The US's Curaleaf Holdings (CSE:CURA) (OTCQX:CURLF) is climbing today. Up 8% and selling for $9.04 USD at present, the fifth largest cannabis firm by market cap ($4.04 billion USD) has been on investors' radars since 2019 kicked off.
Curaleaf Holdings: What's to Like?
Like many of its peers, the company suffered hard in late 2018 from a wider-market selloff that hit the cannabis sector. But after hitting a low of $4.02 in December, CURLF stock has since doubled in value.
Moving into 2019, the momentum continues, and now we are seeing Curaleaf define itself as a true investment pick. The pre-legalization hype that surrounded cannabis is over, business is in full swing, and thriving companies are doing so on metrics and positive operational achievements.
Curaleaf Holdings ticks these boxes and investors have noticed.
One of the company's biggest achievements so far this year came as a surprise to many. Grocery superstore CVS (NYSE:CVS) announced that it would stock Curaleaf's CBD-infused products in its stores across eight US states. Products include creams, sprays, roll-ons, lotions, and salves.
This deal puts Curaleaf's products in over 800 stores across America.
The company's recent earnings report also boosted sentiment around Curaleaf stock. The company has grown revenue by more than 400% year-over-year. Revenue rose to $32 million from $6.3 million in the year-ago period.
Further, according to MarketWatch:
"The company reported fourth-quarter net losses of $16.5 million, or 4 cents a share, compared with profits of $624,000, or zero cents a share in the year-ago quarter."
Acquisitions and Future Potential
Curaleaf made two recent acquisitions that have turned analysts bullish. It acquired California's Eureka and Nevada's Acres. These two acquisitions secure the company a foothold in the largest cannabis markets in the US. Potential here is massive with numbers already proving so in recent months.
Seaport Global Securities analyst Brett Hundley said the following:
“We like Curaleaf’s recent acquisition announcements of Eureka in [California] and Acres in [Nevada], and we believe that management is taking a differentiated longer-term view on the [California] market, which could allow it to better protect margins relative to its peers in this important state.”
Currently, Hundley has given Curaleaf a buy rating with a price target of $10. He is not alone. Elsewhere, GMP Securities analyst Robert Fagan says:
"Should all pending acquisitions from 2018 close as expected, we suspect there could even be some upside to this guidance.”
And he, subsequently, has set a buy rating on Curaleaf and a price target of $21.
Going from strength to strength and at under $10 per share, could Curaleaf be considered undervalued? What do you think? Is this cannabis stock a play?
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