Trulieve Cannabis (TRUL) AI Stock Analysis

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Trulieve Cannabis

(OTC:TRUL)

Rating:55Neutral

Price Target:

C$6.00

▲(10.09%Upside)

Trulieve Cannabis's stock score reflects strong revenue growth and operational improvements, but is weighed down by profitability challenges, valuation issues, and mixed technical indicators. The company shows potential if it can resolve these financial inefficiencies and capitalize on operational strengths.

Positive Factors

Financial Guidance

Guidance for Q4 includes gross margins above prior forecast with low single digit sequential growth in revenues.

Financial Performance

Trulieve reported strong gross margins that led to EBITDA above expectations.

Financial Position

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.

Investment Prospects

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.

Negative Factors

Market Volatility

Volatility in the stock is likely due to the Amendment 3 vote occurring in Florida.

Trulieve Cannabis (TRUL) vs. iShares MSCI Canada ETF (EWC)

Market Cap

C$1.04B

Dividend YieldN/A

Average Volume (3M)122.43K

Price to Earnings (P/E)―

Beta (1Y)2.11

Revenue Growth7.23%

EPS Growth64.93%

CountryCA

Employees6,000

SectorHealthcare

Sector Strength41

IndustryDrug Manufacturers - Specialty & Generic

Share Statistics

EPS (TTM)-0.24

Shares Outstanding167,851,060

10 Day Avg. Volume59,075

30 Day Avg. Volume122,434

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)0.69

Price to Sales (P/S)0.00

P/FCF Ratio30.60

Enterprise Value/Market Cap1.31

Enterprise Value/Revenue0.29

Enterprise Value/Gross Profit1.89

Enterprise Value/Ebitda1.14

Forecast

1Y Price Target

C$21.86

Price Target Upside301.07% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

Trulieve Cannabis Business Overview & Revenue Model

Company DescriptionTrulieve Cannabis Corp. (TRUL) is a leading, vertically integrated cannabis company based in the United States. It operates in the healthcare and consumer goods sectors, focusing primarily on the cultivation, production, and sale of medical and recreational cannabis products. Trulieve offers a comprehensive range of cannabis products, including flowers, edibles, concentrates, and topicals, catering to a diverse clientele across multiple states where cannabis is legally permitted.

How the Company Makes MoneyTrulieve Cannabis makes money through a vertically integrated business model that encompasses the entire supply chain from cultivation to retail. The primary revenue streams include the sale of cannabis products at its own retail dispensaries, as well as wholesale distribution to other licensed cannabis businesses. The company benefits from significant in-house production capabilities, reducing costs and ensuring product quality. Trulieve's earnings are bolstered by its extensive retail network, strategic acquisitions of other cannabis companies, and expansion into new markets as legislation permits. Additionally, partnerships with other industry players and a strong brand presence contribute to its revenue generation.

Trulieve Cannabis Earnings Call Summary

Earnings Call Date:May 07, 2025

(Q1-2025)

% Change Since: -11.09%|

Next Earnings Date:Aug 06, 2025

Earnings Call Sentiment Neutral

The earnings call reflects a strong operational performance with increased revenue and improved margins, alongside significant growth in loyalty program and wholesale segments. However, challenges such as a slight decline in retail revenue and increased SG&A expenses contributed to a net loss for the quarter.

Q1-2025 Updates

Positive Updates

Strong First Quarter Revenue

First quarter revenue of $298 million, slightly increased compared to an atypically strong first quarter last year.

Improved Gross Margin

Gross margin improved to 62% versus 58% last year, driven by lower production costs and disciplined promotional activity.

Increase in Wholesale Revenue

Momentum in wholesale business with revenue up 25% versus last year, driven by demand for Trulieve branded products and expanded relationships in Maryland and Pennsylvania.

Loyalty Program Growth

Loyalty program reached over 625,000 members, growing by almost 20% in the first quarter, with loyalty program members spending 2.3x more per month than non-loyalty members.

Retail Traffic and Unit Sales Increase

Retail traffic and units sold both increased 7% year over year.

Product Expansion and Innovation

Launch of new branded products including THC beverages like 'Onward' and upcoming 'Upward' energy drink.

Positive Cash Flow

Operating cash flow of $51 million contributed to cash approximately $330 million at quarter end.

Positive Customer Metrics

Net Promoter Score increased by four points compared to last year, with every market scoring within the target range.

Negative Updates

Slight Decline in Retail Revenue

Despite increased retail traffic and units sold, pricing compression and loyalty point redemptions pressured retail revenue to decline slightly by 1%.

Increased SG&A Expenses

SG&A expenses were $119 million or 40% of revenue, compared to $101 million or 34% last year, due to new store opening expenses, technology and infrastructure investments, and campaign support.

Net Loss for the Quarter

First quarter net loss was $33 million, compared to a loss of $23 million last year.

Company Guidance

During the first quarter of fiscal year 2025, Trulieve Cannabis Corporation reported revenue of $298 million, marking a slight increase compared to the previous year. The company achieved a gross margin of 62%, up from 58% last year, due to lower production costs and disciplined promotional activities. Adjusted EBITDA reached $109 million, representing a 37% margin, which is a 1% improvement year-over-year. Operating cash flow totaled $51 million, contributing to a cash position of approximately $330 million at quarter-end. Retail traffic and units sold both increased by 7% year-over-year, although retail revenue declined slightly by 1% due to pricing compression and loyalty point redemptions. Wholesale revenue rose 25%, driven by demand for Trulieve-branded products and expanded partnerships in Maryland and Pennsylvania. The loyalty program grew by nearly 20% in the first quarter, reaching over 625,000 members, with loyalty members spending 2.3 times more per month than non-members. Trulieve opened six new dispensaries and relocated one in Pennsylvania, bringing the total to 229 dispensaries across eight states. The company remains focused on four key areas for growth: customers, distribution, branded products, and regulatory reform, with an emphasis on pushing for cannabis reform at the federal level.

Trulieve Cannabis Financial Statement Overview

Summary

Trulieve Cannabis shows promising revenue growth and a healthy gross profit margin. However, profitability challenges and fluctuating cash flows present significant risks. A stable debt position is positive, but declining equity raises concerns about long-term financial health. Improvements in net income and cash flow stability are needed for enhanced financial stability.

Income Statement

Neutral

Trulieve Cannabis has demonstrated consistent revenue growth over the years, with a significant increase from 2020 to 2025. However, the company has faced challenges in maintaining profitability, evident from the negative net income figures in recent periods. The gross profit margin remains healthy at around 61.1% TTM, indicating efficient production and sales processes. Despite a positive EBIT margin, the net profit margin is negative, highlighting issues in controlling overall expenses or other non-operational costs.

Balance Sheet

Positive

The company's balance sheet shows a stable equity position, with a debt-to-equity ratio of approximately 0.67 TTM, which is reasonable for the industry. The equity ratio of 42.7% TTM suggests a balanced capital structure. However, there is a declining trend in stockholders' equity over the years, which may signal potential risks in asset management or retained earnings.

Cash Flow

Neutral

Trulieve's cash flow statements reveal a volatile free cash flow, with recent periods showing limited growth. The operating cash flow to net income ratio is positive, suggesting operational cash efficiency, but the free cash flow to net income ratio is low, indicating challenges in generating free cash flow from earnings. This inconsistency in cash flow growth may affect future liquidity and investment capabilities.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
1.19B	1.19B	1.13B	1.24B	938.38M	521.53M
	Gross Profit
725.16M	715.75M	588.63M	682.00M	566.13M	386.42M
	EBIT
85.01M	97.78M	-221.61M	109.40M	196.95M	218.37M
	EBITDA
272.16M	282.80M	-21.98M	239.75M	283.59M	207.87M
	Net Income Common Stockholders
-164.90M	-155.10M	-526.80M	-205.10M	18.03M	63.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
328.45M	299.20M	201.37M	212.30M	230.65M	146.71M
	Total Assets
2.89B	2.87B	2.73B	3.40B	3.41B	816.11M
	Total Debt
823.78M	824.46M	792.57M	1.03B	859.02M	168.60M
	Net Debt
495.33M	585.65M	591.20M	817.00M	628.38M	21.88M
	Total Liabilities
1.67B	1.62B	1.32B	1.47B	1.26B	368.21M
	Stockholders Equity
1.23B	1.26B	1.41B	1.93B	2.15B	447.90M
Cash Flow		Free Cash Flow
28.49M	116.82M	146.35M	-161.49M	-293.22M	-47.10M
	Operating Cash Flow
183.07M	271.48M	201.84M	23.10M	12.90M	99.64M
	Investing Cash Flow
-144.24M	-206.62M	-37.47M	-215.06M	-215.18M	-174.65M
	Financing Cash Flow
-36.38M	-33.44M	-175.59M	177.80M	289.23M	129.91M

Trulieve Cannabis Technical Analysis

Technical Analysis Sentiment

Negative

Last Price5.45

Price Trends

50DMA

5.63

Negative

100DMA

6.05

Negative

200DMA

9.05

Negative

Market Momentum

MACD

-0.11

Positive

RSI

40.37

Neutral

STOCH

23.04

Neutral

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 5.45 is below the 20-day moving average (MA) of 5.91, below the 50-day MA of 5.63, and below the 200-day MA of 9.05, indicating a bearish trend. The MACD of -0.11 indicates Positive momentum. The RSI at 40.37 is Neutral, neither overbought nor oversold. The STOCH value of 23.04 is Neutral, 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 (53)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CRON	64 Neutral	$1.03B	14.80	4.61%	―	38.16%	―
DHT.UN	64 Neutral	C$727.54M	353.01	0.27%	3.85%	14.11%	-102.18%
GTII	63 Neutral	C$1.70B	24.37	2.83%	―	8.77%	-10.79%
TRUL	55 Neutral	C$1.04B	―	-12.39%	―	7.23%	64.93%
CURA	54 Neutral	C$863.32M	―	-25.08%	―	-0.11%	11.22%
Sector *	53 Neutral	$5.25B	3.24	-45.38%	2.81%	16.79%	-0.06%
CL	51 Neutral	$347.99M	―	-17.34%	―	-4.38%	46.68%

* Healthcare Sector Average

Performance Comparison

TSE:TRUL

Trulieve Cannabis

5.44

-6.36

-53.90%

TSE:CRON

Cronos Group

2.65

-0.78

-22.74%

TSE:GTII

Green Thumb Industries

7.11

-8.91

-55.62%

TSE:CURA

Curaleaf Holdings

1.20

-4.93

-80.42%

TSE:CL

Cresco Labs

0.70

-1.77

-71.66%

TSE:DHT.UN

DRI Healthcare

13.02

-1.83

-12.32%

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.