1/ You haven’t seen nuthin yet...

$MSOS have atleast 15x upside from current levels
Thread 🧵🧵⬇️⬇️
2/ Assumptions:

TAM of sector in 2030: $100 billion
Long term Profit Margins: ~25%
US Operators Profit 2030: $25 billion 
Current earnings multiple on the $SPY is ~22.6x NTM (Avg $SPY multiple ~17x)
3/ Applying current $SPY multiple on US operators forward 2030 earnings = ~$560 billion.
4/ Cannabis stocks will grow earnings at a *much* faster pace than the broader markets.

25% CAGR through 2030, affording a premium multiple to the market.
5/ Post uplisting and legalization, these stocks could trade at a 2x PEG or 50x earnings

(25 percent growth x 2)
6/ 50x earnings * $25 billion in profits = $1.25 trillion cumulative market cap for US operators 👀 🎉
The potential range is between $425 billion at 17x earnings and $1.25 trillion at 50x earnings.
7/ Let’s take a blended average of 33.5x earnings.

That would equate to ~$840 billion in equity value for US operators.
If a company can achieve 20% market share it could have a market capitalization of $170 billion.
8/ Current Market Caps of some of the largest players (all rounded)

$CURLF $11 billion
$GTBIF $7 billion
$CRLBF $5.5 billion
$TCNNF $6 billion
$TRSSF $4 billion
9/ If that player happens to be $CURLF, that would be a 15.5x multiple on your money from current levels.

$GTBIF, 25x multiple

$CRLBF, 31x multiple

$TCNNF, 28x multiple

$TRSSF, 42x multiple
13/ TAM estimates for the industry continue to get readjusted (to the upside) as new states open. 

With the healthy profit margins we will see in the US cannabis markets,

the cumulative equity value will trade at many multiples of the TAM.
14/ This is why it makes sense when @JasonGWild tweeted, “This is going to make what happened in Canada look like the little leagues”.

End of 🧵
Co-author: @adam_grossman1
You can follow @jonnyrubin10.
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