Jefferies Maintains a Buy Rating on OrganiGram Holdings (OGI)

By Ryan Adsit

OrganiGram Holdings (OGIResearch Report), the Materials sector company, was revisited by a Wall Street analyst today. Analyst Owen Bennett from Jefferies rated OrganiGram Holdings (OGIResearch Report) a Buy, setting a C$10 price target.

Bennett said:

“OrganiGram delivered impressive Q2 results – its third consecutive quarter of positive EBITDA. Revenues, GM and EBITDA all exceeded estimates and guidance. In our initiation, we argued that OrganiGram’s recreational outlook deserved more value, and we think this is validated by that fact that its Q2 recreational sales were second only to Canopy’s. Further details on plans for vape and beverages were welcome, setting the company up well for October’s launch. Results beat consensus OrganiGram’s Q2 results were generally above consensus. Net revenues were C C$26.9m, slightly above consensus at C$25.5m and previous guidance of “at least” C$25m. Gross margin was also notably strong at 60% (cons. 59%), despite the absorption of medical excise tax, a greater mix of lower-margin recreational sales, and a scaling-up of facilities. Adj EBITDA of C$13.3m beat consensus at c.C$8m.”

According to TipRanks.com, Bennett is a 2-star analyst with an average return of 0.1% and a 47.8% success rate. Bennett covers the Healthcare sector, focusing on stocks such as The Green Organic Dutchman Holdings Ltd, Aurora Cannabis Inc, and Tilray Inc.

Currently, the analyst consensus on OrganiGram Holdings is a Strong Buy with an average price target of C$9.38.

Based on OrganiGram Holdings’ latest earnings release for the quarter ending November 30, the company reported a quarterly net profit of C$29.48 million. In comparison, last year the company had a net profit of C$1.08 million.

OrganiGram Holdings, Inc. engages in the production and sale of medical marijuana. Its products include strains, cannabis oils, and vaporizrs. The company was founded in 2013 and is headquartered in Moncton, Canada.

The company’s shares closed on Monday at C$8.68.