Cresco Labs (CL) AI Stock Analysis

• Market Cap: $321.22M
• Dividend Yield: N/A
• Average Volume (3M): 490.23K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.01
• Revenue Growth: -4.38%
• EPS Growth: 46.68%
• Country: CA
• Employees: 2,900
• Sector: Healthcare
• Sector Strength: 41
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): -0.05
• Shares Outstanding: 337,799,930
• 10 Day Avg. Volume: 1,133,258
• 30 Day Avg. Volume: 490,229
• PEG Ratio: 0.18
• Price to Book (P/B): 0.52
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 2.19
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $2.12
• Price Target Upside: 182.43% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 51 Neutral
• Price Target: C$0.50 ▼(-33.33%Downside)

Cresco Labs shows promise with strategic market expansions and improving cash flows, but faces challenges with revenue declines and high leverage. Technical indicators suggest bearish momentum, and valuation metrics indicate potential overvaluation, keeping the overall score moderate.

Positive Factors

Cash Flow

Cresco Labs generated positive operating cash flow of $30.5M in the quarter and finished the period with its highest cash balance in three years.

Growth Prospects

Cresco’s vertically integrated operations in markets such as Ohio, Pennsylvania, and Florida are expected to drive growth into 2025 and beyond alongside new markets like Kentucky.

Negative Factors

Gross Margin

Adjusted EBITDA was slightly below forecast, as lower gross margin translated into lower EBITDA margin.

Revenue Decline

Cresco reported Q1 revenue of $165.8M, down 5.8% sequentially and down 10.1% year-over-year.

Cresco Labs Business Overview & Revenue Model

Company Description

Cresco Labs Inc., together with its subsidiaries, cultivates, manufactures, and sells retail and medical cannabis products in the United States. It provides cannabis in flowers, vape pens, live resins, disposable pens, and extracts under the Cresco brand; vape carts, vape pens, flower, popcorn, shake, pre-rolls, shorties, and concentrates under the High Supply brand; vapes and gummies under the Good News brand; vapes and edibles under the Wonder Wellness Co. brand; and tinctures, capsules, salves, and sublingual oils under the Remedi brand, as well as cannabis products under the Reserve brand. The company also offers cannabis flowers under the FloraCal brand; and chocolate and toffee confections, fruit-forward gummies, hard sweets, and taffy under the Mindy's Edibles brand, as well as licenses the Kiva brand, which produces cannabis infused edibles, including chocolate confections, gummies, mints, and tarts. In addition, the company offers cannabis-infused edibles under the Sunnyside brand. As of December 6, 2022, it owned and operated 55 dispensaries. The company was founded in 2013 and is headquartered in Chicago, Illinois.

How the Company Makes Money

Cresco Labs generates revenue through multiple streams centered around the cannabis market. The primary source of revenue is the sale of cannabis products, which includes flower, edibles, concentrates, and vapes. These products are sold through both wholesale channels to dispensaries and retail operations at the company's owned and operated dispensaries. Additionally, Cresco Labs earns income through licensing agreements for its branded products, allowing other businesses to produce and sell under its well-known brands. The company also benefits from strategic partnerships and acquisitions that expand its market presence and operational capabilities, enhancing its ability to generate revenue across different states. Regulatory compliance and operational efficiency are significant factors contributing to its earnings potential in the highly competitive cannabis industry.

Cresco Labs Financial Statement Overview

Summary

Cresco Labs is on a path to recovery with improving margins and cash flows, despite ongoing revenue challenges. The company has shown operational improvements with positive cash flow, though high leverage and declining equity remain concerns. Continued efforts in enhancing operational efficiency and managing debt levels will be crucial for future stability and growth.

Income Statement

Cresco Labs has experienced a decline in total revenue over the past two years with a revenue decrease from $842.7M in 2022 to $724.3M in 2024. Despite having a strong gross profit margin of 50.3% in 2024, the company faces challenges with sustained net losses, though the net loss has decreased from -$175.5M in 2023 to -$74.4M in 2024. EBIT and EBITDA margins have shown improvement, indicating a potential turnaround in operational efficiency.

Balance Sheet

The debt-to-equity ratio stands at 1.35 in 2024, reflecting a moderate level of leverage. The equity ratio remains relatively stable at 35.0%, indicating a balanced approach toward asset financing. However, the decline in stockholders' equity from $505.7M in 2023 to $474.9M in 2024 suggests challenges in preserving equity value. Return on equity has improved as net losses have narrowed.

Cash Flow

Cresco Labs shows an improvement in operating cash flow, increasing from $58.6M in 2023 to $132.5M in 2024, which is a positive sign of better cash management. Free cash flow has also turned positive, reaching $109.0M in 2024, a significant improvement from $0.7M in 2023. This is indicative of stronger operational performance and better capital expenditure management.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
724.34M	770.88M	842.68M	821.68M	476.25M
	Gross Profit
364.45M	362.37M	407.01M	406.35M	283.94M
	EBIT
107.29M	-87.82M	65.75M	87.97M	58.30M
	EBITDA
114.28M	-14.36M	-10.66M	-159.63M	5.23M
	Net Income Common Stockholders
-74.44M	-175.52M	-215.84M	-296.83M	-36.56M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
137.56M	103.43M	119.34M	223.54M	136.34M
	Total Assets
1.36B	1.36B	1.58B	1.78B	1.33B
	Total Debt
639.64M	682.76M	670.17M	624.74M	354.58M
	Net Debt
502.08M	579.33M	550.83M	401.19M	218.24M
	Total Liabilities
967.18M	930.40M	996.01M	982.73M	608.37M
	Stockholders Equity
474.85M	505.69M	627.04M	755.55M	574.45M
Cash Flow		Free Cash Flow
108.99M	681.00K	-67.39M	-82.57M	-91.21M
	Operating Cash Flow
132.48M	58.56M	18.74M	14.49M	-10.83M
	Investing Cash Flow
-25.23M	-44.59M	-36.58M	-163.93M	-44.11M
	Financing Cash Flow
-71.48M	-26.91M	-86.64M	235.00M	142.67M

Cresco Labs Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.75
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CL, the sentiment is Negative. The current price of 0.75 is below the 20-day moving average (MA) of 0.90, below the 50-day MA of 0.96, and below the 200-day MA of 1.49, indicating a bearish trend. The MACD of -0.08 indicates Positive momentum. The RSI at 35.38 is Neutral, neither overbought nor oversold. The STOCH value of 24.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:CL.

Cresco Labs Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	54 Neutral	$5.24B	3.27	-45.39%	2.80%	16.77%	-0.07%
CL	51 Neutral	$321.22M	―	-17.34%	―	-4.38%	46.68%
CRON		$734.45M	15.51	4.61%	―	―	―
CURLF		$652.44M	―	-25.08%	―	―	―
GTBIF		$1.21B	24.68	2.83%	―	―	―
TCNNF		$753.34M	―	-12.39%	―	―	―
VRNOF		$1.58B	―	-31.94%	―	―	―

Cresco Labs Corporate Events

Cresco Labs Reports Strong Q1 2025 Financial Results and Strategic Growth Plans

Cresco Labs reported strong financial results for the first quarter of 2025, with a revenue of $166 million and an operating cash flow of $30 million. The company emphasized its strategic approach to reducing credit risk and maintaining financial flexibility, ending the quarter with a cash balance of $162 million, the highest in three years. Cresco Labs aims to drive margin expansion and sustainable growth by deploying capital thoughtfully, positioning itself to gain market share and enhance value for stakeholders.

The most recent analyst rating on (TSE:CL) stock is a Buy with a C$4.00 price target. To see the full list of analyst forecasts on Cresco Labs stock, see the TSE:CL Stock Forecast page.

Cresco Labs Updates Q1 2025 Earnings Release Date

Cresco Labs has announced the updated date for its first quarter 2025 earnings release, scheduled for May 30, 2025. The company has completed its financial review with no material changes and plans to discuss the results in a conference call on June 2, 2025. This announcement reflects Cresco Labs’ commitment to transparency and its strategic positioning in the cannabis market, potentially impacting stakeholders positively by reinforcing trust in its financial practices.

The most recent analyst rating on (TSE:CL) stock is a Buy with a C$4.00 price target. To see the full list of analyst forecasts on Cresco Labs stock, see the TSE:CL Stock Forecast page.

Cresco Labs Expands in Pennsylvania with New Sunnyside Dispensary

Cresco Labs has announced the opening of a new Sunnyside dispensary in Chippewa Township, Beaver Falls, Pennsylvania, reinforcing its strong market presence in the state. This expansion highlights Cresco Labs’ strategic focus on deepening its core market presence, particularly in Pennsylvania where it holds a leading position in branded market share. The new location aims to enhance patient service with high-quality products and a superior retail experience, potentially increasing operating leverage and strengthening its industry positioning.

The most recent analyst rating on (TSE:CL) stock is a Buy with a C$4.00 price target. To see the full list of analyst forecasts on Cresco Labs stock, see the TSE:CL Stock Forecast page.

Cresco Labs Postpones Q1 2025 Earnings Release

Cresco Labs announced the postponement of its first quarter 2025 earnings release and conference call to allow more time for reviewing its interim financial statements. The rescheduling is expected to have implications for stakeholders as the company aims to maintain transparency and compliance with filing requirements, potentially impacting investor confidence and market perception.

Cresco Labs Postpones Q1 2025 Earnings Release

Cresco Labs has announced the postponement of its first quarter 2025 earnings release and conference call, originally scheduled for May 9, 2025, to allow more time for reviewing its interim financial statements. The company expects to reschedule the call and file the statements by May 30, 2025. This delay may impact stakeholders’ expectations and the company’s operational transparency, but Cresco remains committed to maintaining its industry leadership and stakeholder trust.

Cresco Labs Achieves Record Financial Performance in 2024

Cresco Labs reported record financial results for 2024, with an operating cash flow of $132 million, marking a 126% increase from the previous year. The company achieved a revenue of $724 million and maintained its leading market share in Illinois, Pennsylvania, and Massachusetts. Despite a net loss of $60 million due to one-time charges, Cresco Labs improved its adjusted EBITDA by 15% year-over-year, reflecting its disciplined strategy and strong market positioning.

Cresco Labs Expands into Kentucky’s Medical Cannabis Market

Cresco Labs has announced a management services agreement to operate a Tier 3 Cultivation License in Kentucky, marking a significant expansion into the state’s newly launched medical cannabis market. This move positions Cresco Labs as a key player in Kentucky’s burgeoning cannabis industry, with the potential to influence market growth and capitalize on projected revenue increases, reinforcing its strategic expansion and investment in high-return growth opportunities.