Exploring Florida’s Cannabis Market Growth
A recent equity research report shines a light on Planet 13 Holdings’ bold move into the Florida market. With the acquisition of VidaCann, the company exhibits a keen focus on capitalizing on potential recreational cannabis legalization by mid-2026. Investors are taking note, with the stock already up 26% in the last 30 days, as interest in its Florida operations grows amidst anticipation of Amendment 3 appearing on the November 2024 ballot.
Expansion Strategies in the Sunshine State
Planet 13’s acquisition of VidaCann for $63.4 million has paved the way for significant growth opportunities in Florida. The company’s plan to open six additional stores before 2024 concludes, with three imminent launches, including one in Ocala. By rebranding VidaCann stores under the Planet 13 banner and introducing new product offerings like HaHa edibles, the company aims to strengthen its presence in the region.
Metrics and Projections for Growth
In the second quarter of 2024, VidaCann stores exhibited promising metrics, selling an average of 1.86K ounces of flowers per store, marking a noteworthy 120% year-over-year increase. Despite this progress, the figures still fall short of the state average. Extract volumes per store also saw a 30% year-over-year growth, hinting at positive momentum, though room for improvement remains to match state averages. With Zuanic estimating a potential combined annual revenue of over $70 million by closing the existing performance gap, the outlook for growth appears promising.
Financial Prospects and Valuation
With Florida poised to be a key driver of Planet 13’s revenue and profit growth, the company’s gross margins in the state at 50% present substantial opportunities for enhancement through operational efficiencies. Forecasts suggest that in the scenario of Florida moving towards recreational sales by mid-2026, Planet 13 could attain an impressive annual sales run rate of $225 million by the year’s end. This could elevate the enterprise value to $450 million, potentially doubling the current share price to $1.30.
Keep updated on how Planet 13 navigates the evolving cannabis landscape, as it aims to leverage Florida’s budding potential.