Current Footprint and Growth Potential
Green Thumb is the second-largest MSO by EBITDA and third by sales, boasting a robust balance sheet and operating cash flow metrics. Operating in 15 states, with a focus on economically attractive regions, the company has consistently delivered profitability metrics and maintained a relatively unleveraged balance sheet.
Pablo Zuanic, senior analyst, explained Green Thumb's (GTI) presence spans 15 states, with a particular emphasis on states transitioning from medical to recreational sales.
GTI is strategically positioned in states like CT, MD, NJ and RI where the recreational market is in its infancy.
Additionally, GTI is well-prepared for potential shifts in med states like OH, PA and FL toward recreational markets, depending on ballot initiatives and legislative changes.
"The company's current five medical states, with a total combined market sales of $3.8 billion in 2022, have the potential to represent a Total Addressable Market (TAM) of $12 billion if they transition to recreational use (assuming a $200 per capita spend), or even as much as $18 billion (at a $300 per capita spend; Michigan is at $330),” Zuanic wrote.
“Emerging recreational markets like CT, MD, NJ, NY, and RI could also make up a TAM of approximately $8 billion at a $200 per capita spend, compared to the $1.5 billion in sales in 2022,” Zuanic continued.
The analyst explained that while some states have store caps that may limit market share growth, few …