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 09/29/2023
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 agriculture sector has 20 members worldwide and has median market-to-book and EV/ annualized revenues of .41x and .83x, respectively. Interestingly, the 8 Canadian companies in the sector have significantly higher valuation metrics, with a median market-to-book of 1.52x and EV/ Annualized revenues of 2.16x. The U.S. lags with a median market-to-book of .1x and EV/annualized revenue of 1.57x. Focusing on the largest three competitors with market caps over $20M (GrowGeneration, Hydrofarm, and Scott’s Miracle Grow) doesn’t change the picture. The median market to book is .87x, and EV/ annualized revenues are .95x. Averages make little sense on the market to book because of Scott’s sizeable negative book equity. Similarly, the average EV/annualized revenues of .76x are affected by Scott’s measure of 1.3x compared to .43x for GrowGeneration and .6x for Hydrofarm (the median). Statistics on sectors and regions are helpful for investors, but Viridian’s ability to drill down by size and location (and other variables) often uncovers particularly fascinating patterns.
Week ended 09/29/2023
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 agriculture sector has 20 members worldwide and has median market-to-book and EV/ annualized revenues of .41x and .83x, respectively. Interestingly, the 8 Canadian companies in the sector have significantly higher valuation metrics, with a median market-to-book of 1.52x and EV/ Annualized revenues of 2.16x. The U.S. lags with a median market-to-book of .1x and EV/annualized revenue of 1.57x. Focusing on the largest three competitors with market caps over $20M (GrowGeneration, Hydrofarm, and Scott’s Miracle Grow) doesn’t change the picture. The median market to book is .87x, and EV/ annualized revenues are .95x. Averages make little sense on the market to book because of Scott’s sizeable negative book equity. Similarly, the average EV/annualized revenues of .76x are affected by Scott’s measure of 1.3x compared to .43x for GrowGeneration and .6x for Hydrofarm (the median). Statistics on sectors and regions are helpful for investors, but Viridian’s ability to drill down by size and location (and other variables) often uncovers particularly fascinating patterns.
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