California Cannabis Co. Plus Products, Vibe Cannabis Have Unnoticed Upside Potential Claims Viridian Capital Advisors

The cannabis industry has been booming for the last several years with many companies finally attracting much-needed attention from investors. Nevertheless, due to the nature of the industry, most of the attention is directed at the larger multi-state operators, while other quality companies are going unnoticed.

The cannabis-focused financial and strategic advisory firm, Viridian Capital Advisors, in its newest equity research report, looked at this issue and highlighted cannabis operators which, based on their opinion, have uncovered potential.

“In our view, investor awareness and a lack thereof is a key factor in the disconnected US cannabis stock valuations whereby the largest MSOs garner the most attention and thus premium valuations,” Jonathan DeCourcey, director of equity research, wrote in the report.

DeCourcey further explained that there are often high valuations for the biggest multi-state operators even though many of them have lower projected growth and a “lack of takeout potential.”

Viridian noted it will continue to highlight under-followed public U.S. cannabis companies and looked at two in this initial report: Plus Products PLPRF and Vibe Cannabis VBSCF. The report noted that both are trading at what looks like “a significantly discounted valuation,” and that both have strong chances for growth in the near term and the possibility of outperforming investor returns. 

Plus Products 

A $25 million market cap edibles brand producer, Plus Products is based in California. Here are some of its most important facts, figures, and projections from the report:

• The company’s gummies continually take top market share in the edibles category; based on Leaflink’s data, Plus’ Sour Watermelon gummy was the top-selling edibles SKU in California;
• Growth based on advanced distribution, partnership with Eaze, and new product rollouts; Furthermore, its outreach across the new states and licensing could push the upside;
• It has set up a good plan for reaching profitability, by adapting its expenses, among other initiatives;
• Viridian sees Plus Products as a possible takeout candidate in the near term from multi-state operators or brand-oriented special purposes acquisition companies;
• Discounted valuation relative to peers and merger and acquisitions exits.

Vibe Cannabis 

An $80 million market cap vertically integrated California cannabis operator, Vibe Cannabis aims to expand across other states, while also advancing its California outreach. Other important highlights from the report that reveal the company’s upside potential include:

• It is already a profitable company, with a popular line of branded products under the Hype name.
• It is launching new retail stores in California, and advancing its cultivation capacities;
• Capitalized to fund California growth projects upon recent financings;
• It has recently obtained authorization to build a cultivation facility in Massachusetts and plans vertical integration in the state in the longer run;
• Discounted valuation relative to peers based on 2021 guidance;
• Could be a takeout candidate for a multi-state operator who wants to scale in California.

At the end of Viridian's initial report on “underfollowed names” in the cannabis industry, DeCourcey listed the following companies worth mentioning:

•            1933 Industries: TGIFF;

•            Australis Corporation AUSAF;

•            Bell Rock Brands DXBRF;

•            Body & Mind BAMM;

•            C21 Investments CXXIF;

•            CLS Holdings CLSH;

•            Flower One FLOOF;

•            Grapefruit USA GPFT;

•            Harborside HBOR;

•            Halo Collective HCANF;

•            Marimed MRMD;

•            Schwazze SHWZ;

•            Terra Tech TRTC;

•            Turning Point Brands TPB.

Photo by Add Weed on Unsplash