Cresco Labs (CL) AI Stock Analysis

• Market Cap: C$471.62M
• Dividend Yield: N/A
• Average Volume (3M): 216.00K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.12
• Revenue Growth: -6.48%
• EPS Growth: 22.63%
• Country: CA
• Employees: 2,900
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): -0.07
• Shares Outstanding: 340,486,820
• 10 Day Avg. Volume: 152,419
• 30 Day Avg. Volume: 216,005
• PEG Ratio: 0.07
• Price to Book (P/B): 0.66
• Price to Sales (P/S): 0.43
• P/FCF Ratio: 2.89
• 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: C$2.43
• Price Target Upside: 97.18% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): -0.21
• Revenue Forecast (FY): C$903.38M

• Rating: 44 Neutral
• Price Target: C$1.00 ▼(-18.70% Downside)

Cresco Labs' overall stock score is primarily impacted by its financial performance, which is challenged by declining revenues, high leverage, and persistent net losses. Technical analysis further indicates a bearish trend, while valuation metrics reflect ongoing financial struggles. Despite some positive strategic initiatives and market expansions noted in the earnings call, these are overshadowed by the company's financial and market challenges.

Positive Factors

Debt Refinancing Success

Debt refinancing enhances Cresco Labs' financial flexibility, allowing it to better manage its capital structure and invest in growth opportunities, which is crucial for long-term stability and expansion.

Strategic Market Expansion

Expanding in key markets like Ohio and entering new ones such as Kentucky and Germany positions Cresco Labs for sustained growth and market leadership, enhancing its competitive edge.

Wholesale Market Gains

Strong wholesale market gains indicate effective distribution and brand strength, supporting revenue stability and growth in core markets, which is vital for long-term success.

Negative Factors

Declining Revenue Trend

A declining revenue trend can undermine Cresco Labs' ability to sustain operations and invest in growth, posing a risk to its market position and financial health over time.

High Leverage

High leverage increases financial risk, limiting Cresco Labs' ability to weather economic downturns and potentially constraining future investment opportunities.

Price Compression Challenges

Price compression reduces profitability and could pressure Cresco Labs' margins, affecting its ability to maintain competitive pricing and invest in product development.

Cresco Labs Business Overview & Revenue Model

Company Description

Cresco Labs (CL) is a leading cannabis company based in the United States, focusing on the cultivation, manufacturing, and distribution of cannabis products. The company operates in multiple sectors of the cannabis industry, including medical and adult-use markets. Cresco Labs is known for its extensive portfolio of branded cannabis products, which includes flower, edibles, oils, and concentrates, and it emphasizes quality, consistency, and innovation in its offerings.

How the Company Makes Money

Cresco Labs generates revenue primarily through the sale of its cannabis products across various states where it operates. The company holds licenses for cultivation and retail operations, allowing it to produce its own products and sell them directly to consumers through its dispensaries. Key revenue streams include wholesale sales of cannabis flower and processed products to other dispensaries, retail sales from its own dispensaries, and partnerships with other cannabis brands for product distribution. Additionally, Cresco Labs benefits from strategic partnerships that enhance its market reach and expand its product offerings, contributing to its overall earnings.

Cresco Labs Financial Statement Overview

Summary

Cresco Labs faces significant financial challenges, with declining revenues and profitability issues. High leverage and negative returns on equity indicate financial risk, while cash flow metrics suggest difficulties in generating sufficient cash. The company needs to address operational inefficiencies and improve its financial stability to enhance its overall financial health.

Income Statement

Cresco Labs has experienced declining revenue growth, with a negative growth rate of -2.94% in the TTM. The gross profit margin remains relatively stable at 48.34%, but the net profit margin is negative at -11.86%, indicating ongoing profitability challenges. The EBIT and EBITDA margins have also decreased, reflecting operational inefficiencies.

Balance Sheet

The company's debt-to-equity ratio is high at 1.35, indicating significant leverage. Return on equity is negative, showing that the company is not generating profit from its equity base. The equity ratio is not provided, but the high debt levels suggest potential financial risk.

Cash Flow

Cresco Labs has a negative free cash flow growth rate of -14.13% in the TTM, indicating declining cash generation. The operating cash flow to net income ratio is positive at 1.40, suggesting some ability to cover net losses with operating cash. However, the free cash flow to net income ratio is below 1, highlighting cash flow challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	670.20M	724.34M	770.88M	842.68M	821.68M	476.25M
Gross Profit	325.27M	364.45M	362.37M	407.01M	406.35M	206.70M
EBITDA	112.42M	114.28M	-13.97M	-10.66M	-159.63M	5.23M
Net Income	-52.19M	-74.44M	-175.52M	-212.05M	-319.60M	-102.16M
Balance Sheet
Total Assets	1.28B	1.36B	1.36B	1.58B	1.78B	1.33B
Cash, Cash Equivalents and Short-Term Investments	45.41M	137.56M	103.43M	119.34M	223.54M	136.34M
Total Debt	580.76M	639.64M	682.76M	670.17M	624.74M	354.58M
Total Liabilities	940.17M	967.18M	930.40M	996.01M	982.73M	608.37M
Stockholders Equity	428.34M	474.85M	505.69M	627.04M	755.55M	574.45M
Cash Flow
Free Cash Flow	43.57M	108.99M	681.00K	-67.39M	-82.57M	-91.21M
Operating Cash Flow	74.94M	132.48M	58.56M	18.74M	14.49M	-10.83M
Investing Cash Flow	-30.48M	-25.23M	-44.59M	-36.58M	-163.93M	-44.11M
Financing Cash Flow	-122.33M	-71.48M	-26.91M	-86.64M	235.00M	142.67M

Cresco Labs Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.23
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CL, the sentiment is Positive. The current price of 1.23 is above the 20-day moving average (MA) of 1.14, below the 50-day MA of 1.48, and above the 200-day MA of 1.19, indicating a bullish trend. The MACD of -0.03 indicates Negative momentum. The RSI at 71.88 is Negative, neither overbought nor oversold. The STOCH value of 50.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CL.

Cresco Labs Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CRON	67 Neutral	C$1.49B	29.82	3.34%	―	22.20%	―
GTII	67 Neutral	$1.97B	34.13	2.42%	―	6.18%	-28.69%
CURA	55 Neutral	C$2.85B	―	-27.61%	―	-3.38%	-31.35%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
VRNO	49 Neutral	$2.17B	―	-33.01%	―	-4.58%	-141.91%
TRUL	46 Neutral	C$1.53B	―	-9.95%	―	4.27%	3.41%
CL	44 Neutral	C$471.62M	―	-11.79%	―	-6.48%	22.63%

Cresco Labs Corporate Events

Cresco Labs Enters EU Market with German Launch

Cresco Labs has announced its entry into the European Union market with the launch of its flagship flower brand in Germany. This strategic move marks the company’s first commercial venture in the EU, aiming to leverage Germany’s rapidly growing regulated cannabis market. By partnering with Blossom, an EU GMP-certified manufacturer in Portugal, Cresco Labs introduces three signature flower products available via prescription through licensed pharmacies in Germany. This expansion is part of Cresco’s broader growth strategy to explore international markets and gather insights for future growth decisions, potentially strengthening its industry positioning and offering new opportunities for stakeholders.

Cresco Labs Reports Strong Q3 Results and Strategic Growth Initiatives

Cresco Labs reported strong financial results for the third quarter of 2025, with a revenue of $165 million and an adjusted EBITDA of $40 million. The company successfully refinanced its debt, strengthening its balance sheet and extending debt maturity to 2030. Cresco Labs is expanding its operations with new dispensaries in Ohio, entering the Kentucky market, and planning a product launch in Germany, positioning itself for future growth and market leadership.

Cresco Labs to Announce Q3 2025 Financial Results

Cresco Labs announced it will release its third-quarter 2025 financial results on November 5, 2025. The company will host a conference call and webcast to discuss the results and provide business highlights, reflecting its ongoing efforts to strengthen its market position and engage with stakeholders.

Cresco Labs Announces Shareholder Meeting Results and Strategic Initiatives

Cresco Labs announced the results of its annual general and special meeting of shareholders, where seven directors were elected, and Baker Tilly US, LLP was appointed as the auditor for the upcoming year. Shareholders also approved the company’s Award Exchange Program, allowing employees to exchange underwater options for full value awards, aligning pay with performance. These decisions, approved by at least 96% of votes, aim to strengthen Cresco Labs’ operational and strategic positioning in the cannabis industry.

Cresco Labs Expands Ohio Presence with New Sunnyside Dispensary

Cresco Labs has opened its sixth dispensary in Ohio, named Sunnyside, located in Proctorville, marking its 71st location nationwide. This expansion strengthens Cresco Labs’ market leadership in Ohio, where it holds the top retail market share and third in branded product share. The new dispensary is expected to contribute to local economic growth through job creation and increased revenue, which will be used to improve community infrastructure.