Village Farms price target raised to $2.50 from $1.75 at Alliance Global Partners

Alliance Global Partners raised the firm’s price target on Village Farms (VFF) to $2.50 from $1.75 and keeps a Buy rating on the shares. Village reported sales roughly in-line with the firm’s and Street estimates and although adjusted EBITDA missed estimates, the firm notes that the company would have beat estimates excluding the $4.3M dust storm impact in Texas. The company also announced plans to privatize two of its Texas assets totaling 80-acres for consideration of $40M cash and a 38% stake in a newly formed JV, notes the analyst, who view the transaction as favorable to shareholders given it provides an infusion of capital putting Village in a net positive cash position, allows for greater focus on its cash flowing cannabis businesses and still provides optionality for the company to utilize its remaining Texas assets if any changes to U.S. federal regulations occur.