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 05/23/2025
Sector Valuation – Cultivation & Retail sector
- The number of cultivation and retail companies in our public company database has decreased to 79 from 82 a year ago due to mergers and delistings.
- The valuation metrics are in a holding pattern, with the group median EV/2025 EBITDA at 5.2x, roughly unchanged over the last month. Adj. EV/EBITDA tells a more accurate story, in our opinion. The 6.49x median, including tax liabilities and operating leases, is more in keeping with the true nature of the cannabis capital stack. Cannabis companies rely on long-term leases for a significant part of their core operating assets, and leaving out these obligations as the standard EV/EBITDA does is hard to defend.
- We have recently shown that U.S. companies in the group trade at substantially lower multiples, reflecting illiquid stocks and the 280E provision. However, the upside leverage to any meaningful cannabis legal reform continues to be enormous. We continue to be bullish.
Week ended 05/23/2025
Sector Valuation – Cultivation & Retail sector
- The number of cultivation and retail companies in our public company database has decreased to 79 from 82 a year ago due to mergers and delistings.
- The valuation metrics are in a holding pattern, with the group median EV/2025 EBITDA at 5.2x, roughly unchanged over the last month. Adj. EV/EBITDA tells a more accurate story, in our opinion. The 6.49x median, including tax liabilities and operating leases, is more in keeping with the true nature of the cannabis capital stack. Cannabis companies rely on long-term leases for a significant part of their core operating assets, and leaving out these obligations as the standard EV/EBITDA does is hard to defend.
- We have recently shown that U.S. companies in the group trade at substantially lower multiples, reflecting illiquid stocks and the 280E provision. However, the upside leverage to any meaningful cannabis legal reform continues to be enormous. We continue to be bullish.
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