You could make a pretty compelling argument that Green Thumb Industries (OTC: GTBIF) ranks at the top of the list of U.S.-based cannabis operators. You could also make a similar argument that OrganiGram Holdings (NASDAQ: OGI) belongs at the top for Canadian cannabis producers.

So far in 2020, Green Thumb Industries has handily outperformed OrganiGram. But which marijuana stock is the better pick for long-term investors? 

The Case For Green Thumb Industries

Green Thumb Industries views itself as a cannabis consumer packaged goods (CPG) company. That's a pretty good description, but GTI is also a leading cannabis retailer. The company recently opened its 46th retail cannabis location in the U.S.

Business is booming even with the ongoing COVID-19 pandemic. GTI reported revenue of $102.6 million in the first quarter, a year-over-year jump of nearly 268% and up more than 35% from the previous quarter. Although the company isn't profitable yet, it's moving in the right direction. GTI's net loss in Q1 improved significantly from the previous quarter. The cannabis operator also delivered positive EBITDA and positive free cash flow from operations.

GTI should be able to grow simply by riding the wave in its existing markets. The company operates retail cannabis stores in 12 states, with many of these markets continuing to expand robustly. It owns licenses to open another 50 stores.

But GTI probably won't limit its growth to these 12 markets. There are currently 21 other states that have legalized either medical or recreational cannabis. More states are voting in November to potentially legalize some form of cannabis. GTI thinks that its total addressable market in the U.S. is around $80 billion, representing tremendous opportunities for long-term growth. 

Investors need to pay close attention to the balance sheets of cannabis companies. GTI appears to be in a solid financial position at this point, with cash and cash equivalents totaling $71.5 million at the end of March and total debt of $92.9 million.

The Case For OrganiGram

OrganiGram isn't the biggest Canadian cannabis producer. But some think it's the best. OrganiGram markets to all 10 Canadian provinces. Its cannabis products routinely win top awards. The company also boasts one of the lowest costs of cultivation in the Canadian cannabis industry. 

The bad news for OrganiGram is that there were some glaring problems with its fiscal 2020 Q2 results announced in April. Revenue slipped 8% from the previous quarter to 23.2 million in Canadian dollars. The company also posted negative adjusted EBITDA of CA$1.1 million after generating positive adjusted EBITDA in Q1. 

The good news, though, is that those problems should only be temporary. Part of the revenue dip in Q2 resulted from a one-time writedown for returns and price adjustments mainly related to cannabis oil products. But OrganiGram has made some changes that should get it back on track.

Even better, the company's long-term prospects remain solid. The Canadian cannabis derivatives market is still only in its early stages. OrganiGram's cannabis-infused chocolates and vapes are performing well so far. The company also recently won its largest international deal ever to supply dried cannabis flower to Israeli medical marijuana producer Canndoc.

OrganiGram's cash position looks pretty good. The company ended its fiscal Q2 with cash and short-term investments totaling CA$41.2 million. It can also draw CA$30 million from a term loan plus CA$25 million from a revolving loan. OrganiGram has long-term debt of only CA$295,000. 

Better Marijuana Stock

Green Thumb Industries' growth prospects in the U.S. are much greater than OrganiGram's growth prospects in Canada. While OrganiGram has fluctuated between delivering positive adjusted EBITDA and negative adjusted EBITDA, GTI has consistently generated positive EBITDA in recent quarters. In addition to these advantages, GTI also has a stronger cash position than OrganiGram does. 

I'm bullish about the long-term prospects for both Green Thumb Industries and OrganiGram. But if I had to pick just one of these stocks, it would be GTI.

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