HEXO (HEXO Stock Quote, Chart TSX:HEXO) is getting a target price raise from analyst Russell Stanley of Beacon Securities, who rates the stock as a “Buy” (unchanged) with a target of $12.25 (was $11.00).
In a Tuesday update to clients, Stanley pointed to the cannabis company’s new NYSE listing and recent financing announcements as cause for the target raise.
Gatineau, Quebec’s HEXO announced in late January a marketed offering of 8.9 million shares at $6.50 per share, with net proceeds of approximately $54.7 million, to go towards general corporate purposes such as global growth initiatives and R&D.
As well, the company announced last week that it had entered into a syndicated credit facility co-led by CIBC and Bank of Montreal, with proceeds to go towards expansion of its cultivation and production facility in Gatineau as well as leasehold improvements at its Belleville, Ontario, facility.
As a result, Stanley has upped his multiple for HEXO from 20x to 23x his EV/2020 EBITDA estimate.