Following a large financing that shored up its balance sheet, GMP Securities analyst Martin Landry has resumed coverage of MedReleaf (TSX:LEAF) with the same bullish target.

On Wednesday, MedReleaf announced the closing of a $132.5-million financing. A large syndicate of financiers including GMP was led by Canaccord Genuity.

Landry says the LP now has enough money to fund its domestic and international expansion efforts.

“To speed time to market, we believe that MedReleaf will look to acquire an existing greenhouse facility and convert it for the production of cannabis,” the analyst says. “Under a scenario where LEAF spends $60m on a new greenhouse production facility, we estimate that the company could acquire a 400,000 sq.ft. greenhouse, using industry average metrics of $150 per sq.ft. Such an incremental footprint could generate ~30 tonnes of cannabis, thereby increasing MedReleaf’s production capacity by 85%. This would leave the company with ~$160m which could be used to support its existing international efforts.”

In a research update to clients today, Landry resumed coverage of MedReleaf with the same “Buy” rating and one-year price target of $35.00 on MedReleaf, implying a return of 75.9 per cent at the time of publication.

Landry thinks MedReleaf will generate EBITDA of $4.9-million on revenue of $46.2-million in fiscal 2018. He expects those numbers will improve to EBITDA of $47.8-million on a topline of $150.4-million the following year.