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 03/01/2024
Valuation in the Cultivation and Retail sector dropped this week as rumors hit the market that the DEA announcement will likely be delayed until April. Several pundits had speculated that the announcement would come before the State of the Union address. The thirty-seven analyst-rated companies show a huge spread across nearly every valuation metric. For example, EV/2023 EBITDA ranges from a 1st quartile value of 2.96x to a third quartile value of 10.39x. This roughly corresponds to cash flow self-sufficiency. Our Chart of the Week broke the U.S. sector into three groups: 1) those that didn’t need 280e relief to get by and may possess a competitive advantage in the current climate, 2) those that could get by (at least until 2026 when debt maturities kick back up) but would benefit from 280e relief, and 3) those that were overleveraged on either an EBITDA or market cap basis to the point that 280e relief might not be enough. Our data shows that companies with poor balance sheets are paying the price via lower valuations.
Week ended 03/01/2024
Valuation in the Cultivation and Retail sector dropped this week as rumors hit the market that the DEA announcement will likely be delayed until April. Several pundits had speculated that the announcement would come before the State of the Union address. The thirty-seven analyst-rated companies show a huge spread across nearly every valuation metric. For example, EV/2023 EBITDA ranges from a 1st quartile value of 2.96x to a third quartile value of 10.39x. This roughly corresponds to cash flow self-sufficiency. Our Chart of the Week broke the U.S. sector into three groups: 1) those that didn’t need 280e relief to get by and may possess a competitive advantage in the current climate, 2) those that could get by (at least until 2026 when debt maturities kick back up) but would benefit from 280e relief, and 3) those that were overleveraged on either an EBITDA or market cap basis to the point that 280e relief might not be enough. Our data shows that companies with poor balance sheets are paying the price via lower valuations.
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