The 2022 heat and rising interest rates were difficult for many industries operating against the backdrop of ongoing inflation. Negative macro development affects all angles Sandial (SNDL) Latest quarterly report.
Canadian cannabis company C dials total net income of C $ 17.6 million, a 29% sequential drop, as seasonal slow sales hit the top-line. Net cannabis cultivation fell 31% quarter-over-quarter to C $ 8.8 million as sales to both wholesale and provincial distributors hit a hit – down about 64% and 14% Q / Q, respectively.
As the company moves toward the premium inhable categories and moves away from discount offers, Canacard analyst Shan Mir sees more “near-term challenges” for the business. That said, analysts add, “We believe the new product launch will help drive modest sequential gains across provincial sales channels (including 159 new product list protected YTDs) starting from FQ2 / 22.”
Retail sales also declined steadily – in F4Q21 from 24.5% C $ 10.0 million to ~ C $ 7.5 million. The company currently boasts 183 cannabis retail locations in Canada, although based on previous noise made by management, given the “retail saturation” in most significant markets, Mir hopes to “slow down” the opening of the Sandial store.
On the bright side, Cash Opex dropped from C $ 13.1 million to C $ 11.9 million, a steady improvement of 9%. However, the weak top-line, “silent margin profile,” and declining earnings from the company’s investment arm, adj. EBITDA FQ4 / 21 showed a quarterly (C $ 0.6 million) loss compared to a profit of .4 C $ 18.4 million, and fell far short of Mir’s forecast of C $ 10 million.
So, nothing more to shout about, as Mir has recovered a hold rating and a ্যের 0.6 price target. Even so, owning one is still beyond the reach of the average person. (See Mir’s track record, Click here)
In the last 3 months, only one other analyst has reviewed the prospects of SNDL and they agree with Mir’s forecast, which gives the stock a hold consensus rating. Combined with the Canaccord analyst’s objective, the average price target stands at $ 0.59, suggesting a 12-month uptrend of 43%. (See Sandial Stock Forecast in Tiprank)
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Disclaimer: The views expressed in this article are those of the featured analyst only. Content is intended for informational purposes only. It is very important to do your own analysis before making any investment.