This cannabis stock will beat the market, analyst says

Haywood Capital Markets analyst Neal Gilmer reiterated his “Buy” rating and $1.30 target price on Rubicon Organics (Rubicon Organics  Stock Quote, Chart, News, Analysts, Financials TSXV:ROMJ) in a March 24 report, saying the company remains well positioned in Canada’s premium cannabis segment and should see stronger growth and margin expansion in the second half of 2026.

Gilmer said fourth-quarter results were generally in line with expectations and the outlook remains consistent with his view, despite near-term pressure from seasonal softness and ramp-up costs tied to the Cascadia facility.

“Rubicon continues to have strong market share within the premium segment across its markets,” he said. “The company remains prudent in operating expenses with a solid balance sheet. The acquisition of the new facility will help drive continued growth next year.”

Rubicon, which focuses on premium organic cannabis products, reported Q4 2025 revenue of $16.5-million, up 15.9% year-over-year and 5.3% sequentially, ahead of Gilmer’s $16.0-million estimate. Adjusted gross margin was 32.1%, down from 33.7% in the third quarter as costs related to the Cascadia facility weighed on profitability. Adjusted EBITDA was $1.2-million, or 7.2% of revenue, slightly below Gilmer’s $1.7-million forecast.

The company used $3.3-million in cash from operations during the quarter, largely because of working capital investments, and ended the period with $4.0-million in cash and $12.1-million in debt.

Gilmer noted that Rubicon continued to gain share in several premium categories. In 2025, the company held 2.2% national market share in flower, 2.1% in pre-rolls, and 7.2% in the premium segment overall. It also ranked No. 3 in premium vapes with 18.3% share, while its Wildflower topical brand maintained the top position in Canada with 25.9% market share.

Management set a $5.0-million capital spending budget for 2026, including $2.0-million for maintenance, $1.5-million for hydrocarbon production to bring more manufacturing in-house, and $1.5-million for automation and other efficiency projects intended to support margin improvement.

Gilmer said he made only minor adjustments to forecasts following the quarter and continues to expect Cascadia to drive outsized growth later this year, with additional upside from international sales in 2027.

He also highlighted Rubicon’s strategy of tiered brand positioning.

“Rubicon is implementing the Good, Better, Best product positioning strategy as it targets the premium and above organic cannabis market segment,” he said.

Haywood forecasts Rubicon will generate $9.9-million in Adjusted EBITDA on revenue of $71.1-million in fiscal 2026, improving to $15.6-million in Adjusted EBITDA on revenue of $83.9-million in fiscal 2027.

-30-