Planet 13 Holdings (PLNHF) is a cannabis-related business that’s poised to exploit the increasing expansion of state-legal marijuana markets, explains John Persinos, editorial director of Investing Daily.
In the US, the medical use of cannabis has been legalized in 39 states and the District of Columbia. The recreational (aka, adult-use) of cannabis has been approved in DC and 21 states. Additional states are poised to join the legalization list. New state and local legal markets equal more customers, greater profits — and higher share prices for cannabis equities.
The company’s name sounds like a low-budget sci-fi flick, but don’t let that fool you. Planet 13 is positioning itself to be the Walt Disney of pot. I’m sure comparing a marijuana company to Disney may seem a little odd, until you understand exactly what it’s up to.
Everything this smart player does, from growing its own product to processing it, then ultimately selling it in slick, high-end superstores — including the two largest dispensaries in the world, that feature massive interactive digital displays and photo-worthy features like tricked-out VW buses — is about controlling the seven marijuana brands it has developed and people’s experience with them.
Founded in 2002, Planet 13 runs the largest cannabis dispensary in the world, the massive THC and CBD cannabis product superstore/entertainment complex Planet 13 Las Vegas, as well as the largest dispensary in California.
Planet 13 currently runs dispensary locations across all of California and Nevada, with an expanding market in Florida and Illinois. Planet 13 Holdings is a vertically integrated leader in the cannabis industry, handling cultivation, processing, and dispensing through high-end stores that feature a strong entertainment element as well as wholesale offerings.
Planet 13 is known for its experiential locations that emphasize the in-store experience as a source of entertainment in and of itself, in addition to the quality, experience, and branding of the actual products.
The company’s market cap is $237.8 million. That’s small enough to offer exponential growth, but not so small to set off red flags. The company has nearly $53 million cash on hand, with a manageable debt-to-equity rating of 11.35 (most recent quarter).
The average analyst estimate is for Planet 13 to rack up year-over-year earnings growth of 250% in the next quarter, 140% for full-year 2022, and a whopping 850% in full-year 2023. The Wall Street consensus is for the stock to gain at least 600% over the next 12 months.