Medical Marijuana Average Monthly Spending – A Proxy for the Recreational Use Consumer

May 15, 2024

Key Points:

  • U.S. Cannabis revenue growth hinges significantly on the emergence of new state markets.
    Ohio, for instance, is set to kick off its recreational sales next month, a move that could
    potentially be replicated in Florida (through a ballot initiative) and Pennsylvania (via a legislative
  • There has been a steady decline in medical marijuana cardholder counts (and revenues) in
    states that have legalized recreational use (cardholders, in turn, become consumers of a rec
  • Based upon an analysis of average spending trends in several Medical Marijuana markets, we
    estimate, conservatively, a potential of $3.8B for Ohio; Florida, and Pennsylvania, $5.6B, and
    $4.2B, respectively.
  • For a sense of reasonableness, we applied the same methodology and assumptions to the
    Colorado market, established ten years ago for all intent and purposes.  This exercise revealed ~
    $1.5B, which approximates today's market.
  • Consensus revenue estimates over the next five years (and likely current valuations of publicly
    traded operators) do not include the incremental lift from these new markets. 
  • The timing of a complete rollout is unknown and, as we have learned over the years, difficult to

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