Best Ancillary Cannabis Stocks To Watch Now
Do you intend to purchase marijuana stocks in 2023? Over the last decade, the cannabis industry has witnessed tremendous development and transformation, transitioning from a taboo subject to a legitimate and lucrative corporate sector. As the global cannabis market expands in 2023, investors will move their focus to ancillary cannabis stocks, which will play an important role in supporting and propelling the industry forward.
Ancillary cannabis stocks are companies that provide products, services, and infrastructure to the cannabis sector but do not cultivate or distribute cannabis. These businesses operate in a variety of industries, including technology, packaging, logistics, financial services, and others. Investors can acquire exposure to the industry’s development potential while mitigating some of the inherent risks associated with the regulatory landscape by investing in ancillary cannabis stocks.
Technology is one significant area of growth in ancillary cannabis stocks. Innovations in production techniques, seed genetics, data analytics, and software solutions have transformed the cannabis sector. Companies that specialize in innovative cultivation systems, smart monitoring technology, and seed-to-sale tracking software have become indispensable partners for farmers, allowing them to optimize production, improve quality, and assure regulatory compliance.
In addition, cannabis stocks involved in packaging, branding, marketing, and distribution have risen tremendously. Companies specializing in novel packaging solutions, product branding, and marketing techniques are in great demand as cannabis goods become more mainstream. These companies assist cannabis businesses in developing strong brand identities, adhering to labeling rules, and differentiating themselves in a competitive industry. Let’s look at 3 top ancillary marijuana stocks to close the week.
Best Ancillary Cannabis Stocks For May
- WM Technology, Inc. (NASDAQ: MAPS)
- Leafly Holdings, Inc. (NASDAQ: LFLY)
- High Tide Inc. (NASDAQ: HITI)
WM Technology, Inc.
Weedmaps is a cannabis industry online store and a user and business directory. WM Technology, Inc. is the company’s owner. Cannabis retailers typically use WM Business’s cloud-based SaaS solutions as their operating system. WM Business’s products and services frequently make it easier to comply with the cannabis industry’s complicated and ever-changing regulatory regulations. To widen its product line, WM Technologies announced a digital payment option in Ontario in May. This benefited small businesses because curbside pickup, delivery, and cashless transactions became increasingly necessary.
Weedmaps reported first-quarter 2023 revenue of $48.0 million compared to $57.5 million in the first quarter of 2022. In addition, the average monthly paying clients was 5,641, compared to 5,026 from the prior year period. The company sustained a net loss was $4.0 million as compared to a net loss of $31.2 million from the prior year period. Adjusted EBITDA was $7.1 million as compared to $(1.0) million from the prior year period. The company also released second-quarter 2023 guidance, with revenue estimated to be consistent with the first quarter of 2023.
MAPS Stock Performance
MAPS stock closed at $1.12 on May 18th, up 49.51% in the last month of trading. The stock has a 52-week price range of $0.596- $6.33 and is up 10.89% year to date. According to analysts at CNN Business, MAPS stock has a 12-month average price target of $2.25 per share. In essence, this would represent an upside of 100% from its last trading price of $1.12.
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Leafly Holdings, Inc.
Leafly Holdings Inc. owns and operates a platform that connects customers with cannabis brands, licensed shops, and educational resources. The company is the most dependable platform for locating and purchasing cannabis products from licensed dealers all around the world. Every year, over 125 million people use Leafly to learn about cannabis and buy it from nearby businesses online. Customers can make informed purchasing decisions since the organization has a wealth of tools, including technology and advertising services. This helps cannabis businesses retain customers while also attracting new ones. Customers may now buy cannabis directly from the company’s website, owing to the online cannabis delivery service that the company established when it first opened its doors in California in May.
Revenue for the first quarter of 2022 was $11.2 million, a 1.5% decrease from the previous quarter. In addition, the gross margin was 88%, up from 87% in Q1 2022. Total operating expenses were $14.9 million, a 14.7% decrease from $17.4 million in the first quarter of 2022, reflecting the impact of newly announced cost-cutting efforts. The company’s net loss for the first quarter of 2023 was $5.4 million. This compares to a net loss of $19.4 million in the first quarter of 2022. The adjusted EBITDA loss was $3.3 million, compared to a $5.4 million loss in Q1 2022. Leafly completed the first quarter with 5,702 retail accounts, a 5% increase over the first quarter of 2022, as shops in both existing and new recreational markets utilized the Leafly platform. The company provided investors with guidance for the second quarter of 2023.
The company issued second-quarter 2023 guidance for investors. Based on current business trends and conditions, the financial outlook is expected to be around $10.5 million in revenue and adjusted EBITDA loss to be around $2.1 million.
LFLY Stock Performance
LFLY stock closed on May 18th at $0.3861, up 12.34% in the past month of trading. Currently, the stock has a range of $0.3118-$10.92 and is down 40.77% year to date. According to analysts at CNN Business, LFLY stock has a median price target of $2.00 per share. In this case, this would represent an upside of 422.33% from its last trading price of $0.38.
[Read More] Best US Marijuana Stocks For May 2023 Watchlist
High Tide Inc.
High Tide Inc. is a cannabis dispensary making and distributing cannabis-based products. In addition to a well-known Canadian cannabis brand, High Tide’s portfolio includes a reputable international manufacturer and distributor of cutting-edge smoking accessories. The company’s primary goal was to dominate the internet accessory supply market. The High Tide brand is presently available at 127 retailers across Canada. Blessed CBD’s main market is the United Kingdom, and High Tide purchased the company in October 2021. With the launch of its 66th retail cannabis store, the firm increased its market share and beat all competitors to secure the top spot in Alberta’s market. According to High Tide, the purchase of NuLeaf Naturals was the largest the company has ever made.
In the first fiscal quarter of 2023, revenue climbed by 64% year on year and 9% sequentially, rising from $72.2 million to $118.1 million. Furthermore, the gross profit climbed by 40% year over year and 9% sequentially from $23.0 million in the same time in 2022 to $32.2 million in the first fiscal quarter of 2023. Same-store sales climbed by 52% compared to the previous year for sites open for business during the first fiscal quarter of 2023 and 2022. By introducing ELITE, Canada’s first cannabis-related paid loyalty club, the company’s membership has climbed by 58% to 9,500 by January 30, 2023. In May, the company opened a new Canna Cabana location, its 77th store in Alberta.
HITI Stock Performance
The shares of HITI finished at $1.30 on May 18th, down 3.70% in the last month of trading. The stock is trading in a 52-week price range of $1.0340 to $2.87, down 15.58% year to date. According to Tip Ranks analysts, HITI stock has an average price target of $7.32 per share. In this example, the upside would be 463.08% over the current market price of $1.30.
Best Ancillary Pot Stocks To Watch
Examining financial accounts and press releases will help you find the top cannabis companies on the market. Many seasoned investors are actively trading short-term stakes in the leading cannabis companies in order to profit from the present market volatility. Prior to establishing a position, use technical indicators and chart patterns to determine the optimum entry points and take-profit zones. You can improve your ability to close profitable trades by putting yourself in advantageous situations. Because of their volatility, the most well-known marijuana companies may be among the top ancillary stocks to watch in 2023.
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