Green Thumb Industries (CNSX:GTII) - Share price, News & Analysis

Q: What is the Fair Price of GTII when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

GTII (CA$11.08) is trading below our estimate of [[fair value]] (CA$73.77)

GTII fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	5/6
Past Performance	5/6
Financial Health	4/6
Dividends	0/6

GTII Stock Overview

Green Thumb Industries Inc. engages in manufacture, distribution, and sale of various cannabis products for medical and adult-use in the United States.

Rewards

Trading at 85% below our estimate of its fair value

Earnings are forecast to grow 37.84% per year

Earnings grew by 217.9% over the past year

Risk Analysis

Shareholders have been diluted in the past year

Green Thumb Industries Competitors

TerrAscend

CNSX:TER

CA$1.0b

DRI Healthcare Trust

TSX:DHT.UN

CA$289.8m

BioSyent

TSXV:RX

CA$96.2m

Vext Science

CNSX:VEXT

CA$55.3m

Price History & Performance

Summary of all time highs, changes and price drops for Green Thumb Industries
Historical stock prices
Current Share Price	CA$11.08
52 Week High	CA$43.28
52 Week Low	CA$10.42
Beta	1.91
1 Month Change	-23.06%
3 Month Change	-50.87%
1 Year Change	-72.40%
3 Year Change	-24.68%
5 Year Change	n/a
Change since IPO	23.80%

Shareholder Returns

	GTII	CA Pharmaceuticals	CA Market
7D	-3.6%	-1.1%	-0.4%
1Y	-72.4%	-71.4%	-2.9%

Return vs Industry: GTII underperformed the Canadian Pharmaceuticals industry which returned -71% over the past year.

Return vs Market: GTII underperformed the Canadian Market which returned -2.6% over the past year.

Price Volatility

Is GTII's price volatile compared to industry and market?
GTII volatility
GTII Average Weekly Movement	8.2%
Pharmaceuticals Industry Average Movement	11.7%
Market Average Movement	10.1%
10% most volatile stocks in CA Market	17.3%
10% least volatile stocks in CA Market	4.4%

Stable Share Price: GTII is not significantly more volatile than the rest of Canadian stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: GTII's weekly volatility (8%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2014	4,000	Ben Kovler	https://www.gtigrows.com

Green Thumb Industries Inc. engages in manufacture, distribution, and sale of various cannabis products for medical and adult-use in the United States. It offers cannabis flower; and processed and packaged products, including pre-rolls, concentrates, vapes, tinctures, edibles, topicals, and other cannabis-related products under the Beboe, Dogwalkers, Doctor Solomon’s, Good Green, incredibles, and RHYTHM brands. The company distributes its products primarily to third-party retail stores, as well as sells finished products directly to consumers in its own retail stores.

Green Thumb Industries Fundamentals Summary

How do Green Thumb Industries's earnings and revenue compare to its market cap?
GTII fundamental statistics
Market Cap	US$2.03b
Earnings (TTM)	US$94.01m
Revenue (TTM)	US$941.73m

21.6x

P/E Ratio

2.2x

P/S Ratio

Is GTII overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
GTII income statement (TTM)
Revenue	US$941.73m
Cost of Revenue	US$437.73m
Gross Profit	US$504.00m
Other Expenses	US$410.00m
Earnings	US$94.01m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.40
Gross Margin	53.52%
Net Profit Margin	9.98%
Debt/Equity Ratio	14.8%

How did GTII perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is GTII undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for GTII?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for GTII. This is calculated by dividing GTII's market cap by their current preferred multiple.
What is GTII's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$2.03b

GTII key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2.4x
Enterprise Value/EBITDA	7.6x
PEG Ratio	0.6x

Price to Earnings Ratio vs Peers

How does GTII's PE Ratio compare to its peers?

GTII PE Ratio vs Peers

The above table shows the PE ratio for GTII vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	185.3x
TER TerrAscend	710.3x	81.0%	CA$1.0b
DHT.UN DRI Healthcare Trust	9.3x	32.5%	CA$289.8m
RX BioSyent	15.9x	n/a	CA$96.2m
VEXT Vext Science	5.9x	n/a	CA$55.3m
GTII Green Thumb Industries	21.6x	37.8%	CA$2.6b

Forward PE

Price-To-Earnings vs Peers: GTII is good value based on its Price-To-Earnings Ratio (21.6x) compared to the peer average (185.3x).

Price to Earnings Ratio vs Industry

How does GTII's PE Ratio compare vs other companies in the North American Pharmaceuticals Industry?

Price-To-Earnings vs Industry: GTII is expensive based on its Price-To-Earnings Ratio (21.6x) compared to the Canadian Pharmaceuticals industry average (8.4x)

Price to Earnings Ratio vs Fair Ratio

What is GTII's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

GTII PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	21.6x
Fair PE Ratio	47.4x

Price-To-Earnings vs Fair Ratio: GTII is good value based on its Price-To-Earnings Ratio (21.6x) compared to the estimated Fair Price-To-Earnings Ratio (47.4x).

Share Price vs Fair Value

What is the Fair Price of GTII when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: GTII (CA$11.08) is trading below our estimate of fair value (CA$73.77)

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

Price to Earnings Growth Ratio

PEG Ratio: GTII is good value based on its PEG Ratio (0.6x)

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Future Growth

How is Green Thumb Industries forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

37.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: GTII's forecast earnings growth (37.8% per year) is above the savings rate (1.6%).

Earnings vs Market: GTII's earnings (37.8% per year) are forecast to grow faster than the Canadian market (7.5% per year).

High Growth Earnings: GTII's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: GTII's revenue (25.3% per year) is forecast to grow faster than the Canadian market (7% per year).

High Growth Revenue: GTII's revenue (25.3% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: GTII's Return on Equity is forecast to be low in 3 years time (19.4%).

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Past Performance

How has Green Thumb Industries performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

60.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: GTII has high quality earnings.

Growing Profit Margin: GTII's current net profit margins (10%) are higher than last year (4.6%).

Past Earnings Growth Analysis

Earnings Trend: GTII has become profitable over the past 5 years, growing earnings by 60.2% per year.

Accelerating Growth: GTII's earnings growth over the past year (217.9%) exceeds its 5-year average (60.2% per year).

Earnings vs Industry: GTII earnings growth over the past year (217.9%) exceeded the Pharmaceuticals industry 118.1%.

Return on Equity

High ROE: GTII's Return on Equity (6%) is considered low.

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Financial Health

How is Green Thumb Industries's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: GTII's short term assets ($328.4M) exceed its short term liabilities ($179.2M).

Long Term Liabilities: GTII's short term assets ($328.4M) do not cover its long term liabilities ($563.0M).

Debt to Equity History and Analysis

Debt Level: GTII's net debt to equity ratio (4.2%) is considered satisfactory.

Reducing Debt: GTII's debt to equity ratio has increased from 13.7% to 14.8% over the past 5 years.

Debt Coverage: GTII's debt is well covered by operating cash flow (60.5%).

Interest Coverage: GTII's interest payments on its debt are well covered by EBIT (10.2x coverage).

Balance Sheet

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Dividend

What is Green Thumb Industries's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

Dividend Yield vs Market

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

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

Stability and Growth of Payments

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

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

Earnings Payout to Shareholders

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

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as GTII has not reported any payouts.

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Management

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

2.4yrs

Average management tenure

CEO

Ben Kovler (42 yo)

8.42yrs

Tenure

US$1,714,256

Compensation

Mr. Benjamin Kovler, also known as Ben, Founded Green Thumb Industries Inc. in 2014 and has been its Chairman and Director since 2014. Mr. Kovler has been the Chief Executive Officer of Green Thumb Industr...

CEO Compensation Analysis

Compensation vs Market: Ben's total compensation ($USD1.71M) is about average for companies of similar size in the Canadian market ($USD2.38M).

Compensation vs Earnings: Ben's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: GTII's management team is considered experienced (2.4 years average tenure).

Board Members

Experienced Board: GTII's board of directors are considered experienced (4.7 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: Insufficient data to determine if 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 diluted in the past year, with total shares outstanding growing by 6.3%.

Data	Last Updated (UTC time)
Company Analysis	2022/06/29 00:00
End of Day Share Price	2022/06/28 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31