VEXTF - MSO Financial Health: Debt Restructuring Vs. Equity Raises – Analyst Digs Into Spreadsheets | Benzinga
The recent equity raises by Canopy Growth (NASDAQ: CGC) and Columbia Care (OTC: CCHWF) have sparked curiosity about which multi-state operators (MSOs) may follow suit.
In its latest report, Zuanic & Associates (Z&A) delves into the financial net debt metrics of 20 MSOs to identify potential candidates for equity raises or debt restructuring.
According to Pablo Zuanic, chief analyst at Z&A, two MSOs, Trulieve ($631 million),(NASDAQ: TLRY) and Curaleaf ($489 million) (OTC: CURLF) stand out with the highest net debt among the group. However, it's essential to consider this in the context of their sales, EBITDA and operating cash flow, as these factors determine their ability to service debt.
Join us at the Benzinga Cannabis Capital Conference in Chicago on September 27-28, and meet Pablo Zuanic. Explore the financial metrics of Multi-State Operators, equity raises, and debt restructuring in the cannabis industry.
Financial Net Debt Metrics
In terms of net debt to sales (2Q23 annualized), StateHouse (1.24x), Vext (0.95x), iAnthus (0.94x), Acreage (0.92x) (OTC: ACRHF), AYR (0.81) (OTC: AYRWF), and Schwazze (OTC: SHWZ) (0.8x) have the highest leverage ratios.
Regarding net debt to EBITDA, some companies, like iAnthus, StateHouse, 4Front, Tilt, Vext (OTC: VEXTF), and Acreage, exhibit multiples above 5x, indicating over-leverage.
"EBITDA margins widely across the group. At the top, we have Green Thumb (36%) (OTC: GTBIF), ...