There’s a major move taking place in the Canadian market for cannabis stocks, and for once, it had little to do with Tilray (TSE:TLRY) (NASDAQ:TLRY). Today, it was all about High Tide (TSE:HITI) (NASDAQ:HITI), and it made a seven-figure deal to pick up Queen of Bud. That was enough for investors, who sent shares up over 7% in Friday afternoon’s trading.
The deal is finalized, and High Tide now owns the Queen of Bud brand for $1 million. That includes all the intellectual property and everything else connected with the brand. High Tide paid out that million in a mix of cash and stock, with $100,000 coming from cash and the rest in High Tide stock.
High Tide’s founder and CEO, Raj Grover, declared the deal an “…exciting new addition with tremendous future opportunities,” pointing out Queen of Bud’s “well-established brand equity” and its “extensive customer base across Canada, especially among women.” Reports note that the deal still remains subject to approval.
Working to Expand Its Operations
Give High Tide credit for ambition; it’s working to expand its operations, and Queen of Bud will give it a good way to do that effectively. Its latest expansion efforts have paid off, giving High Tide 163 stores in five different provinces in Canada. With this acquisition and other plans, High Tide looks to add another 96 stores in Ontario to that roster.
That move wasn’t even possible until recently; Ontario laws now allow any one company to own 150 dispensaries. The old laws allowed a maximum of 75. Having Queen of Bud’s operations in place will help the expansion carry out without the need to put out large capital expenditures.
Is High Tide Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on HITI stock based on two Buys assigned in the past three months, as indicated by the graphic below. After a 57.52% rally in its share price over the past year, the average HITI price target of C$7.33 per share implies 203.98% upside potential.
