMoment.net.
Here are some of the top cannabis stocks to buy that are likely to see higher highs, especially on Florida’s potential legalization.
Curaleaf Holdings (CURLF)
Curaleaf Holdings (OTCMKTS:CURLF) is one of the top stocks that could benefit from Florida’s vote for legalization. Alliance Global Partners also raised its price target to $12.
In addition, according to CEO Matt Darin, “Our unique exposure to the most significant catalysts on the horizon – continued expansion of the NY market, expansion of Pillar 1 in Germany, and adult use in Ohio, Florida and Pennsylvania sets us up for robust growth in 2025 and beyond.”
Granted, earnings haven’t been so hot. Its earnings per shares loss of 7 cents missed by 2 cents in its first quarter. Revenue of $339 million (up 0.7% year over year missed by $560,000. However, did end the quarter with $105 million of cash. It also generated operating and free cash flow from continuing operations of $46 million and $33 million, respectively.
The potential for legalization in Florida could boost all of its numbers moving forward.
Trulieve Cannabis (TCNNF)
Another top cannabis stock to buy ahead of the election is Trulieve Cannabis (OTCMKTS:TCNNF). Alliance Global Partners noted that TCNNF is best positioned for potential legalization in Florida.
In addition, analysts at Needham also raised their price target on TCNNF to $14.50 with a buy rating. Analysts at Canaccord also raised their price target to $38, with a buy rating.
Earnings were solid. Its first-quarter EPS loss of 5 cents beat by 6 cents. Revenue of $298 million — up 4.6% year over year — beat by $12.27 million. Better, it generated free cash flow from operations of $139 million and a free cash flow of $124 million.
Currently trading at $9.25, I’d use recent weakness as a buy opportunity with TCNNF. From that current price, I’d like to see it initially retest $13 a share near term.
Verano Holdings (VRNOF)
We can also look at Verano Holdings (OTCMKTS:VRNOF), which should also benefit from Florida’s legalization. The company has 77 dispensaries in Florida.
While its chart isn’t worth writing home about either, give it time. With the potential for legalization in Florida, the stock could easily rally well off recent lows. The company also authorized a $50 million share buyback plan.
Even better, VRNOF should benefit from not being bothered with the 280E tax with the upcoming rescheduling and potential legalization in Florida.
As it stands now, “Section 280E has been applied to state-legal cannabis businesses, as cannabis is still declared a Schedule I substance. This applies to all businesses that partake in the cultivation, sale, or processing of the cannabis plant, for medical or recreational use,” as noted by the Marijuana Policy Project.
Last trading at $3.52, I’d like to see VRNOF initially retest $6 a share as we get closer to the potential for legalization in Florida.
On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
