One of the companies that continues to add value from among cannabis companies is that of Trulieve Cannabis (CSE:TRUL) (OTCQX:TCNNF), and it is one of those rare companies that have managed to actually turn a profit. In 2019, the company managed to generate a net income of $178 million.
While that is an impressive number, it is necessary to keep in mind that the company benefitted from onetime adjustments. The growth of biological assets and sold inventory-related adjustments totaled as much as $200 million. In 2019, those adjustments had only totaled $36.9 million, but at the same time, the company’s profits had only been $27.9 million.
Hence, investors need to be a bit careful if they are looking to invest in the Trulieve stock in light of its recent performances. Fair value adjustments make a company’s revenue and earnings figures look better than they actually are. Moreover, it becomes difficult for an investor to project future performance as well.
Trulieve primarily does business in Florida, and as many as 47 out of its total 49 retail outlets are located in that particular state. The company’s performance has naturally been noticed by investors, but in addition to that, it has been noticed by analysts as well.
The company released its financial results from the first fiscal quarter on May 13, and prior to the announcement, Paul Piotrowski of M Partners provided his verdict on Trulieve. He stated that he expected the company’s revenues to grow further, but at the same time, Piotrowski also projected that profits would go down. The analyst revealed that the company boosted its sales significantly following the onset of the coronavirus crisis.
Trulieve saw a 59% rise in dried flower sales in the first quarter, to go along with a 9% rise in THC sales and a 12% drop in CBD oil sales. The sales reached a peek back in the week of March 20. The important thing for Trulieve is that unlike in other states, the sales boom in Florida did not fall off a cliff.