OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS
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Valuation Tracker By Industry Sector
Valuation Tracker By Sector
The Viridian Value Tracker is the most comprehensive valuation product in the industry.
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- A broad set of 12 valuation measures assures applicability, regardless of whether the company has analyst coverage or revenues. The typically presented EV/ Projected Revenues and EV/ Projected EBITDA are available for less than 1/3 of the cannabis companies we track.
- Most valuation studies present only the average valuation measures, while the Tracker goes one step further and shows the distribution of values (the quartiles, median, and dispersion) for each measure. This gives users a more complete view of how companies in the cohort group are valued.
Week ended 12/29/2023
Our sector trackers include ratios applicable to value companies with no analyst coverage and the more typical EV/ Revenues and EV/ EBITDA measures. For each valuation measure, we present the values for the lowest 25% of companies, the median, and the highest 25%. This gives investors a better understanding of the spread of values than a simple average, often presented but frequently seriously flawed by outliers. Psychedelics demonstrates the wide variance of valuation metrics perfectly. The median market-to-book ratio for the 25 companies in the Viridan Value Tracker database is 1.15x, but 25% are below .55x, while 25% are above 2.16x. Knowing the median (or worse yet, the average) doesn’t get an analyst very far. The situation is even worse when one looks at revenue multiples. Only 9 of the 25 companies had meaningful revenue in the third quarter, and EV/ Annualized revenue ranged from a 1st quartile figure of .41x to a third quartile of 5.61x!
Week ended 12/29/2023
Our sector trackers include ratios applicable to value companies with no analyst coverage and the more typical EV/ Revenues and EV/ EBITDA measures. For each valuation measure, we present the values for the lowest 25% of companies, the median, and the highest 25%. This gives investors a better understanding of the spread of values than a simple average, often presented but frequently seriously flawed by outliers. Psychedelics demonstrates the wide variance of valuation metrics perfectly. The median market-to-book ratio for the 25 companies in the Viridan Value Tracker database is 1.15x, but 25% are below .55x, while 25% are above 2.16x. Knowing the median (or worse yet, the average) doesn’t get an analyst very far. The situation is even worse when one looks at revenue multiples. Only 9 of the 25 companies had meaningful revenue in the third quarter, and EV/ Annualized revenue ranged from a 1st quartile figure of .41x to a third quartile of 5.61x!
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