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Nina Zdinjak

This Weedmaps Analyst Sees These 'Tailwinds' For Cannabis Tech Provider After Q1 Earnings

Cannabis tech provider WM Technology Inc. (NASDAQ:MAPS), more commonly known as Weedmaps, released Wednesday its financial results for the first quarter ended March 31, 2022, revealing revenue growth of 40% year-over-year to $57.5 million.

The net loss was $31.2 million as compared to net income of $7.7 million from the prior-year period.

Adjusted EBITDA was a loss of $1 million as compared to positive $9 million from the prior-year period.

The Weedmaps Analyst

Cantor Fitzgerald’s Pablo Zuanic maintained an Overweight rating on the stock, raising the price target from $7.65 to $11.30.

The Weedmaps Takeaways

The analyst said there are several “tailwinds” for the company over the next five years:

  • Industry sales development and new stores openings;
  • Weedmaps raising penetration of licensed operators;
  • Retailers spending more on marketing, helping the company attain a larger share of advertising dollars; and
  • Weedmaps extending its suite of services.

“While our surveys show retailers (in California, for example) put great value on the platform as a form of “advertising,” the “IT solutions” part of the MAPS investment story is still a work in progress, in our view,” Zuanic said.

The analyst said that considering the company’s recent deals such as acquisitions of Spout CRM and Enlighten, it looks like Weedmaps is working on expanding its suite of solutions, and not just organically. 

Furthermore, with Weedmaps being a NASDAQ-listed company, it is potentially on track to be included in the Russell 2000 Index by midyear, and it makes investors less worried about any technical issues they usually have to face with OTC-traded multistate operators, he said. 

The MAPS Price Action 

WM Technology’s shares were trading down 6.07% at $5.88 midday Thursday, according to Benzinga Pro.

Photo: Courtesy of Joel Muniz on Unsplash.

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