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U.S. Firm's Earnings To Remain Robust Through 2023
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Recent and upcoming events, including new store openings, will drive sales and revenue growth for this retailer and wholesaler, noted an Echelon Capital Markets report.

MariMed Inc. (MRMD:OTCQX) kicked off 2023 with "solid" Q1 results that outperformed expectations, reported Echelon Capital Markets analyst Andrew Semple in a May 9 research note. The company produces and distributes medicinal and adult-use cannabis products in the U.S.

Also, the short-term outlook is promising for MariMed, driven by several recent and upcoming company developments, Semple purported.

"Our bullish view is further supported by MariMed's bolstered balance sheet, ample growth opportunities within existing markets and in new states via mergers and acquisitions, as well as a major pick-up in the adult-use sales in Maryland," Semple wrote.

Compelling Potential Return

MariMed remains an attractive investment opportunity, noted Semple, given that at its current share price of US$0.48 it is trading at a discount to small-midcap as well as large U.S. peers.

The stock boasts a "healthy upside," too, added Semple. Echelon's US$1 per share target price on the company implies a significant possible gain of 111%. Accordingly, MariMed is rated Speculative Buy.

Wholesale Segment Stands Out

Semple summarized the cannabis company's Q1/23 operational and financial results, noting they generally exceeded Echelon's estimates and were in line with consensus' forecasts. The analyst also pointed out that both MariMed's retail and wholesale divisions outperformed expectations, the latter more so.

Wholesale revenues in Q1/23 were up 71% year over year (YOY) and up 5% quarter over quarter (QOQ). They amounted to US$10.4 million (US$10.4M); Echelon expected US$9.4M.

"These results speak to our thesis that MariMed is delivering craft-quality products at scale, and its truly premium product portfolio has mitigated the impact of pricing declines," Semple commented. "New product launches (with MariMed beginning to venture into value category flower) and innovative product formats also likely helped to sustain strong wholesale performance."

Retail sales were US$23.2M, also above Echelon's projection of US$22.6M.

Total Q1/23 revenue was US$34.4M versus Echelon and consensus' estimates of US$33.3M and US$34.7M, respectively.

Overall sales increased 9.9% YOY but declined 4% QOQ, mainly due to normal seasonality and greater competition, Semple wrote.

The gross margin was 45.6%, a tad below Echelon's forecast of 46.1%.

"We believe there is room for additional margin leverage as MariMed ramps revenue throughout 2023," Semple wrote.

MariMed ended Q1/23 with US$21.6M in cash, below Echelon's estimate of US$27.6M.

Earnings To Remain Robust

Management reiterated its guidance for FY23: at least US$150M in sales, about a 48% gross margin, at least US$35M in adjusted EBITDA, and US$30M of capex.

"We view the outperformance in Q1/23, combined with a reaffirmed outlook, positively," wrote Semple. "The 2023 outlook suggests MariMed expects to deliver 12% YOY sales growth and 8% YOY adjusted EBITDA growth."

Growth Drivers Aplenty

Upcoming and recent events should help MariMed continue to grow revenue, Semple pointed out.

"We expect H2/23 should demonstrate the bulk of these growth drivers materializing, indicating that MariMed will likely sustain growth momentum into 2024 where it will benefit from its first full year of contribution from growth investments that turn online in mid-2023," Semple wrote.

The biggest anticipated development is the start of adult-use cannabis sales on July 1, 2023, in Maryland, where the company is one of the biggest wholesale suppliers. This should positively impact MariMed's wholesale operations and its recently opened dispensary in Annapolis.

Also in the plan for this year, MariMed will debut its first store in Ohio in Q2/23 and its fifth store in Illinois the following quarter. Just last month, it launched a shop in Beverly, Mass. Additionally, the company intends to add new production capacity throughout the rest of 2023 in Illinois, Maryland, and Massachusetts.

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Important Disclosures:


  1. Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
  2. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
  3. This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.

For additional disclosures, please click here.

Disclosures for Echelon Capital Markets, Marimed Inc., May 9, 2023

Echelon Wealth Partners Inc. is a member of IIROC and CIPF. The documents on this website have been prepared for the viewer only as an example of strategy consistent with our recommendations; it is not an offer to buy or sell or a solicitation of an offer to buy or sell any security or instrument or to participate in any particular investing strategy. Any opinions or recommendations expressed herein do not necessarily reflect those of Echelon Wealth Partners Inc. Echelon Wealth Partners Inc. cannot accept any trading instructions via e-mail as the timely receipt of e-mail messages, or their integrity over the Internet, cannot be guaranteed. Dividend yields change as stock prices change, and companies may change or cancel dividend payments in the future. All securities involve varying amounts of risk, and their values will fluctuate, and the fluctuation of foreign currency exchange rates will also impact your investment returns if measured in Canadian Dollars. Past performance does not guarantee future returns, investments may increase or decrease in value and you may lose money.

Data from various sources were used in the preparation of these documents; the information is believed but in no way warranted to be reliable, accurate and appropriate. Echelon Wealth Partners Inc. employees may buy and sell shares of the companies that are recommended for their own accounts and for the accounts of other clients. Echelon Wealth Partners compensates its Research Analysts from a variety of sources. The Research Department is a cost centre and is funded by the business activities of Echelon Wealth Partners including, Institutional Equity Sales and Trading, Retail Sales and Corporate and Investment Banking.

Research Dissemination Policy: All final research reports are disseminated to existing and potential clients of Echelon Wealth Partners Inc. simultaneously in electronic form. Hard copies will be disseminated to any client that has requested to be on the distribution list of Echelon Wealth Partners Inc. Clients may also receive Echelon Wealth Partners Inc. research via third party vendors. To receive Echelon Wealth Partners Inc. research reports, please contact your Registered Representative. Reproduction of any research report in whole or in part without permission is prohibited.

Canadian Disclosures: To make further inquiry related to this report, Canadian residents should contact their Echelon Wealth Partners professional representative. To effect any transaction, Canadian residents should contact their Echelon Wealth Partners Investment advisor.

U.S. Disclosures: This research report was prepared by Echelon Wealth Partners Inc., a member of the Investment Industry Regulatory Organization of Canada and the Canadian Investor Protection Fund. This report does not constitute an offer to sell or the solicitation of an offer to buy any of the securities discussed herein. Echelon Wealth Partners Inc. is not registered as a broker-dealer in the United States and is not be subject to U.S. rules regarding the preparation of research reports and the independence of research analysts. Any resulting transactions should be effected through a U.S. broker-dealer.

Company: MariMed Inc. | OTC:MRMD

I, Andrew Semple, hereby certify that the views expressed in this report accurately reflect my personal views about the subject securities or issuers. I also certify that I have not, am  not, and will not receive, directly or indirectly, compensation in exchange for expressing the specific recommendations or views in this report.


During the last 12 months, Echelon Wealth Partners Inc. provided financial advice to and/or, either on its own or as a syndicate member, participated in a public  offering, or private placement of securities of this issuer.

During the last 12 months, Echelon Wealth Partners Inc. received compensation for having provided investment banking or related services to this Issuer.


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