Jushi Holdings (JUSHF 7.58%), New Lake Capital Partners (NLCP -0.22%), and Ascend Wellness Holdings (AAWH 2.86%) are some of the lesser-known names in cannabis, especially considering two of the three turned a profit through the first six months of this year and the third is edging closer to profitability. There's plenty of growth ahead for cannabis companies. Global legal marijuana sales, estimated at $22 billion in 2022, are projected to have a compound annual growth rate of 28% over the next six years, becoming a $97 billion business by 2026, according to a report by Facts and Factors. However, investors need to be patient and keep a long-term focus, as cannabis stocks have been depressed so far this year.

I like all three of these cannabis companies. Though they don't sell their shares over a major exchange, their lack of notoriety has meant that their valuations are nowhere close to being oversold, if you compare their respective price-to-sales ratios to industry leaders'. That provides more opportunity for upside for long-term investors.

TRUL PS Ratio Chart

TRUL PS Ratio data by YCharts

NLCP PS Ratio Chart

NLCP PS Ratio data by YCharts

Jushi Holdings attractive as a takeover target or as a stand-alone

Jushi Holdings has seen its shares drop by more than 51% this year, though not as much as industry benchmarks such as the AdvisorShares Pure Cannabis ETF, which is down more than 63%, or the ETFMG Alternative Harvest ETF, which is down more than 53%. Yet that's hardly comforting to Jushi investors.

Jushi is a relatively small multi-state operator (MSO) but is aggressively growing. It has 35 stores but has plans to have 50 by the end of 2023. It also is well situated in three key medical marijuana states that are expected to open to adult-use sales in the near future: Pennsylvania, Virginia, and Ohio. It has 18 dispensaries in Pennsylvania; four in Virginia, with another two planned; and one in Ohio, with four more planned.

Through six months, the company reported revenue of $134.6 million, up 50.5% over the prior year. In the second quarter, it reported $72.7 million in revenue, up 52.8% year over year and up 17.6% sequentially. It had net income of $12.1 million in the quarter, up from net income of $3.6 million in the same period last year, though because of the company's sale of stock, it had an earnings per share (EPS) loss of $0.15, compared to an EPS loss of $0.09 in the second quarter of 2021.

The biggest concern with Jushi is that it only has $43 million in cash, as of the second quarter, though with only $200 million in total debt, it can easily raise more money for operations. The company also issued guidance that placed its expected yearly revenue between $320 and $350 million, up from $209 million in 2021. The company's strong positions in potential adult-use states and its relatively low debt also make it an attractive buyout candidate for another MSO.

NewLake Capital Partners thriving in a big shadow

NewLake Capital Partners has seen its shares drop more than 45% so far this year. It is a real estate investment trust (REIT) that is a landlord for cannabis companies, which is a very specialized field. With 31 properties comprising 1.7 million square feet across 12 states, it is dwarfed by the largest cannabis REIT, Innovative Industrial Properties, which has 111 properties comprising 8.7 million square feet across 19 states. As such, NewLake is easily overlooked, which would be a mistake for investors. The company minimizes risks with triple-net leases that put most expenses on tenants.

NewLake just raised its dividend for the sixth consecutive quarter, this time by 5.7% to $1.48 per quarterly share, giving it a yield of around 9.55%.

The stock's declining price is in stark contrast to the company's financials, making it a great long-term opportunity for investors. In the second quarter, the company reported revenue of $10.5 million, up 59% year over year. More importantly for a REIT, adjusted funds from operation (AFFO) totaled $8.7 million, up 7% over the same period in 2021. The company's net income was reported as $3.8 million, down from $5 million, year over year. Both the company's AFFO and net income were impacted by one-time charges for executive severance.

Through six months, NewLake's position looks even stronger with revenue of $20.5 million, up 86% year over year; net income of $8.8, up 109% over the same period in 2021; and AFFO of $16.8 million, up 102% year over year. Through six months, the company's properties were fully leased, with no defaults or rent deferrals, and its average remaining lease term was 14.5 years.

Ascend Wellness is at a crossroads

Ascend Wellness is a small MSO with 22 dispensaries in six key cannabis states; Illinois, Michigan, Ohio, Massachusetts, New Jersey, and Pennsylvania. The company's stock is down more than 69% so far this year.

The company just opened its first Pennsylvania dispensary in Scranton, but it has plans for five others in the state. It also is in the process of adding adult sales to its three medical marijuana dispensaries in New Jersey.

In the second quarter, Ascend reported revenue of $97.5 million, up 15% sequentially and 17% year over year. The company also trimmed its net income loss to $21.2 million, compared with a loss of $27.8 million in the same quarter in 2021. Through six months, the company said it had revenue of $183 million, up 22% year over year, and it cut its net losses by 47.3% to $48.9 million.

Like Jushi, as a smaller MSO, Ascend could be a takeover possibility, or it could go in the other direction by becoming active in acquisitions. It canceled its proposed $88 million acquisition of MedMen in August, but that had more to do with concerns about MedMen's assets than Ascend's desire to grow through acquisitions. The company may also try to grow with smaller acquisitions, as it did in August by beginning the process of buying three licensed dispensaries that were being built in Cincinnati, Piqua, and Sandusky, Ohio, by Ohio Patient Access, giving Ascend five dispensaries in the state.