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Trulieve Cannabis (TSE:TRUL)
:TRUL
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Trulieve Cannabis
(OTC:TRUL)
49Neutral
Positive Factors
Cash Reserves
Sizable cash pile creates optionality: With $356 million of cash on hand, Trulieve has plenty of firepower to invest in growth catalysts across the board.
Financial Performance
Trulieve reported strong gross margins that led to EBITDA above expectations.
Future Prospects
Strong execution allowed Trulieve to exceed both top and bottom-line expectations for the quarter and introduce Q3/24 revenue guidance that’s in line with consensus expectations while also boosting operating cash flow guidance for the year to >$250 million.
Investment Attractiveness
Given Trulieve’s healthy financial position, access to capital, and best-in-class profitability metrics, the stock is attractive for investors looking for cannabis exposure to a high-quality operator.
Market Position
Trulieve is best positioned to benefit with the largest Florida footprint if Amendment 3 passes.
Negative Factors
Market Volatility
Volatility in the stock is likely due to the Amendment 3 vote occurring in Florida.
Trulieve Cannabis (TRUL) vs. S&P 500 (SPY)
Market Cap
$1.06B
Dividend YieldN/A
Average Volume (3M)118.40K
Price to Earnings (P/E)―
Beta (1Y)1.75
Revenue Growth6.27%
EPS Growth67.62%
CountryCA
Employees6,000
SectorHealthcare
Sector Strength64
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)-1.21
Shares Outstanding167,779,560
10 Day Avg. Volume98,063
30 Day Avg. Volume118,404
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.63
Price to Cash Flow (P/CF)6.10
P/FCF Ratio1.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$20.36Price Target Upside268.09% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering7
Trulieve Cannabis Business Overview & Revenue Model
Company DescriptionTrulieve Cannabis (TRUL) is a leading multi-state operator in the cannabis industry, primarily focused on the cultivation, production, and distribution of medical and recreational cannabis products in the United States. The company operates across various sectors, including retail, wholesale, and direct-to-consumer sales, offering a wide range of products such as flower, edibles, concentrates, topicals, and other cannabis-derived goods. Trulieve is known for its vertically integrated business model, which enables it to control the production process from seed to sale, ensuring high-quality and consistent products for its customers.
How the Company Makes MoneyTrulieve Cannabis generates revenue primarily through the sale of cannabis products in its retail dispensaries and wholesale operations. The company's key revenue streams include direct sales of medical and recreational cannabis products to consumers through its extensive network of dispensaries, as well as wholesale distribution to other cannabis businesses. Trulieve's vertically integrated model allows it to maximize margins by controlling costs throughout the supply chain, from cultivation to final sale. Additionally, Trulieve benefits from strategic partnerships and acquisitions that expand its market presence and product offerings, contributing to its overall earnings growth.
Trulieve Cannabis Financial Statement Overview
Summary
Trulieve Cannabis shows signs of operational recovery with improving margins and cash flow. However, persistent net losses, declining equity, and a negative net profit margin present ongoing challenges. Moderate leverage and effective cost management are positive, but consistent profitability remains uncertain.Income Statement
Trulieve Cannabis experienced a mixed performance in its income statement. The gross profit margin remained strong at approximately 60.3% in 2024, indicating effective cost management in production. However, the net profit margin is negative due to substantial net losses in recent years, which raises concerns about profitability. The revenue growth rate between 2023 and 2024 was approximately 5.1%, showcasing moderate growth but below industry expectations. EBIT and EBITDA margins showed improvement, with positive EBITDA in 2024, signaling operational recovery. Despite this, sustained net losses highlight ongoing financial challenges.45
Neutral
Balance Sheet
The balance sheet presents a mixed picture of stability and risk. The debt-to-equity ratio stands at approximately 0.65 in 2024, indicating moderate leverage but manageable debt levels compared to equity. Return on equity remains negative due to consecutive net losses, underscoring profitability challenges. The equity ratio of 44% reflects an average capital structure with potential room for improvement in equity utilization. While the company maintains a solid asset base, the decline in stockholders' equity raises concerns about financial resilience.55
Neutral
Cash Flow
Cash flow analysis reveals a mixed trajectory. Operating cash flow has increased significantly in 2024, indicating improved operational cash management. However, the free cash flow growth rate is negative due to increased capital expenditures, which may limit cash availability for other investments. The operating cash flow to net income ratio is strong, reflecting efficient cash conversion despite net losses. The free cash flow to net income ratio indicates ongoing challenges in generating cash relative to earnings. The overall cash flow position suggests improving operations but ongoing pressures on free cash generation.50
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.19B | 1.13B | 1.24B | 938.38M | 521.53M | Gross Profit |
| 715.75M | 588.63M | 682.00M | 566.13M | 386.42M | EBIT |
| 97.78M | -221.61M | 109.40M | 196.95M | 218.37M | EBITDA |
| 282.80M | -21.98M | 239.75M | 283.59M | 207.87M | Net Income Common Stockholders |
| -155.10M | -526.80M | -205.10M | 18.03M | 63.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 299.20M | 201.37M | 212.30M | 230.65M | 146.71M | Total Assets |
| 2.87B | 2.73B | 3.40B | 3.41B | 816.11M | Total Debt |
| 824.46M | 792.57M | 1.03B | 859.02M | 168.60M | Net Debt |
| 585.65M | 591.20M | 817.00M | 628.38M | 21.88M | Total Liabilities |
| 1.62B | 1.32B | 1.47B | 1.26B | 368.21M | Stockholders Equity |
| 1.26B | 1.41B | 1.93B | 2.15B | 447.90M |
| Cash Flow | Free Cash Flow | |||
| 116.82M | 146.35M | -161.49M | -293.22M | -47.10M | Operating Cash Flow |
| 271.48M | 201.84M | 23.10M | 12.90M | 99.64M | Investing Cash Flow |
| -206.62M | -37.47M | -215.06M | -215.18M | -174.65M | Financing Cash Flow |
| -33.44M | -175.59M | 177.80M | 289.23M | 129.91M |
Trulieve Cannabis Technical Analysis
Negative
5.53
Price Trends
6.41
Negative
7.45
Negative
10.90
Negative
Market Momentum
-0.23
Positive
34.10
Neutral
12.60
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TRUL, the sentiment is Negative. The current price of 5.53 is below the 20-day moving average (MA) of 5.94, below the 50-day MA of 6.41, and below the 200-day MA of 10.90, indicating a bearish trend. The MACD of -0.23 indicates Positive momentum. The RSI at 34.10 is Neutral, neither overbought nor oversold. The STOCH value of 12.60 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:TRUL.
Trulieve Cannabis Risk Analysis
Trulieve Cannabis disclosed 56 risk factors in its most recent earnings report. Trulieve Cannabis reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Trulieve Cannabis Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | C$1.97B | 20.04 | 4.19% | ― | 9.46% | 105.27% | |
51 Neutral | $1.07B | ― | -23.33% | ― | 0.67% | 19.14% | |
50 Neutral | $501.14M | ― | -15.18% | ― | -4.65% | 59.09% | |
49 Neutral | $1.06B | ― | -12.12% | ― | 6.27% | 67.62% | |
49 Neutral | $6.86B | 0.72 | -52.93% | 2.49% | 20.83% | 1.11% | |
46 Neutral | $2.17B | ― | -31.19% | ― | -4.99% | -200.83% | |
40 Underperform | C$213.77M | ― | -955.11% | ― | -24.93% | 30.59% |
* Healthcare Sector Average
Performance Comparison
TSE:TRUL
Trulieve Cannabis
5.53
-11.42
-67.37%
TSE:GTII
Green Thumb Industries
8.33
-11.98
-58.99%
TSE:CURA
Curaleaf Holdings
1.42
-5.98
-80.81%
TSE:CL
Cresco Labs
1.10
-1.94
-63.82%
TSE:TILT
TILT Holdings Inc
0.58
0.00
0.00%
TSE:VRNO
Verano Holdings
6.32
0.00
0.00%
Trulieve Cannabis Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -6.27% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Positive
Trulieve showcased strong financial performance with revenue, gross margin, and adjusted EBITDA improvements. Despite a net loss and increased SG&A expenses, the company's strategic initiatives and expansion efforts contributed positively. The setback in Florida's adult-use legalization was notable, but overall, the highlights outweigh the lowlights.Highlights
Revenue Growth
Full year 2024 revenue grew by 5% compared to 2023, with fourth quarter revenue increasing 6% sequentially and 5% year-over-year.
Gross Margin Improvement
Gross margin improved to 62% in Q4 2024, driven by lower production costs, representing a significant improvement from 52% in 2023.
Adjusted EBITDA Increase
Adjusted EBITDA increased by $98 million to $420 million for full year 2024, a 30% increase from 2023, with a 37% margin in Q4 2024.
Customer Retention and Loyalty Program Success
Customer retention improved to 68% overall and 76% in medical-only markets, with loyalty program members spending 2.3 times more than non-members.
Successful Expansion and Retail Optimization
Trulieve added 33 new stores in 2024, ending the year with 225 locations, and plans to open 10 more in 2025 while refreshing or remodeling up to 45 dispensaries.
Lowlights
Net Loss
Trulieve reported a net loss of $155 million for full year 2024, although this was an improvement from a loss of $527 million in 2023.
SG&A Expenses Increase
SG&A expenses increased to $510 million or 43% of revenue in 2024 compared to $386 million or 34% of revenue in 2023.
Challenges in Florida Market
Amendment 3 for adult-use legalization fell short of the required 60% approval, receiving support from approximately 56% of voters.
Company Guidance
During Trulieve Cannabis Corporation's fourth quarter and full year 2024 financial results call, several key metrics were highlighted. Full year revenue grew by 5% from the previous year, reaching $1.2 billion, with fourth quarter revenue increasing by 6% sequentially to $301 million. The gross margin improved to 62% in the fourth quarter, driven by lower production costs, while the adjusted EBITDA increased by $15 million to $111 million, reflecting a 37% margin. For the full year, adjusted EBITDA was a record $420 million, marking a 30% increase from 2023. Trulieve also reported a full year operating cash flow of $271 million, surpassing their $250 million target. The company ended the year with $300 million in cash and investments, and plans to focus on balance sheet improvement by retiring at least half of its private placement notes maturing in October 2026. Additionally, Trulieve expanded its retail network by adding 33 new stores in 2024, bringing the total to 225 locations, with plans to open 10 more stores in 2025.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.