Should you sell your Trulieve Cannabis stock?

Haywood Capital Markets analyst Neal Gilmer maintained a “Buy” rating and C$15.00 target on Trulieve Cannabis (Trulieve Cannabis Corp Stock Quote, Chart, News, Analysts, Financials TRUL:CNX) in an August 6 report, after the company reported second-quarter results that matched revenue expectations but exceeded on margins. Adjusted EBITDA came in ahead of both his and consensus forecasts, driven by stronger-than-expected profitability.

Gilmer said Q3 revenue is expected to decline by a mid-single-digit percentage, reflecting typical seasonal softness in some of Trulieve’s core markets. Following the Q2 update, he revised his 2025 model to reflect this seasonality, slightly lowering revenue but raising EBITDA due to margin strength. His 2026 estimates remain largely unchanged.

“We recommend accumulating shares at current levels,” Gilmer said. “We continue to view Trulieve favourably in the U.S. market. The company has strategically expanded its footprint to attractive markets. The company has returned to driving annual growth the past few quarters and has been able execute on growth initiatives which is clearly evident with its recent financial results. While margins may temper slightly from the past two quarters, we expect them to remain at very healthy levels.”

Trulieve Cannabis is a multi-state operator doing business in nine states, featuring a dominant position in Florida and market leadership positions in Pennsylvania and Arizona.

Trulieve reported Q2/25 revenue of $302.1-million, flat year over year and up 1.5% sequentially, ahead of estimates from both Haywood and consensus at $298 million. Gross margin was 60.6%, slightly below the previous quarter’s 61.5% but above Haywood’s 60% estimate. Adjusted EBITDA reached $110.6-million, topping Haywood’s expectations of $102.2-million and consensus of $103.1 million, with a margin of 36.6%, in line with Q1 and up from 35.2% a year earlier.

Operating cash flow was $86.1-million, while free cash flow came in at $74.5-million, both impacted by $4.4-million in campaign contributions. Trulieve ended the quarter with $401 million in cash, $477.9-million in notes payable, and total debt of $823.7-million including lease and construction liabilities.

Retail operations contributed $283.9-million in Q2, or 94% of Trulieve’s total revenue. While that was down slightly from last year, it was a modest improvement over Q1. Traffic increased 8% year over year and 4% quarter over quarter, and the company sold more than 12.5 million branded products, up 9% annually and 6% sequentially. Trulieve reported customer retention at 67%, and 76% among medical patients. Three new stores were opened during the quarter, bringing the national dispensary count to 231.

Trulieve expects Q3 2025 revenue to decline by a mid-single-digit percentage compared to Q2, citing typical seasonal patterns in key markets, according to Gilmer. Management also said gross margins may vary by quarter but should align with full-year 2024 levels. For the full year, Trulieve is forecasting at least $250-million in operating cash flow and $40-million in capital expenditures.

Gilmer thinks that Trulieve will do $421.0-million in Adjusted EBITDA on revenue of $1,191.1-million in fiscal 2025. He believes those numbers will deteriorate slightly to $412.4-million on revenue of $1,218.0-million in fiscal 2026.

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