Cabot Cannabis Investor Issue: May 28, 2025

The Senate Judiciary Committee recently approved the nomination of Terrance Cole to lead the Drug Enforcement Administration (DEA).

The full Senate may vote on Cole’s confirmation as soon as early June.

This could be the start of a significant turning point for cannabis stocks. That’s because Cole will address a Biden-era proposal to move cannabis to Schedule III from Schedule I under the Controlled Substances Act (CSA). The change would significantly enhance cannabis company cash flow by neutralizing an IRS rule that bars operating expense deductions against revenue from the sale of Schedule I substances.

We can expect DEA action on rescheduling fairly soon because Cole said it would be a top priority as DEA head. The bad news is that Cole stopped short of indicating the extent to which he supports the rescheduling.

On the bright side, recall that President Donald Trump campaigned on getting the reform done. While Trump has begun to betray voters on “promises made, promises kept” (he failed to get no tax on Social Security in the “big beautiful” spending bill) we recently got two incremental signs the administration may be serious about cannabis law reform.

The signals came in the form of an administration hire of a prominent drug law reform attorney, and a rare DEA waiver allowing a church to use psychedelics in religious ceremonies (see details below).

What To Do Now

Cannabis investors remain uncertain about when reform like rescheduling will happen. It is not possible to predict this with any accuracy. So, patience is required. It makes sense to make the wait easier with a “get paid to wait” strategy, which emphasizes cannabis sector lenders that pay rich yields. They will still post some capital appreciation if reform progresses.

Our Cabot Cannabis Insider portfolio now has three of these. They are: Advanced Flower Capital (AFCG), Chicago Atlantic Real Estate Finance (REFI) and Chicago Atlantic BDC (LIEN). They pay yields of 18.7%, 12.9% and 13.1%, respectively.

In dividend investing, yields like these are often considered “too high” and a sign they cannot last. At least as of the most recent updates, it does not appear these dividends will be cut. All have recently affirmed their dividend payouts.

Otherwise, continue to hold or average down in our main portfolio names. The best time to buy stocks is when they are widely hated, but plausible catalysts lie on the horizon. That is clearly the case with cannabis stocks now. But this is also the hardest time to buy stocks. That resistance may also be a signal to buy. As a general rule, some of your best stock purchase decisions will be the ones that are the hardest to make.

Consider taking both trading positions and multiyear positions in portfolio names now, or averaging down. I am personally averaging down in the current weakness.

Portfolio names are: Ayr Wellness (AYRWF), Cresco Labs (CRLBF), Curaleaf (CURLF), Cronos (CRON), AdvisorShares Pure U.S. Cannabis (MSOS), AdvisorShares MSOS 2X Daily (MSOX), ETFMG Alternative Harvest (MJ), Green Thumb (GTBIF), Organigram (OGI), Tilray Brands (TLRY), Trulieve (TCNNF) and Verano (VRNOF). For simplicity, consider getting exposure via MSOS or the leveraged version, MSOX.

Cannabis News from Around the World

Part of my core thesis for being bullish on cannabis stocks is that there continues to be tremendous cultural momentum toward cannabis reform around the world. I’m convinced institutional investors will not ignore cannabis stocks forever.

We see evidence of this powerful cultural momentum in the changes in laws to legalize cannabis, big tobacco investments in the space, robust cannabis sales growth in states that legalize, increased cultural acceptance in the form of relaxed drug testing standards in sports leagues and the workplace, and poll results that show a growing majority of people support legalization regardless of age and party affiliation.

These trends tell us cannabis stocks are a strong contrarian buy that will turn very profitable for patient investors with a medium-term horizon. The sector is so volatile, it is easy to get shaken out of names by heightened emotional reaction to drawdowns. So, it is important to catalogue evidence of this cultural momentum. That is the purpose of this section of Cabot Cannabis Investor.

National news

* The Trump administration recently signaled it may be serious about promoting cannabis-friendly policies -- by hiring a prominent drug law reform advocate as a senior attorney.

The U.S. Department of Health and Human Services (HHS) recently hired Yetter Coleman partner Matt Zorn as deputy general counsel. An intellectual property and antitrust lawyer, Zorn has also filed several drug-reform lawsuits against the federal government.

This hire is an incremental positive for cannabis stocks.

On the bright side, Zorn has long been an advocate of increasing access to cannabis for medical use and research. So, the fact that he was hired can be read as an administration policy statement that it favors improving access to Schedule I drugs for medical use and research.

For example, in an interview with Montel Williams Zorn described Controlled Substance Act (CSA) placement of cannabis in Schedule I as a “sham.” The problem, he says, is that to maintain Schedule I status, a drug has to have no currently accepted medical use.

“Nobody in their right mind would ever think that cannabis does not have an accepted medical use,” said Zorn in the Williams interview. As evidence, he cites the fact that in practice plenty of doctors recommend cannabis to thousands of patients who use cannabis for medical reasons in the forty states where this is legal.

“I would call it a fraud on the American public where there is administrative law that rigged the deck so it is impossible to prove cannabis is safe and effective, by not letting people study cannabis.” Moving cannabis to Schedule III from Schedule I would improve medical access and allow more research on medical use.

The negative for cannabis investors here is that HHS mostly likely hired Zorn to try to help find ways to improve medical access to psychedelics, not cannabis. HHS Secretary Robert F. Kennedy Jr. has been an open advocate of exploring the use of psychedelics to treat mental disorders like PTSD and traumatic brain injury, as has Veterans Affairs secretary Doug Collins and Food and Drug Administration head Marty Makary.

One bullish angle for cannabis investors is that if Zorn helps find a legal pathway that improves access to psychedelics for research and medical use, the same logic could be applied to cannabis. President Donald Trump campaigned on moving cannabis to Schedule III to improve access for medical use. Kennedy said during his presidential campaign that he would legalize cannabis and psychedelics if elected.

* As mentioned above, the Senate Judiciary Committee approved the nomination of Terrance Cole to lead the Drug Enforcement Administration (DEA). The appointment is key for cannabis investors because Cole will address a Biden-era proposal to move cannabis to Schedule III from Schedule I under the Controlled Substances Act. The change would significantly enhance cannabis company cash flow by neutralizing an IRS rule that bars operating expense deductions against revenue from the sale of Schedule I substances.

In his confirmation hearing, Cole said rescheduling would be one of his first priorities. “I know the process has been delayed numerous times, and it’s time to move forward,” he said. However, Cole stopped short of indicating the extent to which he supports the rescheduling. Instead, he said he would examine the science, assess progress so far, and consult with experts before deciding.

Ultimately, policy direction will likely have to come from President Donald Trump. He endorsed rescheduling during his election campaign. Since then, he has not publicly addressed the topic, raising some doubts among cannabis sector analysts about whether he will actually follow through.

However, for a clue on how serious Trump is about rescheduling, it’s worth pointing out that his first choice for DEA head was Florida Sheriff Chad Chronister, who strongly favors cannabis decriminalization. Chronister withdrew for reasons unrelated to his views on cannabis reform.

The full Senate could vote on Cole’s confirmation as soon as early June.

* The Drug Enforcement Administration (DEA) appears to have softened its stance on psychedelics. A church in Washington says the agency recently gave it permission to use the psychedelic ayahuasca in religious ceremonies.

The approval may signal a policy change at the DEA. From 2016-2024 the DEA reported that 24 petitioners had requested a religious exemption for various controlled substances, but as of early 2024 it had granted none of them, according to the Government Accountability Office (GAO).

The Church of Gaia made the request under the Religious Freedom Restoration Act (RFRA), which gives churches a way to request exceptions under the Controlled Substances Act (CSA).

The church claims ayahuasca is a ceremonial tool for accessing spiritual connection. “Ayahuasca is not just a plant, but a portal to understanding oneself, nature, and the interconnectedness of all,” says the church.

* A majority of veterans and their family members think the Department of Veterans Affairs (VA) should provide access to medical cannabis. The poll was conducted by Mission Roll Call, a nonprofit that represents veterans.

* Cannabis sector sales grew 4.5% last year to $30.1 billion, but employment fell by 3.4%, according to a Cannabis Jobs Report published by Vangst, a research group. The trend reflects cost-cutting efforts by cannabis companies struggling with ongoing price compression, offset by unit sales growth.

Not surprisingly, employment declines were biggest in more mature markets like Illinois, California and Colorado, and employment gains were largest in emerging markets like New York, and Ohio. The group forecasted 13% sales growth this year to $34 billion. The U.S. cannabis supports 425,002 full-time equivalent jobs, says the report.

State news

* A cannabis reform group in Florida has joined forces with a health care lobbyist to challenge new state rules which make it harder to put referenda on the ballot.

The cannabis reform group Smart & Safe Florida recently joined a lawsuit by Medicaid reform advocate Florida Decides Healthcare that challenges the new rules.

The new rules ban the use of out-of-state residents to collect petition signatures, require additional personal information from voters signing petitions, and require petition forms to include a financial impact statement from a state panel.

Smart & Safe Florida supported a 2024 initiative to legalize recreational use cannabis in the state. The referendum just missed getting the required 60% support of voters. Smart & Safe Florida was mainly funded by Trulieve (TCNNF), a big medical cannabis supplier in the state. Smart & Safe Florida is currently gathering petitions to put the initiative on the ballot in 2026.

* States continue to endorse cannabis-friendly policy by regulating hemp sales instead of banning them. Alabama Republican Gov. Kay Ivey signed a bill that permits the sale of hemp-derived cannabis products. The bill bans some types of products and puts a 10% sales tax on the rest.

Alabama’s law says edible hemp products cannot exceed 10 milligrams of THC per serving or 40 milligrams per container. Beverages are limited to 10 milligrams of THC per serving. Topicals, sublinguals and other product categories are limited to 40 milligrams of THC per container. The law bans smokable products, product that contains “psychoactive cannabinoids” created by chemical synthesis, like delta-8 THC, which can be created from CBD. The bill goes into effect July 1.

The 2018 Farm Bill legalized hemp plants that contain 0.3% delta-9 THC or less. The Farm Bill does not regulate hemp-derived cannabis products. So, sales are legal unless states prohibit the products. States across the country are grappling with this issue now, and reform of the Farm Bill could shut down the hemp-derived cannabis product loophole.

Hemp farmers cultivated 45,294 acres of the crop last year, up 64% from 2023, says the National Hemp Report from the U.S. Department of Agriculture.

* The Texas House of Representatives recently passed a bill that would expand the state’s medical cannabis program. Called HB 46, the law would add qualifying conditions including chronic pain, glaucoma, traumatic brain injury, spinal neuropathy, Crohn’s disease, degenerative disc disease and any terminal illness for which patients are receiving hospice or palliative care. Military veterans would be eligible to use cannabis for any medical condition.

The legislation would increase the number of medical cannabis stores by 11. The bill would also expand delivery mechanisms to include vaporizers, nebulizers, topicals and patches.

* New York City has shuttered nearly 1,400 illegal cannabis shops and seized more than $95 million worth of illegal products in the past year, as part of its “Operation Padlock to Protect.” The ongoing enforcement should support sales at legally licensed stores.

Medical news

It’s important for cannabis investors to track evidence of effective medical use of cannabis, since this supports federal-level reform and legalization efforts. Studies that show medical benefits are important because they support moving cannabis to Schedule III from Schedule I under the Controlled Substances Act.

* Cannabis may help treat sleep apnea. About 40% of sleep apnea patients enrolled in Minnesota’s medical cannabis access program experienced significant and sustained sleep improvement after using medical cannabis products, says the Minnesota Office of Cannabis Management (OCM). Over half of the patients with severe fatigue reported significant improvements in their symptoms. Over a third of patients who reported depression or anxiety showed improvement.

“These numbers show meaningful changes in disturbed sleep and fatigue for patients after starting medical cannabis,” said OCM Senior Researchers Grace Christensen. “Obstructive sleep apnea can affect a patient’s mental health and physical health, so helping patients treat their symptoms can have a holistic outcome on their wellbeing.”

* Cannabinoids can increase the efficacy of chemotherapy drugs and minimize side effects, according to a recent meta-analysis of studies conducted by researchers at the Institute of Pharmacology and Toxicology at Rostock University Medical Center, in Germany. The study was published in the journal Pharmacology & Therapeutics.

* Cannabinol may enhance the efficacy of a breast cancer chemotherapy called exemestane, by suppressing the creation of cancer-promoting hormones, according to a new study.

The combination was more effective at preventing the expression of aromatase, an enzyme that plays a key role in the body’s production of a hormone that can promote cancer cell growth. The study was published in the European Journal of Pharmacology.

* Cannabidiol (CBD) may improve the anti-cancer activity of a chemotherapy called etoposide, in patients with non-small cell lung cancer (NSCLC). The combination upregulates genes associated with autophagic cell death while downregulating oncogenes that drive tumor progression.

“The findings suggest that the combination of CBD with etoposide could represent a groundbreaking approach to NSCLC treatment, particularly in cases where conventional therapies fail,” says the study. “By inducing autophagic cell death and inhibiting oncogenic pathways, this therapeutic strategy offers a promising new avenue for enhancing treatment efficacy in NSCLC.” The study was published in the journal Experimental & Molecular Medicine.

* Cannabis use may help protect brain activity in HIV patients, according to a recent study from the University of Nebraska and Creighton University. The study found that people with HIV who used cannabis had stronger gamma oscillatory responses and more normal gamma activity compared to HIV patients who did not use cannabis. Gamma oscillatory responses are neural activity crucial for cognitive function like perception, movement, memory, and emotion. “These findings provide new evidence that cannabis use may mitigate the harmful effects of HIV on oscillatory and spontaneous gamma activity,” concludes the study.

Portfolio Company News

Curaleaf (CURLF)

Curaleaf continued to expand in Europe this month by launching medical cannabis strains in Austria. The products will be distributed by a wholesaler called Canngea. Curaleaf said it will launch more strains and a vape device.

“Australia is an exciting and rapidly evolving market, expected to surpass $1 billion in annual sales next year,” said Curaleaf CEO Boris Jordan. “This launch is a positive step forward in our strategy to extend our position as the global leader in cannabis.”

Curaleaf also continues to expand in the U.S. It recently announced the opening of cannabis stores in Lima, OH and Punta Gorda, FL. The openings take Curaleaf’s Florida store count to 67, out of 153 stores nationwide.

Organigram (OGI)

After five years at the helm, Organigram CEO Beena Goldenberg will step down on September 30, 2025. The company has not yet announced a replacement CEO. Under her leadership, Organigram grew annual revenue to $250 million from $80 million, and the company became the market share leader in Canada.

Under her leadership, Organigram doubled cultivation capacity at its Moncton, New Brunswick facility and launched sales in Germany, U.K. and Australia. The company also got exposure to the U.S. hemp-derived drinks market via the acquisition of Collective Project announced in April.

Tilray (TLRY)

Tilray recently launched its medical cannabis brand Good Supply in Germany. Tilray has cannabis production facilities in Portugal and Germany.

Trulieve (TCNNF)

Trulieve recently opened a store in Lorain, Ohio. The store will be operated by Harvest Grows under a licensing agreement. The Ohio cannabis market continues to ramp up following the legalization of recreational use sales last year, after voters approved the change in a referendum.

Verano (VRNOF)

Verano recently opened a Zen Leaf in Enfield, CT, taking store count in the state to seven, and 157 nationwide.

Sector Performance

Our Cabot Cannabis Plus Insider Portfolio is doing well. But our plant-touching Cabot Cannabis Investor portfolio has been weak, along with the sector.

Our Cabot Cannabis Plus Insider Portfolio invests in cannabis-related names that do not touch the plant, where insiders are buying. The stocks are up 26% on average, since they were introduced.

The portfolio is positioned to outperform because investments in AFC Gamma (AFCG), Chicago Atlantic Real Estate Finance (REFI) and Chicago Atlantic BDC (LIEN) pay yields in the 12% to 18% range. The dividends were recently confirmed even though they look suspiciously high. We will also see capital appreciation in these names if sector catalysts hit.

Because our plant-touching cannabis portfolio is leveraged, it suffers in sector downturns. That is the case now, though it is down less than the sector year to date. Our Cabot Cannabis Investor portfolio cannabis portfolio was down 33% this year as of the May 27 close, compared to a decline of 38.9% in the Roundhill Cannabis (WEED) exchange traded fund.

Our plant-touching portfolio is leveraged because of the large position in AdvisorShares MSOS 2X Daily (MSOX). It is a top-five position. The leverage hurts us when the sector is weak. Likewise, it helps capture more upside as we see progress on rescheduling cannabis, and progress towards approval of recreational use in more large states like Pennsylvania.

When we get a significant sector rally, I will roll back leverage by trimming MSOX in favor of cannabis stocks or the AdvisorShares Pure U.S. Cannabis (MSOS) ETF. If you are a highly active trader, it would make sense to deleverage into rallies in the same manner along the way, and then hope for a pullback to re-lever.

Portfolio

Canna Plus Insider Portfolio

Company Profiles

Ayr Wellness (AYRWF) This is a vertically integrated multistate operator based in Miami. It has over 90 dispensaries. It operates in Florida, Illinois, Massachusetts, Pennsylvania, New Jersey, Nevada, Ohio, and Connecticut. Ayr has 18 grow and production sites, around a dozen national brands, and a proprietary library of over 160 cannabis strains. Like many names in our portfolio, Ayr is strategically positioned in states that look poised to approve recreational-use sales. It has over 60 stores in Florida, for example.

Ayr has built out its brand development strength with the appointment of David Goubert as president and CEO. Goubert previously served as president and chief customer officer at Neiman Marcus Group, and he was at LVMH for 20 years before that.

Ayr is currently launching brands from its national portfolio in New Jersey, including Ayr’s Lost in Translation flower, Kynd flower, Road Tripper flower, STIX pre-rolls, Entourage vapes, Secret Orchard vapes, and Wicked soft lozenges.

Ayr recently reported $71 million in cash and $607 million in net debt. This debt overhang is one reason why Ayr trades at 0.15 times sales. The company is founder-run, which can be a plus in investing. BUY

Cresco Labs (CRLBF) Chicago-based Cresco has the #1 market share position in Illinois, Pennsylvania and Massachusetts. The company has the top-selling branded portfolio of cannabis products in the industry. It has the top of branded flower and branded concentrates, and the third best portfolio of branded vapes.

Cresco offers exposure to many attractive U.S. markets with an emphasis on Illinois. It is also in Pennsylvania, Ohio, New York, Massachusetts, Michigan, Florida, Missouri, and Maryland. Most of those are states that recently expanded into recreational use sales, or are expected to over the next two years.

The company is founder-run, which can be a plus in investing. Cresco Labs has a price to sales ratio of 0.55. BUY

Cronos Group (CRON) Cronos is mainly a foreign operator with exposure to Canada, Germany, Australia and Israel.

Cronos has respectable brand strength in Canada. It sells gummies, infused pre-rolls and vapes under the Spinach, Blue-Raspberry Watermelon and Tropical Diesel brands. Spinach products command 15.3% market share in the Canadian edibles category, and 19.8% share in gummies, according to Hifyre.

In Israel, Cronos sells dried flower, pre-rolls and cannabis oils in the medical market. The company has a partnership with Cansativa Group which allows Cronos to sell its Peace Naturals brand in Germany, where the cannabis market should grow dramatically over the next several years because of liberalization of restrictions on sales. Cronos has a 10% stake in Cronos Australia, a publicly traded company.

Cronos has $855 million in cash, or about $2.24 per share, against minimal debt of $2.26 million. Some of that cash could be deployed in acquisitions, possibly to expand in the U.S. adult-use market.

Cronos trades at 0.75 times book value. BUY

Curaleaf (CURLF) Massachusetts-based Curaleaf was the industry leader last year. It operates 145 dispensaries and several grow sites in 17 states and its European operations. It has one of the strongest brand portfolios in the U.S. led by Select, the number one selling vape brand in its markets. Here are three factors that support growth.

1. Curaleaf is an R&D powerhouse. A team of scientists is currently developing about 180 products.

2. Like many of the names in our portfolio, Curaleaf is well positioned to benefit from the opening up of rec-use sales in New York, Ohio, Florida, Pennsylvania near term.

3. Curaleaf will benefit from progress on liberalization of cannabis laws in Germany and elsewhere in Europe. It has a majority stake in Germany’s Four 20 Pharma, a licensed producer and distributor of medical cannabis that has more than 15%-20% market share in Germany. Curaleaf International is the largest vertically integrated cannabis company in Europe. It has a lot of room to expand production, and it boasts import and distribution in the U.K., Germany, Italy, Switzerland, and Portugal. Recreational use legalization in Germany is advancing, and it could open the floodgates to further legalization throughout Europe. Curaleaf has a 50% market share in the U.K.

The company is founder-run, which can be a plus in investing. Curaleaf has a price/sales ratio of 1.07. BUY

AdvisorShares Pure U.S. Cannabis ETF (MSOS) This exchange traded fund (ETF) has large exposure to most of our portfolio names so it may seem redundant. However, I want to put it on your radar as a liquid trading vehicle for getting in and out of the group without having to make a lot of individual stock sales, and as way to get exposure to many of our names with one purchase. It also gives us diversification beyond our names, to positions like Jushi Holdings (JUSHF) and Innovative Industrial Properties (IIPR), among others. Consider accumulating this ETF on weakness of 2% or more. BUY

AdvisorShares MSOS 2x Daily ETF (MSOX) This is the leveraged version of the ETF MSOS. It theoretically goes up (and down) by twice as much as MSOS, though the relationship does not always hold exactly. Consider accumulating on weakness of 2%-4% or more. Note that leveraged ETFs suffer from some persistent valuation decay because of the cost of the leverage. BUY

ETFMG Alternative Harvest (MJ) This ETF has outsized foreign exposure, which means it could benefit more than other marijuana exchange traded funds if we see progress on legalization in Germany and Europe. That could happen in the form of draft legislation and decriminalization of recreational use in 2023. “Legalization in Germany could be a tipping point for global expansion,” according to cannabis experts at ETFMG. This would put additional pressure on other European Union members to move forward with legalization. It could also encourage reform of the 1961 U.N. Single Convention on Narcotics which prohibits the cultivation and sale of recreational cannabis. “Such a result would be momentous and would open the doors to a global market,” says ETFMG. Owning this ETF broadens our industry exposure to names outside our portfolio, like Canopy Growth (CGC; WEED.TO), SNDL (SNDL), and GrowGeneration (GRWG), among others. BUY

Green Thumb (GTBIF) Chicago-based Green Thumb is our portfolio’s largest position. It has been the most profitable multistate operator of all the big ones – a sign of good management.

Green Thumb branded cannabis products include &Shine, Beboe, Dogwalkers, Doctor Solomon’s, Good Green, incredibles and RYTHM. The company operates a national retail cannabis stores called RISE. Green Thumb has 91 dispensaries across fourteen states. Green Thumb continued to strategically position itself in markets that look poised to expand to recreational uses sales, like Florida and Pennsylvania.

Founder Ben Kovler is chairman and CEO. Research shows that founder-run companies often outperform. Kovler has a 26% stake in the business and holds nearly 59% of voting power. Green Thumb trades at a price to sales ratio of 1.93. BUY

Organigram (OGI) Organigram holds the #2 position among Canadian licensed producers. It also sells high-margin flower in Israel, Australia and Germany. Germany should see robust growth over the next few years as it loosens rules on medical cannabis use. The CEO has alluded to “creative ways” to get into the U.S. cannabis market, but does not offer details.

The company has the #1 market share position in hash globally driven by popular products like Tremblant, Holy Mountain and SHRED. It has the #1 market share position in gummies.

British American Tobacco (BTI) is a big investor in Organigram, an endorsement of its potential. The two companies collaborate to develop cannabis products. The price to sales ratio is 1.1. BUY

Tilray Brands (TLRY) Tilray is a cannabis and consumer packaged goods company with one of the biggest global footprints in the industry. CEO Irwin Simon founded The Hain Celestial Group, a natural food company, which is in the business of brand development. This is a key factor for cannabis companies, too. So, the Hain Celestial experience may bode well for shareholders.

Tilray is a big recreational and medicinal cannabis supplier in Canada. It is ranked #1 there by sales for cannabis flower, oils, concentrates, and THC beverages; #2 in pre-rolls, #4 in vape, and among the top 10 in all other categories. It also offers medical cannabis in 20 countries on five continents through its subsidiaries and agreements with pharma distributors. It has operations in Canada, the United States, Europe, Australia and Latin America. It sells craft beer and CBD products in the United States.

Tilray seems like a good play on expected legalization of recreational use in Europe over the next few years, because it has been making significant investments there. It has a medicinal marijuana distribution network in Germany. It has production facilities in Portugal and Germany, the largest medical cannabis market in Europe.

Tilray sells hemp food products through its Fresh Hemp Foods division, and it has a craft alcohol business called SW Brewing, the tenth-largest craft brewery in the United States. The price to sales ratio is 1.38. BUY

Trulieve (TCNNF) Trulieve has long been the biggest medicinal marijuana vendor in Florida, where it has 50% market share. It has over 190 dispensaries and two thirds are in Florida. Cannabis activists are trying to get recreational use on the Florida ballot in November 2024. A win would be huge for Trulieve. Approval could make Florida the largest legal U.S. cannabis market with 22 million residents and 138 million tourists a year.

Meanwhile, Trulieve has been expanding across the country. It is diversifying its presence into Pennsylvania, Maryland, Georgia, Ohio and Massachusetts, among other states.

The company reports $320 million in cash against $795 million in debt. “U.S. cannabis has significant white space ahead, with many states yet to implement medical or adult-use programs, and the growing appetite for substantive federal reform,” says CEO Kim Rivers. It has a price to sales ratio of 0.98. BUY

Verano (VRNOF) Chicago-based Verano is one of the top five publicly traded multi-state operators in the U.S. by sales. Verano has nearly 140 dispensaries and 14 production facilities in 13 states. One of the most attractive qualities of this company is that it has a big presence in high-growth markets like New Jersey, Illinois, Florida and Connecticut, and states that may soon legalize recreational like Florida and Pennsylvania. The company’s strategy has been to position with medical dispensaries in states most likely to soon go recreational.

The company’s portfolio of brands includes Encore, Avexia, MÜV and its signature Verano line of product. To capitalize on the consumer’s trading down to value brands, Verano moved up the rollout of a new budget line called Savvy last year. It operates dispensary concepts called Zen Leaf and MÜV. It also has a licensing agreement with Mike Tyson’s Tyson 2.0 cannabis company.

The company reports cash of $194 million against debt of $541 million.

Verano is founder-run, which can be a plus in investing. Verano has a price to sales ratio of 0.54. BUY

The next Cabot Cannabis Investor Issue will be published on June 25, 2025.

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