uploads///Forward EV to Sales Multiple for Cannabis Producers

Valuation Updates for CGC, ACB, TLRY, and Others

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Valuation update

Canopy Growth (WEED), a top pick among investors (MJ), made news recently with its Acreage Holdings deal. The update boosted Canopy’s EV[1.enterprise value]-to-sales multiple to 24.1x, much higher than its two-year average of 14.7x.

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Peer comparison

Canopy Growth’s EV-to-sales multiple is higher than peers’ median of 6.4x. Aurora Cannabis’s (ACB) multiple is also higher than peers’ multiple and its historical average, standing at 14.9x. Cronos Group’s (CRON) EV-to-sales multiple of 29.9x is higher than its historical average of 22.1x.

Although Tilray’s (TLRY) valuation has been higher than peers’ average, it has fallen this month, to 13.6x. In contrast, Aphria’s (APHA) multiple is 3.3x, lower than its historical average of 9.1x and peers’ median of 6.4x.

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