One-glance verdict
Overvalued
$2.38 our estimate vs market $3.46
Wall Street consensus: $2.97 (25.0% higher than our fair-value estimate)
45% above our estimate, beyond the bull case
Fundamentals snapshot
Cronos Group Inc.
CRON · NGM · Healthcare · Drug Manufacturers - Specialty & Generic
Current price
$3.46
52-week range
$2.28 - $3.91
Market cap
$1.27B
Balance sheet
Healthy
-1,499.77x Concerning
Net cash $739.96M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 40.7% last year.
- Reward Returns 6.1% on equity, ahead of 66% of its peers.
- Reward Free cash flow was positive in 2/10 years.
- Risk Stock trades 17.8% above its 5-year average P/E.
What this company does
Cronos Group Inc.
Cronos Group sells various cannabis products like dried flower, edibles, and vapes through brands such as Spinach and Lord Jones. Their money mainly comes from selling these products across Canada, Israel, and other international markets. This matters because it shows how they are trying to build their business in the growing legal cannabis industry.
How the company got here
Cronos Group Inc. was founded in 2012 with the initial goal of capitalizing on companies applying to become licensed medical cannabis producers in Canada [7, 8]. The company, originally named PharmaCan, rebranded to Cronos Group and began trading on the Nasdaq in February 2018, marking a significant milestone as the first cannabis company to list on a major U.S. stock exchange [8]. This move signaled institutional investor interest in the burgeoning cannabis sector [8]. Over the years, Cronos has focused on research, technology, and product development to build a diverse portfolio of cannabis products [1, 5]. The company has expanded its operations internationally, including in Israel and Germany, and has pursued strategic partnerships to enhance its capabilities and market access [5, 7].
What it actually does
Cronos Group is a global cannabinoid company that cultivates, produces, distributes, and markets cannabis and cannabis-derived products [3, 14]. They focus on developing innovative products through research and development, aiming to elevate the consumer experience [1, 4]. Their product offerings include dried cannabis flowers, pre-rolls, oils, vaporizers, edibles, and tinctures [3, 14]. These products are marketed under various brand names and are intended for adult consumers in both wellness and recreational markets [1, 4].
Rest of World
This segment encompasses Cronos Group's operations outside of the United States, including cultivation, manufacturing, and marketing of cannabis and cannabis-derived products for both medical and adult-use markets [12]. This includes their significant presence in Canada and international expansion into markets like Israel and Germany [1, 7]. The company develops and sells a variety of cannabis products, such as dried flowers, pre-rolls, oils, and edibles, under brands like Spinach, Lord Jones, Lit, and Peace Naturals [3, 14]. This segment represents the core of Cronos Group's global business and is where they aim to capture a significant share of the evolving cannabis market [12].
United States
The United States segment of Cronos Group focuses on the manufacture and distribution of hemp-derived cannabidiol (CBD) infused products [12]. CBD is a compound found in cannabis that does not produce a "high" and is often used for its potential wellness benefits [12]. This segment allows Cronos to tap into the U.S. market with products that are distinct from the THC-containing (tetrahydrocannabinol, the psychoactive compound in cannabis) products available in other regions [12]. Brands like Lord Jones and PEACE+ operate within this segment, offering a range of CBD-infused items [10, 11, 12].
What management is betting on now
Cronos Group's management is focused on advancing cannabis research, technology, and product development to create innovative and sophisticated cannabinoid-based products [1, 5]. They are investing in R&D to develop unique product lines, including those with rare cannabinoids, and are exploring new product formats like edibles and vapes [5, 9]. Strategic partnerships and acquisitions are also key, as they provide access to specialized expertise and accelerate market penetration [5]. The company aims to build a strong portfolio of iconic brands and believes that future success in the cannabis market will depend on product quality, innovation, and the ability to meet diverse consumer preferences [4, 5, 6].
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$4.18M
FY2025 Q1
$-17.35M
FY2025 Q2
$-1.02M
FY2025 Q3
$8.83M
FY2025 Q4
$9.70M
FY2026 Q1
$9.02M
FY2026 Q2
$22.27M
FY2026 Q3
$24.39M
Revenue
$63.45M
Net income
$13.80M
Diluted EPS
0.04
Operating cash flow
$34.34M
Free cash flow
$24.39M
Fetching…
Sources
Revenue
$53.01M
Net income
$32.09M
Diluted EPS
0.09
Operating cash flow
$24.01M
Free cash flow
$22.27M
Fetching…
Sources
Revenue
$45.21M
Net income
$13.75M
Diluted EPS
0.04
Operating cash flow
$10.90M
Free cash flow
$9.02M
Fetching…
Sources
Revenue
$44.53M
Net income
$-1.82M
Diluted EPS
-0.01
Operating cash flow
$11.84M
Free cash flow
$9.70M
Fetching…
Sources
Revenue
$36.34M
Net income
$25.96M
Diluted EPS
0.07
Operating cash flow
$13.31M
Free cash flow
$8.83M
Fetching…
Sources
Revenue
$33.45M
Net income
$-39.71M
Diluted EPS
-0.10
Operating cash flow
$2.82M
Free cash flow
$-1.02M
Fetching…
Sources
Revenue
$32.26M
Net income
$6.12M
Diluted EPS
0.02
Operating cash flow
$-2.10M
Free cash flow
$-17.35M
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Sources
Revenue
$30.30M
Net income
$43.73M
Diluted EPS
0.12
Operating cash flow
$7.72M
Free cash flow
$4.18M
Fetching…
Sources
Is it cheap or expensive?
Fair value $2.38 vs current price $3.46
Wall Street consensus is the average analyst price target: $2.97 (25.0% higher than our fair-value estimate).
Our most-likely fair value is $2.38 a share — about 31.3% below today's price of $3.46, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $740.0M - more cash than debt. Interest coverage -1499.8x.
Net debt
$-739.96M
Interest coverage
-1,499.77x
Cronos Group Inc.'s profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 5 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
CRON
BASELINE
Cronos Group Inc.
Total debt $1.21M Interest coverage -1,499.77x This is the baseline the peer rows are being compared against.
Total debt $371.93M Interest coverage -1.85x Neither company has much profit cushion over interest right now.
Total debt $173.30M Interest coverage -1.91x Neither company has much profit cushion over interest right now.
Total debt $114.41M Interest coverage -0.59x Neither company has much profit cushion over interest right now.
Total debt $15.99M Interest coverage -25.79x Neither company has much profit cushion over interest right now.
Total debt $22.31M Interest coverage -35.66x Neither company has much profit cushion over interest right now.
What you should know
The case for and against CRON
3 Rewards
1 Risk
Rewards
-
Revenue grew 40.7% last year.
-
Returns 6.1% on equity, ahead of 66% of its peers.
-
Free cash flow was positive in 2/10 years.
Risks
-
Stock trades 17.8% above its 5-year average P/E.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
21.64x
Forward P/E
-86.56x
P/B
1.19x
P/S
6.15x
EV/EBITDA
23.97x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
46.3%
Operating margin
14.0%
Net margin
28.0%
ROE
6.1%
ROA
0.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.00x
Current ratio
12.71x
Quick ratio
11.76x
Total debt
$1.21M
Total cash
$741.17M
Growth
How the business has been compounding
Revenue TTM
$206.20M
Revenue 5Y CAGR
22.8%
EPS TTM
0.16
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$81.08M
Free CF TTM
$149.00K
FCF margin
0.1%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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