Verano Q4 Financial Metrics Down; Wall Street Analysts Forecast Sizeable Upside

This article provides insights into the Verano (VRNOF) company, its latest (Q4) financial results, its stock performance YTD and the consensus 12-month forecast of 13 Wall Street analysts.

About Verano

Verano Holdings Corp. operates as a vertically integrated multi-state cannabis operator in the United States. It engages in the cultivation, processing, wholesale, and retail distribution of cannabis.

• has a $997.4 market cap as of March 30th;
• operates in 13 states with
  • 125 dispensaries of which 66 are in Florida representing 12% of the total dispensaries there; 16 in Pennsylvania; 10 in Illinois; 6 in Arizona and 27 in the other 9 states and
  • 14 cultivation and production facilities (2 each in FL, Ax, and PA and none in MI or AR)

• For more detailed information go here.

Q4 Financial Information

(All currency numbers are in USD and compared to the previous quarter.)

• Revenue: DOWN 0.7% to $225.9M
• Gross Profit: DOWN 16.0% to $103.3M
  • as % of revenue: DOWN to 45.7% from 54.0%
• SG&A Expense: DOWN 5.8% to $81.0M
  • as a % of revenue: DOWN to 34.8% from 36.1%
• Adjusted EBITDA: DOWN 4.1% to $78.7M
  • as a % of revenue: DOWN to 34.8% from 36.1%
• Net Profit (Loss): UP 402.6% to $(216.1)M*
  • *includes a $229M impairment charge
• For a detailed look at all the financial metrics related to Verano in the last quarter and for every year going back to 2018 go here.

Q4 Operational Highlights

• Refinanced $350 million credit facility with enhanced flexibility to reduce capital costs.
• Opened three new MÜV dispensary locations in Florida.

• Launched BITS^™, a new brand and product line consisting of five unique flavors of low-dose, high-function edibles that blend THC, cannabinoids and adaptogens.

Stock Performance

Verano's stock price declined 75.5% in 2022 which was slightly more than the 72.5% experienced by the other 11 constituents in the munKNEE American Cannabis MSOs Index. Its stock price has declined 8.7% YTD (as of the close of business on March 30th, 2023) as compared to a 15.5% decline in the MSO Index (excluding VRNOF).

Analyst Forecasts

According to 13 stock analysts, the average 12-month stock price forecast for VRNOF stock is $12.50, which represents an increase of 331.0% from its March 30th close. 10 analyst rate the stock as a Strong Buy and 2 as a Buy and one as a Hold. Source

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