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 04/04/2025
Sector Valuation – Cultivation Sector Disconnect
- The 29 cultivation and retail companies for which we have consensus sell-side estimates now have a median EV/ 2025 EBITDA of 4.35x, significantly higher than the 3.95x we calculated for the top 12 U.S. MSOs, thereby demonstrating that the tax and senior listing disadvantages that the US competitors labor under, IS priced into their shares.
- Cannabis companies that are robust enough to withstand the regulatory status quo indefinitely (and admittedly, there may be only a few of them) are trading below intrinsic values. However, we are reminded of the famous Keynes quote, “The market can remain irrational longer than you can remain solvent.”
Week ended 04/04/2025
Sector Valuation – Cultivation Sector Disconnect
- The 29 cultivation and retail companies for which we have consensus sell-side estimates now have a median EV/ 2025 EBITDA of 4.35x, significantly higher than the 3.95x we calculated for the top 12 U.S. MSOs, thereby demonstrating that the tax and senior listing disadvantages that the US competitors labor under, IS priced into their shares.
- Cannabis companies that are robust enough to withstand the regulatory status quo indefinitely (and admittedly, there may be only a few of them) are trading below intrinsic values. However, we are reminded of the famous Keynes quote, “The market can remain irrational longer than you can remain solvent.”
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