Business course

Growth and business structure puts cannabis producer Trulieve on the right track

At first glance, it seems repetitive to say that every company in the cannabis industry is waiting for federal legislation in the United States that will legalize marijuana. But it’s the only show in town when it comes to this area. So much depends on it. And the fate of so many companies will be determined by their fate once this mega market opens up.

This is why so many investors are very attentive to the positioning of these companies in order to take advantage of the game-changing opportunity when it presents itself. And the clock is ticking louder and louder as this eventuality draws closer.

One company that seems well prepared is Trulieve (OTC 🙂 (CSE :). The Florida-based cannabis producer has shown steady growth and has a good corporate structure.

Shares of Trulieve peaked on news of its latest, released last week, hitting a recent high of $ 33.61. But they have since retreated somewhat, closing yesterday at $ 27.40, down about 5.5% on the day.

Yet over the past year, the stock has gained over 16.5%. That’s an impressive move in a tough market that could see big winners down the road.

Here’s what makes Trulieve rule:

Let’s take a look at its growth first.

Last week, the company unveiled its latest quarterly profit, which posted a 64% year-over-year revenue gain. That figure now stands at $ 224.1 million. The gain exceeded analysts’ expectations.

The company’s gross profit also made substantial gains, jumping 68.7% to $ 153.9 million for the most recent quarter ended September 30. This is up from $ 102.2 million in the same quarter last year.

Its profit also jumped 7% to $ 18.6 million for the quarter, despite a one-time write-down in transition costs of $ 16.4 million.

Now let’s take a look at the structure of the company.

The company is one of the few US-based jar companies to be vertically integrated, which means it controls the entire process, from growing to marketing what consumers buy. It is also a multistate operator. This allowed the business to grow steadily where it could. And that’s exactly what he managed to do. Today, it is the largest cannabis retailer in the United States.

Trulieve left its roots as a medical marijuana business and branched out to take a leading role in the leisure market.

It also develops in other ways. Last month, he finalized his $ 2.1 billion purchase of Harvest Health and Recreation, a medical marijuana company. That’s where its recent one-time $ 16.4 million depreciation comes in.

But the new acquisition is already growing. In the last quarter, Trulieve opened 13 new dispensaries under the Harvest banner. Together, they operate 155 stores and 3.5 million square feet of grow space.

Vertical integration, like the large Canadian operators, puts Trulieve in a better position to take full advantage of the opportunity to grow when federal legalization takes effect. It is on the verge of being able to control its inventory and expand its retail business.