INLB - Item 9 Labs (INLB) - Expanding Unity Rd. Footprint
New Agreements. Item 9 Labs announced continued development of its cannabis dispensary franchise brand, Unity Rd., across the Northeastern United States with new signed agreements for development in New Jersey and Virginia and the signing of a lease for the first Unity Rd. dispensary in Maine by an existing partner. Unity Rd. has multiple agreements signed with more than 15 entrepreneurial groups who are in various stages of development across eight states.New Jersey. Adult use was approved by voters in November 2020 and in August regulators approved initial rules for the program that will set up the state’s retail market. The New Jersey market is projected to hit around $750 million of sales in the first full year growing to $2.1 billion in the fourth year.Virginia. Medical cannabis was approved in October 2020 and adult use in July of this year. Lawmakers have set a 2024 target to begin retail sales to recreational users, although advocates are pushing to expedite this date. Medical sales are projected to be in the $30-$35 million range next year and the overall market is projected at $1.0-$1.3 billion once mature.Maine. Adult use recreational cannabis was launched in October 2020. Currently there are roughly 25 adult use dispensaries that have been approved. There are no statewide limits, but municipalities can enact bans and restrictions. The market for cannabis in Maine is projected to be in the $165-$200 million range once matured. In August sales exceeded $10 million for the first time.Maintaining Outperform and $4.00 PT. We are maintaining our Outperform rating and $4.00 12-month price target on INLB shares. Item 9 is combining a traditional cannabis cultivation operation with an asset light franchise dispensary model to expand across the nation. We believe the combination creates a differentiated business model that offers premium products and distribution through an expanding network of dispensary franchises. Read More >>