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 08/04/2023
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. The eleven Real Estate sector companies have been looking better since the beginning of June. The chart shows that only 6 of the 93 Hemp sector companies in the Viridian Database have analyst coverage. To get a better handle on this sector, we look to market-to-book ratios (group median of 0.27x), market-to-tangible book value (median of 0.37x), and EV/ annualized revenues (median of 1.08x). The EV/ annualized revenues doesn’t strike us as crazy, given the multi-year downturn the industry has gone through. Significant uncertainties continue regarding a new farm bill and its potential treatment of non-THC intoxicants like D8. The market-to-book ratios tell us that there are likely to be substantial goodwill and other asset writedowns in the sector.
Week ended 08/04/2023
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. The eleven Real Estate sector companies have been looking better since the beginning of June. The chart shows that only 6 of the 93 Hemp sector companies in the Viridian Database have analyst coverage. To get a better handle on this sector, we look to market-to-book ratios (group median of 0.27x), market-to-tangible book value (median of 0.37x), and EV/ annualized revenues (median of 1.08x). The EV/ annualized revenues doesn’t strike us as crazy, given the multi-year downturn the industry has gone through. Significant uncertainties continue regarding a new farm bill and its potential treatment of non-THC intoxicants like D8. The market-to-book ratios tell us that there are likely to be substantial goodwill and other asset writedowns in the sector.
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