A U.K.-based cannabinoid drugmaker has just received a major endorsement from Wall Street.

In a research note, reported on by Barron’s, JPMorgan slapped a $134 price target on GW Pharmaceuticals’ (GWPH) American depositary shares, implying that the stock could rise by about 32%. The bank, which helped raise $345 million for the drug developer in an October stock offering, described GW as “a clear leader” in its field and predicted that the company’s cannabis-derived drug Epidiolex is poised to surpass $1 billion in annual sales by 2023.

Investors responded to news that one of Wall Street’s biggest banks is backing the stock by sending the shares up 3.72% on Wednesday and a further 5.87% in pre-market trading.

Blockbuster Sales for Epidiolex

GW’s Epidiolex became the first cannabis-derived drug to gain approval from the Food and Drug Administration last summer. The drug proved during rigorous clinical trials that it can reduce seizures among children suffering from congenital epilepsies.

Analyst Cory Kasimov believes it's only a matter of time before doctors start prescribing Epidiolex to epilepsy patients. This massive breakthrough, combined with a lack of competition, should turn it into a blockbuster seller, he added.

Kasimov noted that GW has other cannabinoids in its pipeline, other than Epidiolex and Sativex, its cannabinoid-based therapy designed to treat spasticity associated with multiple sclerosis, and is unlikely to see generic drug competition until the late 2020s.

"In our view, the company is a clear leader in the field of cannabinoid science and drug development, now with two regulatory approvals (Epidiolex and Sativex) under its belt, a respectable pipeline of additional assets across an array of therapeutic indications, and a proprietary research/manufacturing platform that should enable it to sustain further growth," the analyst wrote in the note.

The Motley Fool is similarly bullish on the stock, but warned that GW faces competition from an experimental therapy from Zogenix Inc. (ZGNX).