Multi-state operator iAnthus Capital Holdings
The new chain will be called Be. and the first flagship store will open in Brooklyn before the end of the year. Further flagship stores are slated to open in Miami, Atlantic City, Las Vegas, and Orlando.
iAnthus has licenses to launch 68 dispensaries across 11 states: California, Arizona, Nevada, New Mexico, Colorado, Florida, Maryland, New York, New Jersey, Massachusetts, and Vermont. Twenty-one of them are already operational and the firm is building out the remaining stores.
Until now they have traded under a number of different fascias under the iAnthus umbrella, including Citiva, Mayflower, and Health For Life. The company believes that consolidating its national network of stores under a single brand name will have a greater impact in the marketplace and offer better value for its 60,000 shareholders.
Be. is billed as a new kind of cannabis store where visitors receive help, advice, understanding, support, knowledge and trust. It is designed to offer a space for education and discovery, as well as sales.
“Our new Be. stores will build on the pioneering and award-winning retail experience of Beth’s Health for Life stores in Arizona and Maryland, and provide a welcoming environment where both the curious and the dedicated will feel comfortable,” said chief executive Hadley Ford.
A Compelling Investment Opportunity
iAnthus offers investors a compelling opportunity to invest in the dynamic U.S. cannabis industry. Its growth is in line with rival multi-state operators, but it trades at a significant discount to its peers.
Its share price increased from C$$5.17 on Dec. 24, 2018, to C$7.99 by Mar. 22, 2019, as the cannabis sector came flying out of the blocks at the beginning of the year. Since then, however, its price has decreased and it closed at C$5.48 on Tuesday, May 21.
Its current valuation discount to its peers provides a safety net for investors in a U.S. cannabis market packed full of unprofitable, overpriced operators.
It has an ambitious two-year growth plan and a strong management team with a long and successful track record, suggesting the potential to outperform the sector going forward as its footprint grows across the country. About half of the licenses it holds are for dispensaries in Florida, but it has clear plans to boost its presence in plenty more states. It now has the ability to launch national advertising campaigns for Be. too.
A Better Risk Profile
iAnthus closed an C$865 million all-stock purchase deal to acquire MPX Bioceutical in Feb. 2019. The merger of the two businesses created a C$1.6 billion entity, while it was the first U.S. multi-state operator to go public and raise money in Canada.
It is a vertically integrated company with approximately 820,000 sq. ft. of cultivation space, and listings with more than 100 dispensaries for its products, plus a further 750 stores that sell its CBD products across 42 states. It is ramping up its wholesale distribution and increasing its cultivation capacity to meet growing demand for its products.
By diversifying across multiple states on either coast, and combining retail, wholesale and production, iAnthus arguably creates a better risk profile for investors than rivals that are more exposed to just a handful of states.
In the interest of full disclosure, Capital 10X employees’ own shares in iAnthus. More information on the profiled company can be found by reviewing the public filings of iAnthus Capital Holdings Inc. on SEDAR at www.sedar.com. Writers at Capital10X.com are not certified financial analysts or licensed in the securities industry in any manner and the content of this report may not be complete, accurate or current. iAnthus is a consulting client of Capital 10X and though the information contained herein is believed to be the subjective opinion of the author, this business relationship could create a conflict of interest.
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