10 Best Marijuana Stocks To Buy According to Hedge Funds

4. SNDL Inc. (NASDAQ:SNDL)

Number of Hedge Fund Holders: 10

SNDL Inc. (NASDAQ:SNDL) is the largest private-sector liquor and cannabis retailer in Canada. The company also operates as a licensed cannabis producer and stands as one of the country’s premier vertically integrated cannabis enterprises.

SNDL Inc. (NASDAQ:SNDL) has been focused on revenue growth instead of profits, increasing its revenue from $60.9 million in 2020 to just over $909 million last year. However, the Calgary-based company still hasn’t turned a profit in its last four financial years. It seems like the strategy is changing now as the liquor and cannabis retailer announced a restructuring plan in July to help slash its annual expenses by $20 million and finally improve its profitability. Moreover, the company recently moved to privatize Nova through the acquisition of the remaining outstanding minority equity interest and also closed the acquisition of Indiva, enabling it to emerge as the leader in the Canadian infused edibles category.

SNDL Inc. (NASDAQ:SNDL) maintains a strong financial position and ended Q3 2024 with a cash balance of $263 million, up from $183 million in Q2, and continues to have zero outstanding debt. To return value to its shareholders, the company also announced a share repurchase program of around $70.3 million in November.

SNDL Inc. (NASDAQ:SNDL) is also well-positioned in the US cannabis market. The company, through its subsidiary SunStream USA, holds a two-thirds economic interest in Surterra Wellness, a notable medical cannabis operator in Florida with a 10% market share. Hence, the failure of Amendment 3 was a big blow to SNDL as it was aiming for substantial growth had recreational cannabis been legalized. However, its other US assets, including loans and properties in Michigan, Massachusetts, Nevada, and Texas, provide a safety net against potential downturns.