Illinois-based multi-state operator (MSO) Green Thumb Industries (GTI) (CSE:GTII,OTCQX:GTBIF) credited the increased traffic from its recently acquired retail network for doubling revenues in its Q2 2019.

As part of its financial results for the quarter announced on Wednesday (August 28), the MSO reported US$44.7 million in revenue, a 60 percent jump from its previous operating quarter.

The revenue spike was attributed to GTI’s expanding retail line of stores under the name Essence. The company noted 25 of these stores were open and operating during the quarter.

Ben Klover, founder and CEO of GTI, said the company is in a position where it needs to fully leverage its business in order to set up its long term performance goals.

“We are focused on optimizing our wholesale and retail businesses, integrating our acquisitions, and further strengthening compliance across the organization,” Klover said in a press release.

The MSO, which has a presence in 12 state cannabis markets, posted a net loss of US$22.2 million. The loss represented a US$0.12 loss per share for investors during the quarter.

GTI closed its acquisition of the Essence retail network parent company in June — a deal Klover called “a major win” for his shareholders. GTI’s purchase was valued at approximately US$290 million divvied up between US$52 million in cash and an issuance of just over 20 million shares of the company.

The purchase got GTI ownership of three flagship, high volume stores in Las Vegas, Nevada. Essence also holds licenses for additional stores in Nevada, a store in West Hollywood, California and the operations of two cultivation facilities.

By the end of the year, GTI expects to have between 35 and 40 stores open across its retail brands in the US. In addition to the Essence store line, GTI oversees its own retail brand called Rise.

In his initiation of coverage for GTI, Matthew Pallotta, equity research analyst with Echelon Wealth Partners, assigned a ‘Buy’ rating and issued a one year price target of C$24.

“We believe the recent addition of the Essence (Integral Associates) retail business has established its portfolio of dispensaries and dispensary licenses as one of the best in the country,” Pallotta wrote in his note to investors.

The review of GTI, alongside notes for Cresco Labs (CSE:CL,OTCQX:CRLBF) and Columbia Care (CSE:CCWH,OTCQX:CCHWF), represent the first notes for MSOs coming from Echelon Wealth. GTI was the only company to receive a full ‘Buy’ rating.

Pallotta credited his decision regarding GTI due to what he wrote are industry leading assets and licenses in the US. The analyst also highlighted the company’s balance sheet and its opportunity to gain access to non-dilutive capital.

Similarly, Michael Lavery, principal and senior research analyst with Piper Jaffray, launched his coverage of the company with a C$13 price target, according to analyst data aggregator TipRanks.

Shares of GTI opened at a price of C$12.20 following a nearly 9 percent incline in value leading to the release of its financials. On Thursday as of 12:50 p.m. EDT, the company had gained an additional 1.10 percent in value from its previous close, for a trading price of C$11.92.

Don’t forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

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