Curaleaf (OTCMKTS:CURLF) was one of the hottest cannabis stocks yesterday after some pro-cannabis news from President Joe Biden. CURLF stock has also become 0ne of the most valuable marijuana plays, with a market capitalization of more than $4 billion. Yesterday, shares closed at $6.19 per share.
All cannabis stocks rose sharply on Biden’s recent pardon decision, which has helped inspire hope for federal legalization. Similar moves in Europe have done the same. Curaleaf has been operating in Europe since 2021.
Analysts now expect rapid consolidation of the space from which large retailers like Curaleaf should benefit.
CURLF Stock and the Curaleaf Story
Curaleaf began as a medical marijuana retailer and had its initial public offering (IPO) in Canada in 2018. Since then, the company has made several acquisitions, becoming one of the largest U.S. operators in 2020 after buying Grassroots Cannabis. The company now operates in 21 states. Curaleaf has also bought companies that deal in cannabis oils and edibles; for instance, it sells topical gels under the Plant Precision brand and edibles under the name Select.
The company’s most recent acquisition — which closed this month — is Tryke. The original price for the deal last November was $286 million. However, the final price came to $181 million, based on the declining value of CURLF stock.
Curaleaf is a second-generation cannabis company. It focuses on the retail market, sells products well beyond leaf, emphasizes diversity and pushes marijuana as a wellness product.
The company had sales of over $1.5 billion in 2021, but losses of $128 million, or 18 cents per share. Curaleaf also was still unprofitable in the first half of 2022. Like other marijuana plays, CURLF stock is down significantly this year, having opened 2022 at about $9 per share.
Looking forward, Biden’s recent pardon decision comes at a good time for the company, which had $1.28 billion in debt and cash of just $241 million at the end of June. Curaleaf is in a good market position, but investors may want to see a profit before jumping into shares.
On the date of publication, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
