MedMen (MMEN) is a U.S. cannabis producer and retailer which operates in multiple states.

In Q4 2021 the company posted a 55.4 percent increase in year-over-year revenues, as it reopened its marijuana shops following COVID-19. Company is opening more shops, and growing its grow facility.

The company’s stock price has seen a lot of action over the last 12 months, and currently sits at C$0.37.

Bullish. The stock will see more upward movement as revenue continues to rise and new stores open. (See MedMen stock charts on TipRanks)

Operations

The company operates 24 cannabis retail shops. MedMen is present in California and Nevada as well, Illinois, Arizona, Arizona, Florida. MedMen currently has four New York retail stores.

Additionally, the company has manufacturing and grow facilities located in California and Nevada. The company plans to open new shops in Illinois, Massachusetts and California. To increase wholesale sales, the company plans to expand its Florida and Arizona grow operations.

Q4 Results

The company reported record-setting Q4 revenues of $42 million, a 55.4% year-over-year increase, and 18.5% sequential increase.

MedMen’s stores introduced delivery and curbside pickup in its California locations. MedMen also increased its product and brand selections in all its locations.

California accounts for 25.2 million dollars of the Q4 revenues. California sales were up 24.4% compared to last year’s quarter.

Company expects greater overall growth in California’s recreational marijuana market and will continue to expand there. California, with its estimated $4.4 billion cannabis sales by 2021 is the biggest cannabis market in the world.

The company reported a gross profit of $19.7 million, a 79.1% increase from last year’s $11 million. MedMen suffered a net loss in the fourth quarter of 2014 due to increased costs for opening stores and expanding facilities.

With $96.7 million of assets and $11.9 million cash, the company had a total revenue of $96.7 millions. MedMen has raised $100 million capital through investments by Canadian Cannabis LP Tilray, (NASDAQ:), as well as Serruya. Serruya is a private equity company.

Wall Street’s Take

According to Wall Street, MedMen has a Hold consensus rating, based on two Holds assigned in the past three months. The average MedMen target price is C$0.39. This implies a 7.1% upside potential.

Conclusion

Multi-state operators (MSOs) stand to gain the most in the event of U.S. federal legalization.

MedMen currently operates 24 shops in five states. It has plans for growth. MedMen continues to improve its cannabis retail model with expanded brand offerings and home delivery.

Although the company has a net loss and plenty of runway, its vision is still achievable.

MedMen’s stock trades near its target price, and is likely to uptrend.

Disclosure: Alan Sumler owned a position at MedMen and Tilray as of the publication.

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