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KushCo Holdings: Analysts’ Target Price and Ratings

KushCo Holdings’ (KSHB) stock price has been under pressure since it reported its third-quarter earnings on July 9. As of September 27, the company has lost 69.8% of its stock value since July 9. On September 26, the company announced a direct offering of $30 million. The company plans to utilize the proceeds from the sale of 17.2 million units to meet its day-to-day expenses. KushCo Holdings will also use the proceeds to fund its corporate expenses. However, the company’s offering is seen as a dilution of its holdings, which led to a fall in its stock price. KushCo Holdings stock has fallen 42.4% since Septemeber 26.

KushCo

Analysts’ rating for KushCo Holdings

Despite the fall, analysts still look bullish on KushCo Holdings. There hasn’t been a change in analysts’ rating since the company reported its third-quarter earnings. As of September 27, eight analysts cover KushCo Holdings. Among the eight analysts, two recommend a “strong buy,” while six recommend a “buy.” The stock hasn’t received any “hold” or “sell” ratings from the analysts.

Let’s look at analysts’ ratings for KushCo Holdings’ peers:

  • Analysts are also bullish on OrganiGram Holdings (OGI). Among the 14 analysts that cover the stock, 13 recommend a “buy” and one recommends a “hold.”
  • Currently, 12 analysts cover Aphria (APHA). Among the 12 analysts, 75% recommend a “buy,” 16.7% recommend a “hold,” and 8.3% recommend a “sell.”
  • Among the 16 analysts that follow HEXO (HEXO), 75% recommend a “buy,” 18.8% recommend a “hold,” and 6.3% recommend a “sell.”

Target price

In the above graph, you can see that KushCo Holdings’ consensus target price has fallen from $8.40 on May 30 to $7.44 as of September 27. The decline in the consensus price target represents analysts’ weaker sentiments. The new consensus target price implies a 12-month return potential of 379.8%.

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On September 27, OrganiGram, Aphria, and HEXO were trading at discounts of 140%, 106.6%, and 87.5%, respectively, from their respective target prices.

YTD stock performance

So far, KushCo Holdings stock has fallen 71.1% YTD (year-to-date). Skepticism about dilution and growing concerns about vaping-related deaths caused the company’s stock price to fall. KushCo Holdings generated 53.2% of its revenues from vapes last year.

HEXO has returned 17.8% YTD, while Aphria’s stock price has fallen 7.9%. OrganiGram’s return has been flat this year.

On September 20, MKM Partners gave HEXO a “buy” rating. Last month, the company introduced 18 new cannabis products in Ontario. All of these factors caused the company’s stock price to rise.

OrganiGram reported its third-quarter earnings on July 15. During the third quarter, the company’s revenues and gross margin fell compared to the second quarter, which caused the company’s stock price to fall. For analysts’ ratings on OrganiGram, read OrganiGram: Analysts’ Target Price and Ratings.

Aphria reported impressive first-quarter earnings. The company outperformed its top-line and bottom-line estimates, which caused the stock price to rise. To learn more about analysts’ ratings, read Aphria: Analysts’ Target Price and Ratings.

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