Green Thumb Industries has lots of upside, GMP Securities says

Actions speak louder than words and that holds for execution in the cannabis space as well, where US cannabis play Green Thumb Industries (Green Thumb Industries Stock Quote, Chart CSE:GTII) has just closed on the purchase of Nevada-based operator Integral Associates, doing business as Essence.

Remarking on the event, GMP Securities analyst Robert Fagan says it helps confirm GTII as one of the strongest operators in the cannabis space.

Essence —which currently operates three stores in the Las Vegas area, two production facilities in Nevada totaling approximately 95,000 square feet, eight additional licenses in NV as well as one in West Hollywood— represents a major win for GTI shareholders, says Green Thumb found and CEO Ben Kovler.

“Integral Associates is an exceptional operator—it is a highly admired and respected business and adds award-winning products, significant retail market share, and healthy EBITDA to our business. This acquisition is immediately accretive and an important milestone as we position GTII to scale in one of the only limited license adult use markets,” Kovler said in a press release.

Fagan is calling the impact of the event positive, saying that although Essence’s contributions have been factored into his GTII forecast, the company’s additional licenses in Nevada and California have not, and thus, there is potentially significant upside to follow.

“We note GTII has successfully acquired Essence without incurring delays, and one month earlier than we expected, in a state (NV) that is notoriously difficult to pass regulatory approval. We believe this further cements GTII’s strong execution track-record, supporting our view of the company being amongst the strongest operators in the industry,” said Fagan in a client update on Wednesday.

The analyst is reiterating his “Buy” rating and C$32.00 target for GTII, which represented a projected return of 107.8 per cent at the time of publication.