Top Cannabis Stocks In May 2023
Are you looking for the top marijuana stocks to own long-term? In general, the value of most cannabis stocks has decreased, making them an attractive investment in 2023. Ancillary marijuana stocks are one potential sector for long-term investments for cannabis investors.
Cannabis REITs, often known as real estate investment trusts, own and manage real estate holdings utilized to produce cannabis. In specific, warehouses, greenhouses, and other cannabis product manufacturing, processing, and distribution facilities could be found in these areas.
Overall, cannabis REITs provide investors with a way to invest in the developing cannabis market without actually purchasing stock in companies that produce or sell the substance. Instead, they can decide to invest in the sector’s underlying real estate holdings. This could be a less risky option to invest in the cannabis market because real estate investments often have lower volatility than investments in individual securities.
Expanding the cannabis sector this year can offer opportunities for new investors. Numerous cannabis businesses in the US are getting ready to grow with the market as it continues to rise. Below is a list of the top 2 US cannabis REITs to watch in May.
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Top US Cannabis REITs To Watch In May 2023
- Innovative Industrial Properties, Inc. (NYSE: IIPR)
- AFC Gamma, Inc. (NASDAQ: AFCG)
Innovative Industrial Properties, Inc.
Innovative Industrial Properties, Inc., a real estate investment firm focusing on the cannabis market, is based in the United States. The firm has 8.7 million square feet of rentable space available right now, and 2.5 million square feet more will be available soon. With an average lease duration of 16.4 years, the majority of these structures are completely leased. The company currently has 108 properties distributed throughout 19 states. IIP has already invested $2.4 billion in property upgrades as of April, in addition to the estimated rent payments of $227.1 million. IIP estimates that its lease portfolio will grow significantly in 2022 due to its ongoing real estate investments, particularly in Pennsylvania and Massachusetts.
For the first quarter of 2023, IIP generated total revenues of approximately $76.1 million in the quarter, representing an 18% increase from the prior year’s quarter. In addition, the company produced recorded net income attributable to common stockholders of approximately $40.8 million for the quarter or $1.43 per diluted share. Also, IIP paid a quarterly dividend of $1.80 per common share on April 14, 2023, to stockholders of record as of March 31, 2023 (an AFFO payout ratio of 80%), equal to an annualized dividend of $7.20 per share. The common stock dividends declared for the twelve months ended March 31, 2023, of $7.15 per common share represent an increase of $1.00, or 16%, over dividends declared for the twelve months ended March 31, 2022.
As of Q1 2023, the company has a total property portfolio comprising 108 properties across 19 states, with approximately 8.9 million rentable square feet (including approximately 1.6 million rentable square feet under development/redevelopment).
IIPR Stock Performance
On May 8th, IIPR stock closed at $69.27, down 4.78% in the last month of trading. The stock is currently trading in a 52-week price range of $63.36-$139.54, down 31.65% year to date. In this case, IIPR stock has a 12-month median price target of $125 per share, according to CNN Business analysts. In this forecast, this would be an 80.17% increase over the last trade price of $69.27.
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AFC Gamma, Inc.
AFC Gamma, Inc. is a well-known cannabis ancillary company with a healthy cash flow and capable management. The business was established in 2020, focusing on supply and demand theories, markets for those theories, real estate security, and other kinds of collateral. In general, some of AFCG’s areas of expertise include first-lien loans, mortgage loans, construction loans, bridge financings, and other uncommon kinds of financing. The recent marketing attempts of AFC Gamma have been centered on the quickly growing cannabis market. In addition, the corporation granted Verano Holdings Inc a $250 million credit line and a $100 million option.
For the fourth quarter of 2022, AFC Gamma reported distributable earnings of $12.6 million, or $0.62 per basic weighted average common share. Additionally, net income calculated following generally accepted accounting principles (“GAAP”) of $2.9 million, or $0.14 per basic common share. The company declared GAAP net income of $35.9 million for the entire year of 2022, or $1.80 per basic weighted average common share, and Distributable Profits of $49.9 million, or $2.51 per basic weighted average common share.
The Company’s Board of Directors declared a regular cash dividend of $0.56 per Common Share for the first quarter of 2023. The common stockholders having records as of March 31, 2023, will receive the first quarter 2023 dividend on April 14, 2023. The company is scheduled to release its first quarter 2023 results on May 10th before the market opens.
AFCG Stock Performance
On May 8th, AFCG shares closed at $11.07, a 3.66 percent decline from the previous month of trading. The stock, which has a price range of $10.83 to $19, is down 29.62% year to date. In this case, analysts at CNN Business predict that the 12-month average price for AFCG shares will be $19. In comparison to the stock’s most recent trading price of $11.07, this prediction shows a gain of 71.02 percent.
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Top Cannabis REIT Stocks For 2023
For new investors searching for long-term investments in the cannabis sector, these top cannabis REITs can be a suitable option. Generally, you should always research before investing in a company. In addition, to determine which companies represent the best investments, it’s necessary to review their financial statements and press releases. These marijuana stocks may be the ones to watch in 2023 for long-term investments in the cannabis industry.
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