In a Sept. 15 observe, Roth Capital Markets analyst Bill Kirk reiterated a “Buy” rating and $5.00 worth purpose on Extreme Tide (Extreme Tide Stock Quote, Chart, Data, Analysts, Financials TSXV:HITI) following third-quarter outcomes that exceeded consensus and landed on the extreme end of steering.
“Extreme Tide launched 3Q’25 outcomes above consensus and on the extreme end of steering, demonstrating helpful positioning, in what has change right into a resilient Canadian cannabis market,” Kirk talked about.
Related-store product sales rose 7.4% year-over-year, the easiest since This autumn’23, whereas free cash flow into of C$7.7-million was up 148% no matter seven new retailer openings inside the quarter. Administration reaffirmed its long-term goal of 300-plus Canna Cabana locations.
Extreme Tide is Canada’s largest cannabis retailer, working beneath its flagship Canna Cabana banner with 207 retailers all through 5 provinces. Since adopting a membership-based low price membership model in late 2021, it has grown to higher than 2.0 million Cabana Membership members and 115,000 ELITE subscribers. Related-store product sales are up 132% as a result of the transition, with widespread retailer earnings of $2.8-million yearly, or $1,648 per sq. foot.
Q3 earnings reached C$149.7-million, up 14% year-over-year and 9% sequentially, marking the strongest growth price in seven quarters and ahead of consensus at $147-million. Related-store product sales growth of seven.4% lifted market share by one proportion stage to 12%, with widespread Canna Cabana locations producing higher than double peer revenues. Gross margin of 27% was up 100 basis components sequentially and flat year-over-year, whereas Adjusted EBITDA of C$10.6-million bought right here in on the prime of the $9.6–$10.6-million steering range, up 32% quarter-over-quarter. EPS of $0.01 matched expectations, turning constructive on stronger product sales and margins.
Kirk pointed to Extreme Tide’s Remexian Pharma acquisition as a key worldwide growth driver. The German distributor purchased seven tonnes of cannabis flower in Q2’25, representing 16% of full nationwide product sales amount.
“Following the closing of its Remexian acquisition, we think about Remexian underscores how very important Extreme Tide is for LPs’ entry to: one, Canada within the current day; two, Germany tomorrow; and three, worldwide markets later,” he talked about.
“With Canadian momentum setting up and a longtime worldwide presence, we see a clear path to continued prime line and EBITDA growth, as (Extreme Tide) has efficiently grow to be every the favored Canadian retail and German present companion for important LPs,” Kirk added.
He well-known the company has underperformed Canadian and U.S. buddies not too way back, reflecting its lack of direct U.S. publicity, nonetheless argued that shares don’t mirror its dwelling or worldwide upside.
Kirk forecasts Adjusted EBITDA of $33.3-million on $577.7-million in earnings for fiscal 2025, bettering to $40.7-million on $620.5-million in 2026.
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