Q1 of 2018 was a memorable one in the cannabis space, to be sure, with upward momentum to start off January, followed by a equally sharp decline in share prices through February and March.

And with rec legalization still months away, finding the winners among the dozens of contenders for Canada’s pot king is no easy task. Put your faith in the industry leader, says analyst Jason Zandberg with PI Financial, who rates Canopy Growth Corp. (Canopy Growth Stock Quote, Chart, News: TSX:WEED) a “Buy” and a Top Pick for Q2/18.

“We have chosen Canopy Growth Corp. as our Q2 Top Pick, as the company has the largest domestic production profile in Canada and their International Portfolio is the furthest reaching among Canadian LP’s,” says Zandberg in a special situations note to clients on Thursday. “Canopy has already secured supply agreement with four provinces and we expect many more agreements in the months leading up to legalization.”

Zandberg says that Canopy is leading the pack when it comes to diversification, with investments in 28 companies across the cannabis space and eight international investments that give it exposure in seven countries worldwide.

“We anticipate that the international medical cannabis market will be significantly larger than the Canadian medical and recreational markets,” says the analyst. “Although Canopy Growth has an impressive cultivation empire, the Company has also been investing in innovation. Canopy Health Innovations is a 43.9 per cent owned business that is focused on developing innovative cannabis- based related products. This includes developing delivery mechanisms as well as effective formulations to treat a variety of illnesses.”

The analyst forecasts revenues of $301.0 million, $780.3 million and $1,043 million for FY19, FY20 and FY21, respectively, and EBITDA of $28.0 million, $179.1 million and $282.5 million for FY19, FY20 and FY21, respectively.

Zandberg gives a risk rating of “Speculative” to WEED and a 12-month target of $45.00, which represents an EV/EBITDA multiple of 30x his FY21 EBITDA. The $45.00 target represents a projected return of 34 per cent at the time of publication.