The COVID-19 pandemic has proven a boon to U.S. marijuana producer Curaleaf Holdings Inc., as sales jump and many states say that cannabis is an essential service, an analyst wrote in a note to clients Wednesday.
Curaleaf stock CURLF, -10.50% , CURA, -12.36% which trades over the counter in the U.S., rose 2.7% in Wednesday trading. Shares have gained 44% in the past five days, as the Cannabis ETF THCX, +7.14% rose 28%.
In its earnings call late Tuesday, the Wakefield, Mass., pot company reported that the majority of its 54 stores are operational, avoiding delivery and offering on-premising filling of cannabis orders. Curaleaf highlighted a roughly 20% boost in sales, which lines up with other data Stifel GMP analyst Robert Fagan was examining that suggests a 30% boost in growth as a result of the COVID-19 crisis.
Fagan has a buy on the name with a C$22 target price, for its Canadian Securities Exchange-listed shares.
Ahead of the company’s earnings Tuesday, Curaleaf issued an operational update related to COVID-19, addressing measures that it has implemented to protect its employees, such as increased sanitation and hygiene, among other efforts. The company has not yet seen disruptions on the cultivation and processing side.
Curaleaf also rescinded its 2020 outlook as a result of the virus, telling investors Tuesday that its stores were closed in Massachusetts for the time being and will likely experience a falloff in sales in Nevada because of decreased tourism. In Massachusetts, the company operates two medical dispensaries, which will be allowed to operate, but is not allowed to operate