Cannabis stocks have the potential to increase your wealth at an impressive rate over the next decade. While the cannabis sector continues to remain volatile, we like certain cannabis stocks like Cresco Labs (CRLBF) – but whats us the bull case for Cresco Labs stock?
The recent wave of cannabis legalization sweeping through the U.S. along with the prospect of decriminalizing or even legalizing adult-use will be key drivers for licensed producers.
Here, we take a look at Cresco Labs. This cannabis stock should certainly be on your radar right now. Yes, this cannabis stock is also trading at a deep discount according to Wall Street estimates, allowing investors to derive multi-bagger gains in the next 12 months. But whats us the bull case for Cresco Labs stock?
What is the Bull Case for Cresco Labs Stock?
Marijuana heavyweight, Cresco Labs is valued at a market cap of $2.16 billion. A vertically integrated cannabis operator, Cresco Labs currently has 40 dispensaries in 10 states and has grown its sales from $43 million in 2018 to $476 million in 2020.
Most states have a limit on the licenses they are allowed to issue and this barrier to entry allows Cresco and peers to enjoy a competitive advantage in the markets they operate in. Cresco Labs reported revenue of $210 million in Q2, a rise of 123% year over year.
It reported a net profit of $2.7 million in Q2 compared to a loss of $41 million in the prior-year quarter. Cresco expects to generate $1 billion in sales by end of 2021, making it among the first marijuana companies to reach the milestone.
Wall Street expects Cresco Labs stock to gain over 60% compared to its current trading price.
The Bull Case for Cresco Labs Stock
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