On October 1st, Trulieve Cannabis (CSE: TRUL) announced that they completed their $1.75 billion acquisition of Harvest Health. Harvest shareholders received 0.1170 shares of Trulieve for each subordinate voting share held.
A number of analysts raised their 12-month price targets off the back of the acquisition. This brought the average 12-month price target up to C$84.80, or a 137% upside. There are 17 analysts covering the stock, with 5 analysts having strong buy ratings and the other 12 have buy ratings. The street high sits at C$132 from Stifel-GMP while the lowest comes in at C$54.
In Haywood Capital Market’s note, they reiterated their C$80 price target and buy rating on Trulieve Cannabis saying that this establishes Trulieve as one of the top tier-1 MSO’s. They add, “The acquisition was completed within 5 months which is an impressive accomplishment in our view.”
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With this acquisition, Trulieve grows its addressable market from 6 to 11, gaining 5 new markets and going deeper in 4 markets Haywood says. They believe that margin compression will come with the acquisition but comment that the additional markets are a worthy trade-off “for its long-term growth trajectory while also being able to maintain healthy margins.”
Below you can see Haywood’s updated 2021 and 2022 estimates.
Information for this briefing was found via Sedar and Refinitiv. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
