Last Updated: 16 Sep 2024
Executive Summary
High Tide Inc. (HITI) is a vertically integrated cannabis company with operations in Canada, the United States, and internationally. Despite strong revenue growth, the company faces challenges in profitability, with a negative profit margin and EPS. The stock has underperformed the market in recent months, but analysts remain cautiously optimistic about its long-term prospects.
Company Overview
High Tide Inc. is a leading retailer and wholesaler of cannabis products in Canada. The company operates over 150 retail stores across the country and has a significant online presence. High Tide also has a growing presence in the United States, with operations in California, Nevada, and Oregon.
Fundamental Analysis
Revenue: High Tide's revenue has grown rapidly in recent years, reaching $503.8 million in the past twelve months. The company has benefited from the expansion of the legal cannabis market in Canada and the United States.
Profitability: Despite strong revenue growth, High Tide has struggled to achieve profitability. The company's profit margin is negative, and its EPS is -$0.34. High Tide's profitability challenges are due to several factors, including high operating costs and competition from other cannabis companies.
Valuation: High Tide's stock is currently trading at $2.23, which is below its 52-week high of $2.85. The company's forward PE ratio is 19.53, which is above the industry average.
Technical Analysis
Trend: High Tide's stock price has been trending downward in recent months. The stock is currently below its 50-day and 200-day moving averages.
Support and Resistance: The stock has support at $2.00 and resistance at $2.50.
Momentum: The stock's momentum is negative, as indicated by its declining MACD and RSI indicators.
Short Term Outlook
In the short term, High Tide's stock price is likely to continue to trade within its current range. The company's profitability challenges and negative technical indicators suggest that the stock may face further downside pressure.
Long Term Outlook
In the long term, High Tide's prospects are more positive. The company is well-positioned to benefit from the continued growth of the legal cannabis market. High Tide's strong retail presence and online platform give it a competitive advantage in this rapidly growing industry.
Analyst Recommendations
Analysts are cautiously optimistic about High Tide's long-term prospects. One analyst has a "Buy" rating on the stock with a target price of $4.49.
