U.S. Cannabis Leaders Hit Impressive Double-Digit Gains
As we step into 2024, the cannabis industry is witnessing a significant uptrend, highlighting the growing potential of top marijuana stocks. Recent statistics underscore this growth trajectory. The global cannabis market, valued at $22.6 billion in 2021, is projected to expand at a compound annual growth rate (CAGR) of 14.9% from 2022 to 2030. This boom is partly driven by increasing legalization and societal acceptance. In the United States, leading cannabis companies are capitalizing on this surge. Companies like Curaleaf Holdings, Green Thumb Industries, Cresco Labs, and Trulieve Cannabis have emerged as prominent players. Their growth mirrors the industry’s overall expansion, making them key stocks to watch in 2024.
For traders, this uptrend presents diverse opportunities, both short-term and long-term. Short-term traders are increasingly adopting swing trading strategies. This approach involves holding stocks for several days to capitalize on expected upward or downward market shifts. Technical analysis is crucial in this context, aiding traders in identifying optimal entry and exit points. Long-term investors, on the other hand, focus on the broader growth trends in the cannabis sector. They rely on fundamental analysis and proper risk management to navigate this evolving market. Balancing these trading strategies is essential for maximizing returns while mitigating risks in the dynamic landscape of top marijuana stocks.
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Top U.S. Cannabis Stocks With Double Digits To Start 2024
Cresco Labs Inc.
Cresco Labs Inc., a key player in the U.S. cannabis market, was founded in 2013 with the ambitious goal of reshaping and elevating the cannabis industry. Operating with a focus on vertical integration, Cresco’s business model spans from cultivation and manufacturing to a robust retail presence. Renowned for their strict adherence to regulatory compliance and a commitment to consistent product quality, Cresco Labs has earned a reputation for being a reliable and progressive force in the cannabis sector.
In the current landscape of 2024, Cresco Labs has established a commanding presence in the American cannabis market with an impressive network of 70 Sunnyside dispensaries spread across seven states. Their strongest footprints are in Illinois, Pennsylvania, and Ohio, which are pivotal markets in the U.S. cannabis industry. This strategic distribution of dispensaries in states with high growth prospects underscores Cresco’s well-thought-out expansion strategy. It also highlights their growth trajectory and dedication to becoming a dominant player in the dynamic and evolving cannabis market.
Third Quarter 2023 Financial Highlights
In its third quarter of 2023, Cresco Labs Inc. reported notable financial achievements. The company’s revenue reached $191 million, driven by growth in retail and strong performance in core markets. This growth effectively offsets the impact of divested assets. A key highlight is the successful implementation of their Year-of-the-Core strategy since Q1. As a result, adjusted gross margins saw an increase of over 480 basis points. Adjusted SG&A expenses decreased significantly by $40 million annually. Furthermore, Cresco’s adjusted EBITDA margin experienced a remarkable rise of over 1000 basis points. The company also reported a healthy operating cash flow, generating $62 million in the first nine months.
Cresco’s financial performance also included a gross profit of $94 million, accounting for 49% of its revenue. There was an increase in adjusted gross profit to $96 million. The adjusted gross margin improved to 51%, up 373 bps from the previous quarter. Adjusted SG&A expenses were reduced to $57 million, less than 30% of revenue. The company’s adjusted EBITDA stood at $49 million, which is 26% of the revenue, marking a 21% sequential increase. Despite these positive trends, Cresco faced challenges, including a net loss of $113 million due to one-time, non-cash impairment charges totaling $129 million. This loss was partially mitigated by generating a positive operating cash flow of $41 million, inclusive of $8 million in one-time charges.
CRLBF Stock Performance
CRLBF shares finished on January 5th at $1.79, up 32.03% in the last week of trading. In this case, the stock is presently trading in a 52-week price range of $1.00-$2.77, showing a 32.03 percent increase year to date.
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Jushi Holdings Inc.
Jushi Holdings Inc., established as a multi-state cannabis operator, is engaged in a range of activities including retail, cultivation, manufacturing, and processing. Catering to both medical and adult-use markets, the company is committed to building a diverse portfolio of cannabis assets. This involves opportunistic investments, acquisitions, and application opportunities in attractive, limited license markets. Jushi’s focus is on delivering high-quality products across the cannabis ecosystem, intending to maximize shareholder value.
As of 2024, Jushi Holdings Inc. operates 40 dispensaries across the United States. The company has a particularly strong presence in states such as Pennsylvania, Illinois, and California. These states are known for their favorable cannabis laws and large consumer bases, making them key markets in the cannabis industry. Jushi’s strategic expansion in these regions underscores its focus on capturing significant market shares in these lucrative areas. This strategy has positioned Jushi Holdings as a formidable competitor in the dynamic U.S. cannabis landscape.
Third Quarter 2023 Financial Highlights
In the third quarter of 2023, Jushi Holdings Inc. reported a total revenue of $65.4 million. The company’s gross profit margin increased to 43.6%, up from 38.1% in the same quarter the previous year. However, it was slightly lower than the 46.0% reported in Q2 2023. The net loss for the quarter was $20.6 million, marking a significant year-over-year improvement of $34.1 million. Additionally, the company reported an Adjusted EBITDA of $9.7 million, improving by $9.1 million compared to the previous year. They ended the quarter with cash and equivalents totaling $30.5 million.
Operationally, Jushi achieved significant improvements at its grower-processor facilities in Pennsylvania, Virginia, and Massachusetts. The company introduced a new premium flower brand, Hijinks, in Pennsylvania and Massachusetts, with plans for a Nevada launch in early 2024. The Kind Grind line expanded into Pennsylvania following success in Massachusetts, with Virginia expected to follow suit. In Q3, Jushi debuted 10 new SKUs across five brands and plans to introduce more by year-end. They also expanded their retail footprint in Virginia with a new Beyond Hello™ dispensary. Jushi-branded products accounted for over 52% of total retail revenue in Q3 2023. Post-quarter, they continued debt reduction efforts and anticipate significant proceeds from non-core asset sales.
JUSHF Stock Performance
JUSHF stock closed at $0.62 on January 5th, up 34.77% in the last week of trading. In this case, the stock has a 52-week price range of $0.35-$0.94 and is up 34.77% year to date.
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U.S. Cannabis Stocks Surge into Double-Digit Growth
For those investing in top U.S. marijuana stocks, key focus areas should include robust risk management and the use of technical analysis. Furthermore, understanding market trends and employing tools like moving averages and RSI is crucial for determining the best times to buy or sell. While doing this, a comprehensive grasp of market dynamics and company fundamentals should not be overlooked.
Looking ahead to 2024, the U.S. cannabis industry’s prospects seem promising, spurred by increased legalization and social acceptance. In general, companies with strategic growth plans and diverse product offerings are likely to benefit from this expansion. However, investors should remain vigilant about regulatory changes and competitive pressures, which could influence the market’s direction. Staying well-informed and applying sound trading strategies are essential for navigating this dynamic industry.
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