Organigram Holdings Inc. sold the second-most amount of recreational cannabis in Canada, after only Canopy Growth Corp., in the most recent quarter. It sold twice as much pot as rival Aphria Inc.

That success isn’t showing up in Organigram’s US:OGRMF OGI, -0.43% valuation, though — the market cap is 5% of Canopy’s CGC, -8.97% WEED, -8.60% and half of Aphria’s APHA, -2.20% APHA, -1.49% , according to FactSet data. That is likely a large reason for the company’s move to list its stock on the Nasdaq, which should happen in about a month after Organigram filed for a listing on Friday.

Currently, like the vast majority of the cannabis sector, Organigram's investor base is primarily retail investors, not institutional investors that typically buy larger blocks of stocks. According to FactSet, funds own just more than 11% of Organigram shares — the vast majority of which is owned by two exchange-traded funds — while about 80% of the float does not have to disclose holdings, which suggests most are retail investors. On average, stocks in the S&P 500 index SPX, -2.37% show an inverse ownership trend, with about 88% ownership by funds.

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Attracting larger investors is also one of the likely reasons the company has applied for a Nasdaq listing. Highly valued rivals such as Canopy, Cronos Group Inc. CRON, -4.89% CRON, -4.11% and Aurora Cannabis Inc. ACB, -29.37% ACB, -29.08% are listed on major exchanges in the U.S.

Organigram Chief Executive Greg Engel, who once helmed the Privateer Holdings-backed Tilray Inc. TLRY, -12.39% , told MarketWatch in Toronto last week that he believes more institutions are taking positions in cannabis companies. Engel said that the company’s goal is to attract more long funds and investors looking for value over time.

“We’ve seen that it has driven value for the companies that list on senior U.S. exchanges,” Engel said, while declining to comment on the share price relative to its peers. “So there’s a differentiation if you’re accessing a new market at a different level.”

Based on Moncton, New Brunswick — a town of roughly 85,000 residents on Canada’s east coast — Engel said that Organigram’s sales in Atlantic Canada consistently make it one of the top two or three producers there. In Alberta, which has allowed private retailers to set up brick-and-mortar stores, unlike provinces such as Quebec that operate government shops, Engel said Organigram is one of the top three providers.

In its most recent quarter, Organigram sold slightly less than 5,000 kilograms of dried cannabis and its equivalent across Canada, almost all of it recreational pot, more than 1,000% growth over the year-earlier period. With the federal excise tax removed, Organigram sold C$26.9 million worth of pot.

By comparison, Canopy Growth sold 8,708 kilograms of pot in the March quarter. Aurora sold 6,999 kilograms, but only about half of Aurora’s sales are for the recreational market, with the rest going to medical marijuana patients. Hexo Corp. HEXO, -6.47% , HEXO, -4.25% a closer comparison without the massive heft of Constellation Brands Inc.’s STZ, -1.02% $4 billion investment in Canopy Growth, sold 2,537 kilograms of recreational pot and 157 kilograms of medical weed in the most recent quarter.

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GMP Securities analyst Martin Landry said the value discrepancy between Organigram and rivals with lower recreational-pot sales “is hard to explain.” The bullish analyst said Organigram’s low production costs — despite using indoor facilities versus the historically cheaper greenhouses — and the company’s smaller cost structure has resulted in larger profits than many of its competitors.

“There are less than five companies that generate positive EBITDA [earnings before interest, taxes, depreciation and amortization]” in the cannabis industry, Landry said. “What’s impressed me the most is their profitability.”

Landry has a C$15 ($11.15) price target and a buy on the stock.

Despite the company’s relatively strong sales, Engel said Organigram is still viewed by investors as a company focused on a specific region of Canada that isn’t as highly populated.

“We’re still seen as a regional, Atlantic Canada, player — even though we’re a national player and one of only three companies in all 10 provinces,” Engel said. “I always say to investors, we’re building a long-term sustainable, profitable business.”