TSX:ALEF

Stock Analysis Report

Executive Summary

Aleafia Health Inc. operates as an integrated cannabis health and wellness company.

Rewards

Trading at 89.9% below its fair value

Earnings are forecast to grow 78.81% per year

Revenue grew by 391% over the past year

Risk Analysis

Shareholders have been substantially diluted in the past year

Has less than 1 year of cash runway

Highly volatile share price over past 3 months

Does not have a meaningful market cap (CA$113M)



Snowflake Analysis

High growth potential and fair value.

Share Price & News

How has Aleafia Health's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ALEF's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

24.6%

ALEF

10.7%

CA Healthcare

11.7%

CA Market


1 Year Return

-78.6%

ALEF

-41.2%

CA Healthcare

-26.0%

CA Market

Return vs Industry: ALEF underperformed the Canadian Healthcare industry which returned -41.2% over the past year.

Return vs Market: ALEF underperformed the Canadian Market which returned -26% over the past year.


Shareholder returns

ALEFIndustryMarket
7 Day24.6%10.7%11.7%
30 Day-19.0%-22.4%-21.9%
90 Day-32.5%-24.8%-26.6%
1 Year-78.6%-78.6%-39.6%-41.2%-23.6%-26.0%
3 Yearn/a-49.3%-55.4%-15.8%-23.6%
5 Yearn/a-20.0%-37.9%-3.5%-17.8%

Price Volatility Vs. Market

How volatile is Aleafia Health's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Aleafia Health undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ALEF (CA$0.41) is trading below our estimate of fair value (CA$3.99)

Significantly Below Fair Value: ALEF is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ALEF is unprofitable, so we can't compare its PE Ratio to the Healthcare industry average.

PE vs Market: ALEF is unprofitable, so we can't compare its PE Ratio to the Canadian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ALEF's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ALEF is good value based on its PB Ratio (0.3x) compared to the CA Healthcare industry average (1.8x).


Next Steps

Future Growth

How is Aleafia Health forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

78.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ALEF is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.4%).

Earnings vs Market: ALEF is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: ALEF's is expected to become profitable in the next 3 years.

Revenue vs Market: ALEF's revenue (32.2% per year) is forecast to grow faster than the Canadian market (3.9% per year).

High Growth Revenue: ALEF's revenue (32.2% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ALEF's Return on Equity is forecast to be low in 3 years time (6.1%).


Next Steps

Past Performance

How has Aleafia Health performed over the past 5 years?

-113.7%

Last years earnings growth


Earnings and Revenue History

Quality Earnings: ALEF is currently unprofitable.

Growing Profit Margin: ALEF is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if ALEF's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Unable to compare ALEF's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: ALEF is unprofitable, making it difficult to compare its past year earnings growth to the Healthcare industry (2.7%).


Return on Equity

High ROE: ALEF has a negative Return on Equity (-10.3%), as it is currently unprofitable.


Next Steps

Financial Health

How is Aleafia Health's financial position?


Financial Position Analysis

Short Term Liabilities: ALEF's short term assets (CA$117.6M) exceed its short term liabilities (CA$20.7M).

Long Term Liabilities: ALEF's short term assets (CA$117.6M) exceed its long term liabilities (CA$57.1M).


Debt to Equity History and Analysis

Debt Level: ALEF's debt to equity ratio (13.3%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if ALEF's debt to equity ratio has reduced over the past 5 years.


Balance Sheet

Inventory Level: ALEF has a high level of physical assets or inventory.

Debt Coverage by Assets: ALEF's debt is covered by short term assets (assets are 2.3x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: ALEF has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if ALEF has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


Next Steps

Dividend

What is Aleafia Health's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate ALEF's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate ALEF's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ALEF's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ALEF's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ALEF's dividend in 3 years as they are not forecast to pay a notable one for the Canadian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.6yrs

Average management tenure


CEO

Geoff Benic

1.75s

Tenure

CA$191,783

Compensation

Mr. Geoffrey Benic, also known as Geoff, has been Chief Executive Officer of Aleafia Health Inc since June 28, 2018. Previously, Mr. Benic served as the Regional Director of United Parcel Service Canada Lt ...


CEO Compensation Analysis

Compensation vs Market: Geoff's total compensation ($USD136.27K) is about average for companies of similar size in the Canadian market ($USD159.52K).

Compensation vs Earnings: Insufficient data to compare Geoff's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Geoffrey Benic
Chief Executive Officer1.75yrsCA$191.78kno data
Benjamin Ferdinand
CFO & Corporate Secretary1.58yrsCA$170.94kno data
Michael Verbora
Chief Medical Officer1.92yrsCA$111.22k0.062% CA$69.7k
Greg Rossi
Chief Operating Officer1.58yrsno datano data
Trevor Newell
Chief Marketing & Technology Officer1.58yrsno datano data
Nicholas Bergamini
Vice President of Investor Relations & Public Affairsno datano data0.0056% CA$6.3k
Geoff Smith
General Counsel1yrno datano data
Dave Shepherd
Vice President of Human Resources1.17yrsno datano data
Keith White
President of Clinic Operations1yrno datano data
Rob Tyrie
Head of FoliEdge Academy0.92yrno datano data

1.6yrs

Average Tenure

Experienced Management: ALEF's management team is not considered experienced ( 1.6 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Daniel Milliard
Independent Director1yrno datano data
Lea Ray
Lead Independent Director0.42yrno datano data
Loreto Grimaldi
Independent Director1yrno data0.0030% CA$3.4k
Julian Fantino
Chairman of the Board2yrsCA$847.29k1.62% CA$1.8m
Raf Souccar
Director2yrsCA$729.70k1.62% CA$1.8m
William Stewart
Independent Director1.83yrsno data0.18% CA$206.5k
Mark Sandler
Independent Director1.92yrsno datano data

1.8yrs

Average Tenure

63yo

Average Age

Experienced Board: ALEF's board of directors are not considered experienced ( 1.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: ALEF insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 84%.


Top Shareholders

Company Information

Aleafia Health Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Aleafia Health Inc.
  • Ticker: ALEF
  • Exchange: TSX
  • Founded:
  • Industry: Health Care Facilities
  • Sector: Healthcare
  • Market Cap: CA$112.547m
  • Shares outstanding: 277.89m
  • Website: https://www.aleafiahealth.com

Number of Employees


Location

  • Aleafia Health Inc.
  • 8810 Jane Street
  • 2nd Floor
  • Concord
  • Ontario
  • L4K 2M9
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ALEFTSX (The Toronto Stock Exchange)YesCommon SharesCACADMar 2018
ALEA.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDMar 2018
ARAHDB (Deutsche Boerse AG)YesCommon SharesDEEURMar 2018

Biography

Aleafia Health Inc. operates as an integrated cannabis health and wellness company. It produces a portfolio of products, including dried flower and pre-rolls, as well as oil drops and capsules, and oral sprays. The company offers its products under the Emblem and Symbl brands. It also operates a network of 25 medical cannabis clinics; and education centers. Aleafia Health Inc. is headquartered in Concord, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 04:43
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.