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 08/11/2023
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 database’s ninety-three cultivation & Retail sector companies now have median market-to-book and market-to-tangible book values of .48x and .3x, respectively, suggesting that many companies may be required to take impairment charges. A preview of this is the $22M impairment charge that Cresco Labs (CL: CSE) just announced for Q2:23. The 3rd quartile figures of .9x and 1.14x for market-to-book and market-to-tangible book values, respectively, at least give us some assurance that the top twenty competitors should be able to avoid writedowns. With many of the sector’s stocks trading at 52-week lows, the EV/2023 EBITDA median of 5.36x should be near the bottom. We were encouraged to see that nine out of the fourteen U.S. companies that reported Q2: 23 earnings beat expectations on the EBITDA line.
Week ended 08/11/2023
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 database’s ninety-three cultivation & Retail sector companies now have median market-to-book and market-to-tangible book values of .48x and .3x, respectively, suggesting that many companies may be required to take impairment charges. A preview of this is the $22M impairment charge that Cresco Labs (CL: CSE) just announced for Q2:23. The 3rd quartile figures of .9x and 1.14x for market-to-book and market-to-tangible book values, respectively, at least give us some assurance that the top twenty competitors should be able to avoid writedowns. With many of the sector’s stocks trading at 52-week lows, the EV/2023 EBITDA median of 5.36x should be near the bottom. We were encouraged to see that nine out of the fourteen U.S. companies that reported Q2: 23 earnings beat expectations on the EBITDA line.
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