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Cresco Labs
(OTC:CL)
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Rating:50Neutral
Price Target:
C$1.00
▲(4.17% Upside)
Action:Reiterated
Date:08/10/26
The score is held back primarily by weak financial quality (net losses, elevated leverage, and volatile free cash flow). Earnings-call guidance and operational progress (solid EBITDA margins and a ~10% sequential revenue growth outlook) provide support, but technicals remain soft and valuation signals are limited due to negative earnings and no dividend.
Positive Factors
Vertical integration and multi-state footprint
Owning cultivation, manufacturing and retail across multiple states creates durable control of supply, margin capture and brand placement. This vertical model reduces reliance on third-party suppliers, supports margin preservation amid pricing pressure, and enables scale in regulated state markets.
Negative Factors
Elevated leverage and negative ROE
A debt-to-equity ratio near 1.65 with materially negative ROE indicates capital is not generating sufficient returns. Elevated leverage reduces financial flexibility for capex or deals, increases refinancing and interest risk, and constrains ability to absorb market shocks across the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Vertical integration and multi-state footprint
Owning cultivation, manufacturing and retail across multiple states creates durable control of supply, margin capture and brand placement. This vertical model reduces reliance on third-party suppliers, supports margin preservation amid pricing pressure, and enables scale in regulated state markets.
Read all positive factors
Cresco Labs (CL) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$502.31M
Dividend YieldN/A
Average Volume (3M)75.25K
Price to Earnings (P/E)―
Beta (1Y)2.21
Revenue Growth-5.83%
EPS Growth-115.39%
CountryCA
Employees2,900
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)-0.29
Shares Outstanding355,588,680
10 Day Avg. Volume78,707
30 Day Avg. Volume75,253
Financial Highlights & Ratios
PEG Ratio-0.03
Price to Book (P/B)1.22
Price to Sales (P/S)0.62
P/FCF Ratio10.78
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$2.53Price Target Upside163.56% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
EPS Forecast (FY)-0.03
Revenue Forecast (FY)C$668.30M
Cresco Labs Business Overview & Revenue Model
Company Description
Cresco Labs Inc. engages in cultivating medical grade cannabis, manufacturing medical products derived from cannabis cultivation, and distributing such products to medical or adult use consumers. It focuses on regulatory compliance while working t...
How the Company Makes Money
Cresco Labs primarily makes money by selling cannabis and cannabis-derived products through two main channels: (1) wholesale distribution and (2) company-operated retail dispensaries. Wholesale revenue is generated when Cresco sells its branded pr...
Cresco Labs Earnings Call Summary
Earnings Call Date:May 08, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call presents a cautiously optimistic outlook: management delivered solid Q1 margins and EBITDA from a streamlined cost structure, achieved meaningful operational and licensing wins (PA store expansion, Ohio openings, Kentucky harvest, Texas license) and provided constructive Q2 growth guidance (~+10% revenue). Offsets include near-term revenue headwinds from the planned California exit and Michigan excise tax, ongoing pricing compression, seasonal cash flow timing, and unresolved regulatory details around rescheduling (including the scope and timing of 280E relief). On balance, operational momentum, accretive M&A activity, and licensing progress outweigh the short-term market and regulatory challenges.Positive Updates
Quarterly Revenue and Profitability
Q1 2026 revenue of $151.0 million, adjusted gross profit of $77.0 million, adjusted gross margin of 51%, and adjusted EBITDA of $33.0 million (22% of revenue).
Negative Updates
Near-Term Revenue Headwinds from Market Exits and Taxes
Q1 baseline affected by planned exit from California and disruption in Michigan following the introduction of an excise tax; normalized sequential performance showed wholesale revenue down 1.6% and retail revenue down 3.1% quarter-over-quarter.
Read all updates
Q1-2026 Updates
Positive
Negative
Quarterly Revenue and Profitability
Q1 2026 revenue of $151.0 million, adjusted gross profit of $77.0 million, adjusted gross margin of 51%, and adjusted EBITDA of $33.0 million (22% of revenue).
Read all positive updates
Company Guidance
Cresco set Q1 2026 as a baseline and provided specific metrics: Q1 revenue was $151M with $77M adjusted gross profit (51% adjusted gross margin), $33M adjusted EBITDA (22% margin) and adjusted SG&A of $51M (34% of revenue); the company ended the quarter with $67M in cash and restricted cash, used $6M in operating cash flow and invested $11M in capex and acquisitions (mostly Kentucky Phase 1). Normalizing for planned exit from California and Michigan disruption, wholesale was down 1.6% and retail down 3.1% sequentially; Sunnyside stores generate over 30% more revenue per store than state averages, roughly 50% of revenue is medical, and Michigan represents <3% of total. For Q2 they expect revenue to rise ~10% sequentially, gross margins of 48–50% and adjusted EBITDA margins near 21%; operational progress includes 11 dispensaries added year-to-date (bringing Pennsylvania to 27 stores via a 9-store MSA and Ohio to 8 stores after 2 openings), Kentucky’s first harvest in April with branded product arriving in Q2, and receipt of 1 of 15 Texas merit-based licenses.Cresco Labs Financial Statement Overview
Summary
Income Statement
46
Neutral
Balance Sheet
41
Neutral
Cash Flow
44
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 648.65M | 667.33M | 724.34M | 770.88M | 842.68M | 821.68M |
| Gross Profit | 308.40M | 324.57M | 364.45M | 362.37M | 407.01M | 406.35M |
| EBITDA | 113.75M | 20.34M | 114.28M | -13.97M | -10.66M | -159.63M |
| Net Income | -100.70M | -137.78M | -74.44M | -175.52M | -212.05M | -319.60M |
Balance Sheet | ||||||
| Total Assets | 1.26B | 1.20B | 1.36B | 1.36B | 1.58B | 1.78B |
| Cash, Cash Equivalents and Short-Term Investments | 32.87M | 90.92M | 137.56M | 103.43M | 119.34M | 223.54M |
| Total Debt | 592.02M | 583.10M | 639.64M | 682.76M | 670.17M | 624.74M |
| Total Liabilities | 999.97M | 943.08M | 967.18M | 930.40M | 996.01M | 982.73M |
| Stockholders Equity | 358.69M | 339.83M | 474.85M | 505.69M | 627.04M | 755.55M |
Cash Flow | ||||||
| Free Cash Flow | 8.73M | 38.41M | 108.99M | 681.00K | -67.39M | -82.57M |
| Operating Cash Flow | 43.93M | 74.17M | 132.48M | 58.56M | 18.74M | 14.49M |
| Investing Cash Flow | -43.03M | -41.42M | -25.23M | -44.59M | -36.58M | -163.93M |
| Financing Cash Flow | -85.81M | -83.52M | -71.48M | -26.91M | -86.64M | 235.00M |
Cresco Labs Technical Analysis
Neutral
0.96
Price Trends
1.09
Positive
1.20
Negative
1.33
Negative
Market Momentum
>-0.01
Negative
56.11
Neutral
88.92
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CL, the sentiment is Neutral. The current price of 0.96 is below the 20-day moving average (MA) of 0.99, below the 50-day MA of 1.09, and below the 200-day MA of 1.33, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 56.11 is Neutral, neither overbought nor oversold. The STOCH value of 88.92 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:CL.
Cresco Labs Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | C$2.25B | 13.27 | 6.82% | ― | 3.81% | 344.13% | |
57 Neutral | C$3.57B | -69.02 | -4.47% | ― | 1.50% | 81.84% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | C$2.17B | -1.68 | -33.99% | ― | -2.30% | 26.63% | |
50 Neutral | C$502.31M | -2.61 | -28.27% | ― | -5.83% | -115.39% | |
40 Neutral | C$18.10M | -0.03 | -74.75% | ― | ― | ― |
* Healthcare Sector Average
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Cresco Labs Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Cresco Labs Posts Strong Q2 Growth and Reshapes Finance Leadership
Positive
Aug 6, 2026
Cresco Labs reported second-quarter 2026 revenue of $173 million, with gross profit of $87 million and adjusted gross margin of 51.6 percent, while generating $40 million in adjusted EBITDA and a 22.8 percent margin. Management highlighted 15 perc...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.