The growth of physical retail space in the Canadian cannabis space remains inconsistent, but it is still moving in the right direction, BofA Securities said in a note.

The Analyst: Bryan Spillane details findings of the research firm's bi-weekly Canada cannabis retail store tracker.

The Thesis: Throughout August, the cannabis industry added 46 stores across Canada, bringing its total count to 1,097. Since the start of 2020, Canada welcomed 431 new stores, representing a growth rate of 65% compared to the same period last year.

The growth in 2020 is roughly consistent with Canopy Growth Corp's (NYSE: GCG) forecast of around 1,200 retail cannabis stores operating by the end of the year.

Provincial Commentary: Ontario is Canada's most populous province and home to 158 stores as of the end of August. This happens to be "low" on a per capita basis as it implies one store for every 92,100 residents. By comparison, Alberta has 515 stores and this translates to one store for every 8,500 residents.

Quebec, Canada's second most populous province, added one new store since April and notably lags the rest of the country with one store for every 180,500 residents.

Bottom line, more stores are needed, especially in key population centers of Ontario and Quebec, the analyst wrote.