HOUSE_OVERSIGHT_024876.jpg
1.48 MB
Extraction Summary
1
People
11
Organizations
0
Locations
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Events
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Relationships
4
Quotes
Document Information
Type:
Financial research report / investment banking analysis
File Size:
1.48 MB
Summary
This document is page 60 of a financial research report titled 'Cowen Collaborative Insights' dated February 25, 2019. It analyzes the financial performance and outlook of CBD companies, specifically highlighting Charlotte's Web (CWEB) and CV Sciences (CVSI) for their strong EBITDA margins and revenue growth. The document includes charts comparing various cannabis/CBD companies (TPB, GTI, TLRY, etc.) and projects significant revenue growth for Charlotte's Web through 2020. The document bears a 'HOUSE_OVERSIGHT_024876' stamp, indicating it was part of a document production for a congressional investigation, likely subpoenaed from Cowen regarding financial records.
People (1)
| Name | Role | Context |
|---|---|---|
| Michael Cella | Recipient/Employee |
Email address listed in sidebar watermark: michael.cella@cowen.com
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Organizations (11)
| Name | Type | Context |
|---|---|---|
| Cowen |
Creator of the report (Cowen Collaborative Insights)
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| Charlotte's Web |
Analyzed for revenue growth and EBITDA (Ticker: CWEB)
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| CV Sciences |
Analyzed for revenue growth and EBITDA (Ticker: CVSI)
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| Elixinol |
Mentioned as an established, well-capitalized company
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| Bloomberg |
Cited as a source for Figure 106
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| House Oversight Committee |
Implied by Bates stamp 'HOUSE_OVERSIGHT_024876'
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| TPB |
Listed in chart comparison
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| GTI |
Listed in chart comparison
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| 1933 |
Listed in chart comparison
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| CURA |
Listed in chart comparison
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| TLRY |
Listed in chart comparison
|
Relationships (1)
Email address domain and report watermark indicating intended recipient.
Key Quotes (4)
"CBD finished products are highly profitable."Source
HOUSE_OVERSIGHT_024876.jpg
Quote #1
"Charlotte’s Web and CV Sciences are EBITDA positive, generating 30% margins in the most recent quarter"Source
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Quote #2
"Charlotte’s Web generated 172% growth last year"Source
HOUSE_OVERSIGHT_024876.jpg
Quote #3
"This report is intended for michael.cella@cowen.com. Unauthorized redistribution of this report is prohibited."Source
HOUSE_OVERSIGHT_024876.jpg
Quote #4
Full Extracted Text
Complete text extracted from the document (2,321 characters)
COWEN
COLLABORATIVE INSIGHTS
February 25, 2019
COLLABORATIVE INSIGHTS
February 25, 2019
As evidenced by the above chart, in addition to offering very strong revenue growth prospects, CBD finished products are highly profitable. While it is still early days, both Charlotte’s Web and CV Sciences are EBITDA positive, generating 30% margins in the most recent quarter, which is an encouraging sign. This intersects at a period where other companies across the broad cannabis landscape have been investing heavily in SG&A, which includes but is not limited to headcount increases and R&D.
Figure 104 CWEB and CVSI Are Posting Strong EBITDA...
MRQ Adj. EBITDA (in $ mm)
$13.8
$5.4
$4.1
$0.4
-$0.9
-$5.5
-$7.4
CWEB CVSI TPB GTI 1933 CURA TLRY
CBD
CBD-Crossover/Other
Note: 1933 = 1Q19 (ended 10/18) (ended 12/18), All others are 3Q18 (ended 9/18).
AUD/USD = 0.72
Source: Company Reports and Cowen and Company
MRQ Adj. EBITDA (in $ mm)
$13.8
$5.4
$4.1
$0.4
-$0.9
-$5.5
-$7.4
CWEB CVSI TPB GTI 1933 CURA TLRY
CBD
CBD-Crossover/Other
Note: 1933 = 1Q19 (ended 10/18) (ended 12/18), All others are 3Q18 (ended 9/18).
AUD/USD = 0.72
Source: Company Reports and Cowen and Company
Figure 105 ...With Margins Exceeding 30%
MRQ Adj. EBITDA Margin
30.5% 30.4%
20.9%
2.3%
-18.6%
-25.7%
-73.3%
CWEB CVSI TPB GTI 1933 CURA TLRY
CBD
CBD-Crossover/Other
Note: 1933 = 1Q19 (ended 10/18) (ended 12/18), All others are 3Q18 (ended 9/18).
AUD/USD = 0.72
Source: Company Reports and Cowen and Company
MRQ Adj. EBITDA Margin
30.5% 30.4%
20.9%
2.3%
-18.6%
-25.7%
-73.3%
CWEB CVSI TPB GTI 1933 CURA TLRY
CBD
CBD-Crossover/Other
Note: 1933 = 1Q19 (ended 10/18) (ended 12/18), All others are 3Q18 (ended 9/18).
AUD/USD = 0.72
Source: Company Reports and Cowen and Company
This report is intended for michael.cella@cowen.com. Unauthorized redistribution of this report is prohibited.
While Charlotte’s Web generated 172% growth last year, we can see that sales are expected to remain robust. Charlotte’s Web is guiding for 2018 revenues to be between $65-80 mm, which would represent ~81% growth at the midpoint of the range. For 2019, the company is guiding for $120-170 mm, which would represent 100% growth at the midpoint. Looking out to 2020, current consensus estimates of $295 mm would imply further robust growth at over 100%. With momentum in CBD expected to ramp on a go-forward basis, we would look for these more established, well capitalized companies such as Charlotte’s Web, CV Sciences and Elixinol to consolidate market share in the form of distribution gains from new channels coming online as well as a from considerable amount of consolidation.
Figure 106 Charlotte's Web's Top-Line Outlook
Charlotte's Web Revenue Estimates (in $ mm)
YoY Growth:
2018 = ~81%
2019 = ~100%
2020 = ~103%
$40
$73
$145
$295
2017A 2018E 2019E 2020E
Source: Company Reports, Bloomberg
Charlotte's Web Revenue Estimates (in $ mm)
YoY Growth:
2018 = ~81%
2019 = ~100%
2020 = ~103%
$40
$73
$145
$295
2017A 2018E 2019E 2020E
Source: Company Reports, Bloomberg
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HOUSE_OVERSIGHT_024876
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