- Trulieve Crushed Wall Street’s Expectations After Posting Q2 2020 Revenue and Adjusted EBITDA of $120.8 Million and $60.5 Million, Respectively
- In Addition to Trulieve’s Stellar Second Quarter Earnings, the Company Also Raised its Fiscal 2020 Revenue Guidance From $380 Million – $400 Million to $465 Million – $485 Million
While 2020 may certainly be a year to forget for many Americans, it’s been a breakout year for Trulieve Cannabis (CSE: TRUL) (OTCQX: TCNNF), and the company’s very happy shareholders. On Wednesday, Trulieve released its second-quarter 2020 earnings, and the results were even better than expected.
Trulieve announced its Q2 2020 revenue came in at $120.8 million, up 26% from the previous quarter and well above the consensus analyst estimate of $106.8 million. The company posted positive adjusted EBITDA for the second quarter of $60.5 million, which also crushed the street’s forecast of $45 million.
To top things off, Trulieve reported that the company was cash-flow positive for the second straight quarter and also raised its revenue guidance for fiscal 2020 to $465 million – $485 million from its previous projection of $380 million – $400 million.
“Once again our financial results reflect our exceptional ability to grow our business quarter over quarter, through continued organic expansion of our retail footprint, while maintaining industry-leading profitability. We are pleased to be able to demonstrate strong financial performance in revenue, adjusted EBITDA and free cash flow while pivoting our business to meet the changing behaviors and needs due to COVID,” commented Trulieve CEO Kim Rivers.
“Looking ahead, we are excited about the second half of the year and will continue focusing on execution and expansion. We anticipate exceeding our goal of 68 stores and will continue our strong growth in Florida. Massachusetts is getting closer to completion and we are excited to enter that market in 2021. And, we believe the M&A pipeline and application processes underway will present new opportunities for expansion. Lastly, we are moving quickly down the path toward registering with the SEC and SOX compliances. This is a great start on our next level of strategic growth,” added Rivers.
Echelon: Trulieve’s “Blowout” Quarter
Analyst Andrew Semple of Echelon Capital summarized Trulieve’s exceptional quarter in one word, “blowout.” In his research update to clients, Semple reiterated his “Buy” rating on shares of TRUL stock while substantially increasing his price target from $23 to $33 per share. As of today’s closing price of $29.98, the Echelon analyst’s target implies a potential upside of 10%, but in reality, the upside on TRUL stock is likely much greater.
Semple expects Trulieve to generate fiscal 2020 revenue of $494 million and adjusted EBITDA of $232.7 million. In 2021, the analyst projects the company’s revenue and adjusted EBITDA to come in at $692.4 million and $315.9 million, respectively.
“Trulieve Cannabis Corp. reported blowout Q220 results that exceeded all analyst estimates on both sales and EBITDA. The company also increased 2020 guidance, which continues to look highly achievable/beatable, in our view. We have made significant recalibrations to our model to reflect the exceptional quarterly results, management’s bullish commentary, and the post-quarter momentum in industry data that suggest further growth ahead,” wrote Echelon’s Andrew Semple.
Cantor Fitzgerald: Trulieve’s Strong Earnings Driven By Florida
Pablo Zuanic, an analyst at Cantor Fitzgerald, released his updated outlook on top U.S. multi-state operators (MSOs) Trulieve (CSE: TRUL) (OTCQX: TCNNF) and Green Thumb (CSE: GTII) (OTCQX: GTBIF) (FRA: R9U2) after both companies release its Q2 financial results.
In addition to naming Trulieve and Green Thumb as his top U.S. cannabis stock picks, the Cantor analyst also reiterated his “Overweight” rating on shares of TRUL and GTII. Zuanic increased his price target on Trulieve from $47 to $50 per share and from $21 to $27 on Green Thumb. As of today’s close, the implied upside on TRUL and GTII is 66.78% and 32.35%, respectively.
“We think a fact being missed by investors is the uncapped nature of the FL market (re: stores and cultivation) for current players; in most other ‘restricted’ states, given caps, we see share dilution risk as licenses expand,” stated Cantor’s Pablo Zuanic.
“Green Thumb remains our top pick among U.S. cannabis stocks, together with Trulieve,” added Zuanic.
This U.S. Cannabis Stock Appears to Be Way Undervalued and May Actually Benefit From a Second Wave of the Pandemic
TRUL Stock Price Action & Chart
Trulieve shareholders have had plenty to cheer about in 2020 as the leading U.S. cannabis stock continues to deliver phenomenal earnings quarter after quarter. As a result, Trulieve’s stock has dominated the field in 2020 with TRUL shares currently up 98.02% YDT and 270.12% since the cannabis sector bottomed in mid-March.
Shares of Trulieve’s CSE listed TRUL stock closed today’s trading session at $29.98, up 0.27% on the day. South of the border, Trulieve’s U.S. listed TCNNF stock closed the session at $22.77, up 1.2%.
Disclosure: The Cannabis Investor does not hold a position in any of the stocks mentioned in this article.