A data-rich thought piece by New Cannabis Ventures makes an interesting case for using a sum-of-the-parts analysis in valuing cannabis companies with diverse operating segments, as that helps filter out any boosted value that might be otherwise be included by a simple EBITDA analysis that inflates the overall valuation by including non-cannabis operating segments. The
LAVA: M&A Trends in the Cannabis Industry
Los Angeles Venture Association (LAVA) recently hosted a webinar discussing the recent uptick of merger and acquisition activity over the last six months, and the trends that will impact the future of the market.
Two reasons for the uptick in cannabis industry investments are confidence in the economy and elections which helped legalize cannabis. Momentum
Cannabis Valuation: Some Stops On the Road to Legalization
Global X, an ETF provider, provided this thorough but succinct survey highlighting the progress toward cannabis legalization in U.S. states.; this is part 1 of a 3-part series, so more to come. As we’ve noted before, cannabis valuation issues are intertwined with regulatory and legalization issues, an interesting, but not necessarily unique
CannaLaw: Final Day & What’s Next?
Cannalaw Conference Wrap-up: What’s Next for Marijuana?
The conference closed with a look ahead to the future of the cannabis industry, patent issues, and emerging psychedelic market. What will we see with regards to patent enforcement? Only two cannabis related lawsuits have been filed to date, one that died. However, there is speculation that
CannaLaw: Valuation of Cannabis Targets
The M&A panel at yesterday’s Cannalaw conference addressed what valuation techniques are being used to determine the purchase price of a marijuana company. While in recent years the traditional valuation metrics would normally be utilized – whether multiples of sales, revenues or EBITDA, for instance – the current market is experiencing a supply/demand imbalance, as
Cannabis Valuation Space Becoming “Smoking Hot”
In this new post, major asset manager Alger spotlights the growing cannabis sector and underscores investors’ opportunities alongside increased public support and favorable legislative changes.
For more on factors affecting cannabis business valuation, including regulatory changes and legalization pushes, see our topic area.
Cannabis Business Valuation: EisnerAmper on Varied Approaches to Value
Given the rapid developments in the cannabis space — with 15 states having now legalized recreational marijuana and 21 states allowing medicinal use — approaches to the valuation of cannabis companies continues to evolve. In this new piece by EisnerAmper, the firm makes the case for utilizing any combination of an Asset Approach, Income
Cannabis Valuation: Colorado Court Speaks to Contract Rights Involving Illegality
As reported in this Law360 piece, “Illegality Nixes Most of Marijuana Investment Scheme Suit,” a Colorado judge dismissed an investor’s fraud claim against the principal behind an investment vehicle whose strategy revolved around the Colorado cannabis industry. The court found that the relief sought would violate the Controlled Substances Act, underscoring the perils of
Cannabis Valuation: Oregon Dispensary Valuation
In this interesting piece on cannabis valuation, Oregon Cannabis: What is My Partial Marijuana Dispensary Ownership Interest Worth?, Harris Bricken takes a look at the value of a less-than-100% interest in an Oregon marijuana dispensary, and what may happen if an LLC needs to value the interest of a former member after a forced
Cannabis Valuation: Cal. Proposed Bank Disclosure Rules
As reported by Law360 here, state regulators in California have proposed regulations designed to decriminalize under state law activities by banks and accountants working with the cannabis industry, purporting to ease access to financial services for marijuana businesses. Such state legislation appears more symbolic than realistic, however, as most banks will continue to refuse