According to Stifel GMP analyst Robert Fagan, the COVID-19 pandemic is actually a “net positive” for marijuana opereator Curaleaf Holdings Inc.
Amid the COVID-19 pandemic, sales of marijuana have increased for Curaleaf and shares of the company’s stock have gained 44% in the past five days.
In its earnings call late Tuesday, Curaleaf reported that the majority of its 54 stores are operational, avoiding delivery and offering on-premising filling of cannabis orders. The company highlighted about a 20% boost in sales.
Stifel GMP analyst Robert Fagan had suggested a 30% boost in growth as a result of the COVID-19 crisis would happen. The analyst has a C$22 target price on the stock.
“All in, we continue to believe cannabis is well-positioned versus other industries to outperform on a relative basis during unknowns on the coronavirus impact and believe Curaleaf is well-positioned given the company’s strong balance sheet and a majority of its revenues coming from markets that have deemed cannabis essential,” remarked Alliance Global Partners analyst Aaron Grey on Wednesday.
Grey rates Curaleaf a buy and lowered his target price to C$12 from C$14.
According to Canaccord Genuity analyst Matt Bottomley, the state shelter-in-place orders and other shutdown measures “could very possibly create moderate-to-high headwinds for the cannabis sector depending on the length/magnitude of these measures.”
Cowen analyst Vivien Azer wrote in a note to clients this week that her team was cautious about the company’s vape sales amid COVID-19, as “medical professionals are cautioning against vaping.” Azer rates Curaleaf the equivalent of a buy and has a $7 price target on U.S. shares.