Raymond James raised its stock price target on Canadian cannabis company Organigram Inc. OGI, +39.79% to C$6 ($4.78) from C$3 on Friday, after the company announced a $176.6 million investment from British American Tobacco PLC BATS, +0.59% and plan to cooperate in developing CBD products. “With its shiny new partnership with BAT, the wind is now at OGI’s back, in our view,” analysts Rahul Sarugaser and Michael W. Freeman wrote in a note to clients. The analysts are expecting Organigram’s share of the Canadian adult-use cannabis market to grow to 12.5% through 2025 from 6.5% now, thanks to the new partnership. That will generate revenue of $86.8 million in 2021 and $92.0 million in 2022, growing to $583.9 million in 2025, they wrote. “Given bottoming revenue in 2Q21 and project revenue growth through 3Q21 onward, plus the support of BAT now at its back, we maintain our rating on OGI at Outperform,” said the note. Organigram shares were down 6% premarket, but have gained 181% in the last 12 months, while the Cannabis ETF THCX, +8.39% has gained 216% and the S&P 500 SPX, +1.04% has gained 59%.
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