Valued on a market capitalization of $ 2.4 billion, Green thumb industry (CNSX: GTII) is a cannabis stock that has fallen almost 80% compared to all time.
Green thumb manufacturers, distributes, markets and sells cannabis products for medical and adult use in the United States. The marijuana producer distributes its products under licensing store customers from third parties and sells finished products directly to consumers through its stores, as well as a direct-to-consumer delivery channel.
In 2025, the Canadian cannabis companies will continue to struggle with weak fundamentals, slow sales, negative margins and rising competition. For comparison: the American marijuana producers, including Green Thumb, report consistent profit in the midst of a challenging macro environment.
Is this cannabis stock at the moment a good purchase?
In Q2 2025, Green Thumb reported a turnover of US $ 293 million, an increase of 5% year after year. The cannabis multistate operator generated adapted EBITDA (profit before interest, taxes, depreciation and amortization) of US $ 83 million, which indicates a margin of 28%, decrease compared to the previous quarter as the competitive pressure increases.
The performance of Green Thumb reflected wider challenges in the industry. This headwind includes price compression, competition from non-regulated hemp-derived products and an illegal market that continues to substantiate legal operators.
In the quarter of June, the comparable turnover of Green Thumb fell by 4% as a result of price pressure, which were compensated by 17% growth in the consumer’s segment packed goods, powered by district distribution and new market entry, including New York.
In Q2, Green Thumb US $ 19 million has assigned strategic retail extensions and capacity improvements. It ended the quarter with US $ 177 million in cash and bought 5.6 million shares worth US $ 24 million, indicating an average costs of US $ 4.28 per share.
Is the worst over for green thumb supply?
Green Thumb is well positioned for future growth opportunities in markets such as Minnesota, where it is expected to be launched this fall this fall, and in Pennsylvania and Virginia, where management will remain optimistic about potential legalization in the coming 12 months.
The company portfolio of the company, including Rythm, Dogwalkers and incredible, showed strong performance with increased market share profits in important states.
Morningstar analysts, however, recently reduced their estimate of the real value for the cannabis shares from $ 12 to $ 10 per share, with reference to poorer than expected price compression and margin loss. The analyst noted that the adapted EBITDA margins are expected to remain below 30% as the pressure of the industry continues in the coming quarters.
Management has also announced that they will pause every three -month profit calls, referring to a market focus on legal uncertainty instead of business fundamentals.
Is the cannabis stock undervalued?
Analysts who follow GTII sharing sales sales to increase from US $ 1.13 billion in 2024 to US $ 1.43 billion in 2029. During this period, the adjusted profit is expected to increase from US $ 0.35 per share to US $ 0.76 per share. We can see that, although the turnover is expected to grow by 4.8% annually, the estimated profit growth is much higher by 16.5%.
However, investors must take into account that the income is sentenced to US $ 0.16 per share in 2025 before expanding to US $ 0.52 per share in 2027. If GTII shares are traded with a profit of 20 times forward, it would have to be more than double in the next four years. Given the estimates of the consensus price objective, the shares of Marijuana act with a discount of 85% in September 2025.
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