Late last week, Wall Street investment firm Jefferies initiated coverage on embattled marijuana stock Aphria (NYSE:APHA) with a buy rating and a price target of 15 Canadian dollars ($11.10), implying more than 70% upside from where Aphria had closed on its previous day of trading.

Owen Bennett, the head analyst at Jefferies covering the cannabis industry, noted that Aphria scored third highest on an internal strategic scorecard, behind only Canopy Growth and Aurora Cannabis, which happen to be the respective No.'s 2 and 1 in terms of peak production potential in Canada.

More specifically, Bennett pointed out in his note that "[Aphria's] valuation is the cheapest across our space, with allegations around inflated assets/insider deals weighing." It's for this reason that Bennett and his firm foresee significant upside to Aphria.

A cannabis leaf laid atop a one dollar bill, with George Washington's eyes peering between the leaves.

Image source: Getty Images.

News flash: These pot stocks are even cheaper than Aphria

However, Yours Truly would contend that it's not the cheapest in the marijuana space. Despite Aphria being valued at 22 times next year's earnings per share and only 3.1 times next year's projected revenue, the following three marijuana stocks look to be even cheaper.

KushCo Holdings

With the understanding that value can be measured in a variety of ways, including by forward price-to-earnings ratio and/or by future price-to-sales ratio, ancillary cannabis stock KushCo Holdings (NASDAQOTH:KSHB) is remarkably inexpensive on the basis of future price to sales. According to Wall Street, KushCo projects for $243 million in sales in 2020, which works out to a multiple of only 1.66 times its current market cap.

If you're wondering why KushCo is receiving no love from Wall Street, the answer is twofold. First, as a provider of packaging and branding solutions for the global cannabis industry, it's received some blame for Canada's packaging shortage, which is one of a handful of reasons Canada has experienced a notable supply shortage of marijuana in dispensaries.

Secondly, KushCo's gross margin has come in below its target of 30% for multiple quarters now, with part of the reason being that the company has absorbed tariff costs associated with vape products imported from China. Recently, however, management noted its intent to pass these costs onto consumers, which shouldn't be a problem considering the high demand for derivative consumption options beyond smoking dried flower. As a result, KushCo's margins should improve significantly in the quarters that lie ahead.

Meanwhile, KushCo should benefit from growing demand for compliant packaging and branding solutions, increased use of vape products, and improved demand for hydrocarbon gases and solvents, which are used in the respective production of oils and concentrates. KushCo is a supplier of both hydrocarbon gases and solvents.

Although recurring profitability may still be 12 to 18 months out, with the company reinvesting in the infrastructure needed to thrive as an ancillary player, pretty much no marijuana stock is cheaper than KushCo on the basis of price to sales.

Two miniature shopping carts, with one holding a cannabis flower, and the other holding vials of cannabidiol oil.

Image source: Getty Images.

Trulieve Cannabis

Another marijuana stock that's cheaper than Aphria is U.S.-focused multistate cannabis operator Trulieve Cannabis (NASDAQOTH:TCNNF). Although its forward price to sales of 4.43 is a bit higher than Aphria, no other pot stock has a lower forward price-to-earnings ratio than Trulieve at 15.

The secret to Trulieve's success has been its laser focus on Florida's medical marijuana market. Being based in Florida, Trulieve has opened 27 dispensaries in the Sunshine State, which caters to an older-than-average population that's more likely to benefit from medical cannabis. Whereas most of its competitors have strung themselves thin by trying to open retail locations, grow farms, and processing sites in multiple states, Trulieve Cannabis has really focused its investments on its home turf. If Florida winds up legalizing recreational marijuana in 2020, it would simply be a feather in the cap for the already successful Trulieve.

Then again, this is a company that envisions a multistate presence. Late last year, it wound up acquiring dispensary operations in California and Massachusetts. California, the fifth-largest economy in the world by GDP, could be generating as much as $11 billion in annual pot sales by 2030, making it a coveted target for most dispensary operators.

So, if all is going so well, why is Trulieve valued at a forward P/E that's actually lower than the average company in the broad-based S&P 500? My best guess would be that Florida is a prime target for a number of major dispensary operators, including Curaleaf Holdings and MedMen Enterprises. It's possible that Wall Street is worried about a future margin squeeze coming as the cannabis market becomes saturated in the Sunshine State. Thankfully, Trulieve's homegrown roots in Florida should help play a role in shielding it from a growing number of competitors.

A vial of cannabidiol oil on a table next to hemp leaves.

Image source: Getty Images.

Charlotte's Web Holdings

A final pot stock that looks to offer better value than Aphria is hemp-oil and hemp-derived cannabidiol (CBD) products manufacturer and distributor Charlotte's Web Holdings (NASDAQOTH:CWBHF). As of this past Wednesday, Charlotte's Web was trading at 4.13 times forward sales, and less than 19 times Wall Street's consensus earnings per share estimate for 2020.

Make no mistake about it, Charlotte's Web has had little trouble getting its hemp-oil and CBD-based products (oils, topicals, and capsules) into retail stores, and to consumers via e-commerce sales, for more than two years. But the floodgates are really set to open now that the farm bill has become law. Signed by President Trump in December, the farm bill legalized the production of hemp and hemp derivatives, thereby legalizing Charlotte's Web's products across the country, and providing a platform for physical retailers to get on board with the CBD craze -- CBD being the nonpsychoactive cannabinoid best known for its perceived medical benefits.

In order to meet this growing demand for hemp-oil and hemp-CBD products, the company announced in its recent first-quarter operating results press release that it'll be more than doubling its hemp-growing acreage in 2019 to 700 acres from 300 acres. This is a big reason behind Wall Street's projected sales growth for the company of 111% in 2019 and 120% in 2020.

Similar to KushCo and Trulieve, you're probably wondering why, if things are going so well for Charlotte's Web, it's being valued so cheaply on a price-to-sales and forward P/E basis. The reasons include a recent 8.05 million share sale by existing shareholders at a 25% discount, as well as the weakest sequential quarterly sales growth in the company's history in the first quarter, likely a result of maximizing its 300 acres of hemp yield in the fourth quarter. But neither of these concerns is a long-term worry for the company, making it a more intriguing bargain than Aphria.