Ascend Wellness Holdings (AAWH) PT Lowered to $13 at Needham & Company

Needham & Company analyst Matt McGinley lowered the price target on Ascend Wellness Holdings (OTC: AAWH) to $13.00 (from $15.00) while maintaining a Buy rating.

The analyst commented, "In 3Q21, AWH grew revenue 13% driven by retail transaction counts and an increase in wholesale unit volume. With more product sold through the wholesale channel, gross margin dropped, but G&A leverage picked up the slack and EBITDA dollars grew 16%. While 3Q21 came in a little better than expected, AWH noted weakness in retail and less volume growth in the wholesale channel likely to reduce revenue in 4Q21. With transaction counts strong, but basket size decreasing, we see this as a macro issue compounded by the tough comp it created by having such a strong 3Q21. Unit growth into '22 will likely make this a temporary concern, we believe, but par-for-the-course construction delays and regulatory approvals on cultivation projects in IL and MA will likely lower 1H growth until NJ adult-use sales open in '22."

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