MRMD - Cannabis Rescheduling Signals Strong Returns Tax Breaks Could Increase This Stock's Market Cap By 170% | Benzinga
According to a recent report by Pablo Zuanic of Zuanic & Associates, MariMed (OTC: MRMD) a multi-state cannabis operator (MSO) is positioned for significant stock gains.
Zuanic highlights MariMed's potential to deliver "alpha" returns, meaning returns that exceed the market average, thanks to its strategic growth plans and the anticipated rescheduling of cannabis. His report presents a compelling risk/reward setup for investors, making MariMed a stock to watch in the evolving cannabis landscape.
Financial Highlights And Earnings Momentum
MariMed reported first-quarter 2024 results with sales of $37.9 million, marking a 10% year-over-year increase despite a 2.5% sequential decline. This performance surpassed expectations, particularly in the wholesale segment, which grew 40% year-over-year. Zuanic notes, "Despite the retail competition, MariMed generated 10% year-over-year sales growth in 1Q24, a testament to its strong brand penetration.”
Significant Upside From 280E Savings
MariMed stands to gain from the 280E tax savings with the anticipated rescheduling of cannabis, as outlined in the DOJ’s proposed draft rule.
From 2020 to 2023, MariMed paid $22.8 million in income taxes and declared $33.6 million, representing 10% of gross profits and 55% of profit before tax during that period.
According to Zuanic, if income tax had been calculated at 21% on ...