Investors looking to catch the next wave of development with the still-evolving cannabis sector should be keeping an eye on Canadian health and wellness retailer Shiny Health & Wellness (Shiny Health & Wellness Stock Quote, Charts, News, Analysts, Financials TSXV:SNYB). That’s according to Echelon Capital Markets analyst Andrew Semple, who in a Thursday update added SNYB to Echelon’s Watchlist. Shiny Health & Wellness is a retailer of both legal, adult-use cannabis and pharmaceutical products, owning a line of licensed adult-use pot shops through its subsidiary Shiny Bud and pharmacies through subsidiary mihi Health & Wellness. Semple said SNYB has developed one of the larger cannabis retail networks in Ontario with a unique focus on smaller communities typically underserved by other outfits, namely, those customers interested in the intersection of cannabis and health and wellness. Semple said SNYB management thinks the fastest-growing category of cannabis consumers are those that use cannabis for self-reported health and wellness purposes, linking into a $308-billion market in Canada for healthcare spending. With this in mind, SNYB created a chain of retail stores that welcome all types of customers and staff who are knowledgable about the health and wellness attributes of their products. On the pharmacy side, the analyst noted management’s approach which emphasizes the expanding roles that pharmacies are playing in their communities, making for a tailwind to growth opportunities in the space. As well, pharmacy remains a fragmented space, ripe for rollup opportunities, Semple said. “We are positioning Shiny Health as a Watchlist name of interest given its differentiated retail strategy, management and the board of director’s significant depth of experience in competitive retail industries, and for fitting in with our ongoing coverage theme that positions cannabis retail as the best vertical to participate in the Canadian cannabis industry,” Semple wrote. “We are closely monitoring the Company’s progress for further revenue traction, improved earnings, execution on M&A pipeline opportunities, and securing access to additional capital resources,” he said. Last month, Shiny Health & Wellness closed on its first pharmacy acquisition, located in Cornwall, Ontario. SNYB last reported earnings in late September where its second quarter fiscal 2023 featured record revenue of $7.7 million, up 43 per cent year-over-year, and an adjusted EBITDA loss of $117,776 compared to a gain of $622,892 a year earlier. “We’re pleased with the solid performance from our cannabis line of business as we continue to demonstrate year-over-year revenue growth, strong gross margins, rising loyalty program enrolment, strengthened industry partnerships through our Data Program, and positive EBITDA only mid-way through our first fiscal year,” said Kevin Reed, Chairman and CEO, in a press release.