Kovler cited the company’s strong balance sheet following its recent “first-of-its-kind” refinancing.
Green Thumb Industries Inc. (CSE: GTII) (OTCQX: GTBIF) could repurchase up to $50 million worth of its shares in the next year, the company announced Monday.
The Chicago-based company said its board authorized buying back up to 10,573,860 of its shares starting Sept. 23 and running until Sept. 22, 2025. It follows a previous buyback that saw Green Thumb repurchase 6.5 million shares for $73.3 million.
Green Thumb founder and CEO Ben Kovler said in a statement that the move offers “greater flexibility to use our cash reserves to repurchase more shares should the opportunity present itself.”
He added that he believes in the “value-creating nature of share buybacks done at attractive prices.”
The announcement was made just days after Green Thumb secured a $150 million credit facility led by Valley National Bank, which the company called a “first-of-its-kind” for the U.S. cannabis industry. The five-year facility carries an interest rate of the secured overnight financing rate (SOFR) plus 5%.
Kovler cited the company’s strong balance sheet following the refinancing, adding that Green Thumb remains “open to strategic M&A, capital expenditures into the business and unique investment opportunities.”
The company isn’t obligated to purchase any shares and can suspend the program at any time.
It added, “The company does not expect to incur debt to fund the share repurchase program. The actual number of shares purchased, timing of purchases and share price will depend upon market conditions at the time and securities law requirements. All shares acquired will be returned to treasury and cancelled.”
According to recent analysis by Viridian Capital Advisors, Green Thumb carries less than 2x Debt/EBITDA and relatively low EV/2024 EBITDA valuation multiples. Viridian suggested such companies are “good candidates for debt-funded equity repurchases and/or acquisitions using relatively high percentages of debt financed cash consideration.”
The firm also noted that Green Thumb “has consistently ranked as the strongest MSO credit” and could potentially achieve yields of 10% or less in future debt offerings.
[[{“value”:”Kovler cited the company’s strong balance sheet following its recent “first-of-its-kind” refinancing.
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