Curaleaf (LDVTF) is the latest multi-state cannabis operator to go public through a reverse takeover. The Massachusetts-based cannabis company priced its shares at C$11.45 on Monday, but on its first day of trading on the Canadian Securities Exchange, the stock fell almost 20% -- closing at C$7.40. Lucky for investors, it jumped back 14% and managed to close on Tuesday at $8.35. Certainly, this isn't what investors were expecting following the intense increases in stocks like Tilray (TLRY) and Canopy Growth (CGC) .

"If they were expecting a quick windfall, maybe worry, although some of these cycles rebound well. It could take a while given the broader market and continued uncertainty," said Evan Eneman, CEO of ELLO, a cannabis advisory service. "This selloff and cooling of the cannabis stocks in Canada and their U.S. listings is nothing new. This has been the same cycle for the past two years, as major milestones have been achieved in the industry, meaning the runup of anticipation and then the selloff to take gains by early investors."

However, part of this could be attributed to the confusion over the numerous multi-state operators that have hit the market in the last six months. It seems they all claim to be the largest, have the biggest footprint and are the most profitable.

Curaleaf had been known as Palliatech until just recently, and was founded in 2010. The company is mostly on the east coast, even though these markets have fewer licenses and are characterized by the restrictive lists of conditions for patients. It is located in 12 states and owns and operates 28 dispensaries, 12 cultivation sites and 9 processing sites.

CEO Joe Lusardi said, "Our view is that the East coast has been conservative, but appropriately so. Oregon and Washington have few regulations and no limit on operators." These states have also experienced severe price declines due to oversupply. There has also been a diversion of inventory to the black market, as growers dump unsold inventory.

Lusardi said that the company is currently servicing 33,000 unique patients and employs 875 people. The company has a C$4 billion valuation and sold roughly $400 million in private placements prior to going public.

By comparison, Acreage Holdings has raised $350 million and is located in 14 states, soon to be 15 states. It is also doing a reverse takeover with an Ontario company called Applied Inventions Management Corporation. The initial trading is expected near November 11, and it is expected to be valued between $2 and $2.5 billion.

iAnthus (ITHUF) has been trading longer than Curaleaf and with its recent acquisition of MPX Bioceutical (excluding MPX International), will include operations and cannabis licenses in 10 states. They will operate in 56 retail locations and have 14 cultivation/processing facilities. Yet, the company only has a market cap on the OTC stock of $321 million and C$400 million for the CSE stock. It has revenues of C$2.7 million.

The question then is whether Curaleaf is overpriced or iAnthus is a bargain. Is iAnthus appropriately priced because it has been trading longer and Curaleaf gets the new stock premium like a shiny new toy? While the iAnthus stock price has risen 153% over the past year, its valuation still pales in comparison to these other multi-state operators.

"As with most investments, you're primarily investing in the team. That's the best way to differentiate one multi-state operator from another," said Enerman. "Certainly you would also want to consider the assets in each market, which markets they're in and the dynamics of the markets (open v. closed), which ones are revenue producing versus cost centers and how that all aligns for the overall consolidated entity. Many operators have been buying revenue, and expensively as well, and that model doesn't always work over the long term if there isn't a good integration plan and ability to execute."

The next multi-state operators that investors should be prepared to begin hearing more about are Verano Holdings and Grassroots Cannabis. Verano is located in four states and owns six dispensaries, but could end up with 30-60 licenses due to some upcoming announcements. Grassroots Cannabis is in six states and owns 27 licenses. Both claim to be on their way to becoming the largest multi-state operator.

Enerman added, "As competition ramps up, revenues slow or dry up and companies struggle to find free cash flow, we'll see who has the better model and ultimately you can start to see those signs in how management views and monitors their business, taking into account all risk factors as well as opportunities for growth."