tiprankstipranks
Trending News
More News >
Verano Holdings (TSE:VRNO)
NEO-L:VRNO

Verano Holdings (VRNO) AI Stock Analysis

Compare
48 Followers

Top Page

TS

Verano Holdings

(NEO-L:VRNO)

49Neutral
Verano Holdings' overall stock score reflects significant financial challenges with declining revenues and net losses. While there is positive momentum from retail expansion and new product launches, these are counterbalanced by ongoing profitability issues. Technical indicators and valuation metrics suggest caution.
Positive Factors
Earnings
Verano reported strong Q2 results, with profitability margins and adjusted EBITDA contribution both exceeding expectations, demonstrating strong operational execution.
Growth Potential
Verano launched adult-use sales in Ohio on the first day of market launch, positioning it as a key growth lever with significant sales potential.
Market Expansion
The acquisition of CBST's assets in Arizona and Virginia will expand Verano's operations and penetrate the Virginia medical market for the first time.
Negative Factors
Revenue Challenges
Solid growth in wholesale revenue offset by a decline in retail revenue, primarily driven by the expected productivity decline in NJ.

Verano Holdings (VRNO) vs. S&P 500 (SPY)

Verano Holdings Business Overview & Revenue Model

Company DescriptionVerano Holdings (VRNO) is a leading vertically integrated multi-state cannabis operator in the United States. The company is primarily engaged in the cultivation, processing, and retailing of cannabis products. Verano operates a wide range of dispensaries under various brand names and offers a diverse portfolio of products, including premium flower, concentrates, edibles, and infused products. Its operations span across several states, where it leverages its extensive distribution network to meet the growing demand for cannabis products.
How the Company Makes MoneyVerano Holdings generates revenue through multiple streams, primarily from the sale of cannabis products across its retail dispensaries and wholesale distribution channels. The company cultivates and processes cannabis in its state-of-the-art facilities, ensuring a consistent supply of high-quality products. Retail sales contribute significantly to Verano's revenue, as the company operates numerous dispensaries in key markets. Additionally, it engages in wholesale transactions, supplying cannabis products to other dispensaries and third-party retailers. Verano's strategic partnerships and acquisitions often enhance its market presence and expand its product offerings, further bolstering its revenue generation capabilities. The company also benefits from its strong brand portfolio, which attracts a loyal customer base and drives sales growth.

Verano Holdings Financial Statement Overview

Summary
Verano Holdings faces significant financial challenges, with declining revenues and profitability. Operational cash flows remain positive, but the company struggles with consistent revenue growth and net losses. The balance sheet shows moderate leverage but decreasing financial stability.
Income Statement
35
Negative
Verano Holdings has faced significant challenges in profitability, with declining gross profit and net profit margins. The company reported negative net income in the latest period, indicating operational difficulties. Revenue growth has been inconsistent, with a notable decline from 2022 to 2024. EBIT and EBITDA margins have also deteriorated, suggesting pressure on operational efficiency.
Balance Sheet
45
Neutral
The balance sheet shows a moderate debt-to-equity ratio, indicating manageable leverage levels. However, the equity ratio has declined, reflecting reduced financial stability. Return on equity remains negative due to ongoing net losses. The company's total assets have also decreased, which could limit future growth potential.
Cash Flow
50
Neutral
Cash flow from operations remains positive, which is a positive indicator amidst the company's struggles. Free cash flow growth is modest but positive, reflecting some capacity to generate cash after capital expenditures. The operating cash flow to net income ratio is strong, suggesting efficient cash conversion from operations despite net losses.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
878.59M938.45M1.14B925.07M306.53M
Gross Profit
443.93M475.21M534.79M405.23M157.02M
EBIT
-237.18M84.78M86.56M75.34M123.81M
EBITDA
-94.29M239.22M47.32M212.51M134.36M
Net Income Common Stockholders
-341.86M-117.35M-350.41M-72.10M51.51M
Balance SheetCash, Cash Equivalents and Short-Term Investments
87.80M230.44M114.97M125.20M20.90M
Total Assets
1.99B3.08B3.26B3.22B419.98M
Total Debt
522.98M542.79M675.78M446.27M67.17M
Net Debt
435.19M368.03M560.81M321.07M46.27M
Total Liabilities
1.04B1.45B1.45B1.35B224.55M
Stockholders Equity
952.17M1.64B1.82B1.87B187.48M
Cash FlowFree Cash Flow
13.15M99.04M-32.32M54.55M10.79M
Operating Cash Flow
112.19M148.07M122.83M242.15M100.88M
Investing Cash Flow
-133.25M-63.98M-270.59M-582.27M-119.07M
Financing Cash Flow
-65.93M27.60M129.20M443.82M33.89M

Verano Holdings Technical Analysis

Technical Analysis Sentiment
Negative
Last Price6.32
Price Trends
50DMA
6.32
Positive
100DMA
6.32
Negative
200DMA
6.32
Negative
Market Momentum
MACD
<0.01
Neutral
RSI
100.00
Negative
STOCH
81.97
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:VRNO, the sentiment is Negative. The current price of 6.32 is above the 20-day moving average (MA) of 6.32, above the 50-day MA of 6.32, and below the 200-day MA of 6.32, indicating a neutral trend. The MACD of <0.01 indicates Neutral momentum. The RSI at 100.00 is Negative, neither overbought nor oversold. The STOCH value of 81.97 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:VRNO.

Verano Holdings Peers Comparison

Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
71
Outperform
$2.08B21.174.19%9.46%105.27%
67
Neutral
$998.24M17.453.80%35.87%
56
Neutral
C$1.22B-12.12%6.27%67.62%
56
Neutral
$1.13B-23.33%0.67%19.14%
52
Neutral
$5.28B3.75-42.72%2.86%17.70%2.03%
49
Neutral
$2.17B-31.19%-4.99%-200.83%
47
Neutral
$351.32M-84.50%-16.27%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:VRNO
Verano Holdings
6.32
0.00
0.00%
TSE:WEED
Canopy Growth
1.94
-12.25
-86.33%
TSE:CRON
Cronos Group
2.57
-1.09
-29.78%
TSE:GTII
Green Thumb Industries
8.80
-9.47
-51.83%
TSE:TRUL
Trulieve Cannabis
6.40
-10.30
-61.68%
TSE:CURA
Curaleaf Holdings
1.34
-6.39
-82.66%

Verano Holdings Earnings Call Summary

Earnings Call Date:Feb 27, 2025
(Q4-2024)
|
% Change Since: 0.00%|
Next Earnings Date:May 08, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook for Verano Holdings. While the company showcased strong wholesale performance, retail expansion, and successful new product launches, it also faced significant challenges such as a net loss due to asset impairments, revenue decline in key markets, and pricing pressures. Overall, the highlights and lowlights are balanced, reflecting a neutral sentiment.
Q4-2024 Updates
Positive Updates
Strong Full Year Revenue and Wholesale Performance
For the full year 2024, Verano Holdings delivered $879 million in revenue and adjusted EBITDA of $264 million. The company achieved $353 million in total wholesale revenue, marking the highest annual total ever in the wholesale segment, with a 1% gain versus the prior year.
Expansion of Retail Footprint
In 2024, Verano strengthened its retail footprint by adding 17 new dispensaries across key markets including Virginia, Arizona, Pennsylvania, New Jersey, Connecticut, and Florida.
Innovative Product Launches
The company launched innovative products such as Extra Savvy 2 gram vape cartridges and Essence J’s barrel-style pre-roll joints, which have become top-selling items in their respective markets.
Improved Retail Productivity
In the fourth quarter, Verano increased transactions per headcount by 54% in Florida and 14% in other markets compared to the third quarter.
Positive Performance in Florida
Verano reclaimed the number two market position in Florida with an 11% market share, driven by successful facility upgrades and new product launches.
Negative Updates
Net Loss and Impairments
Verano reported a net loss of $342 million for the year, driven by intangible and fixed asset impairments, particularly in Pennsylvania retail licenses and an Arizona cultivation facility.
Revenue Decline in Key Markets
Revenue decreased by 6% year-over-year, primarily due to increased competition, promotional activity, and cultivation facility upgrades in markets like New Jersey, Illinois, and Florida.
Pricing Compression and Competition
The company faced pricing compression and increased competition in markets such as Illinois, New Jersey, and Florida, impacting retail revenue.
Increased SG&A Expenses
SG&A expenses increased to $353 million in 2024, representing 40% of revenue, up from 35% of revenue in the prior year, driven by new store openings.
Challenges with Third-Party Accounts
Verano held back some third-party accounts due to non-payment, affecting wholesale performance, though improvements are underway.
Company Guidance
During the Verano Holdings earnings call for the fourth quarter and full year 2024, several key metrics were highlighted regarding the company's financial performance and future guidance. Verano reported a full-year revenue of $879 million and an adjusted EBITDA of $264 million, which represents 30% of their revenue. The fourth-quarter revenue was $218 million, showing a sequential increase of 1% from the previous quarter, with an adjusted EBITDA of $63 million. Retail revenue for the year totaled $672 million, while wholesale revenue reached $353 million, marking a 1% gain over the prior year. The company expanded its retail footprint by adding 17 new dispensaries across key markets such as Virginia and Arizona. Verano also experienced a net loss of $342 million for the year, largely due to impairments of intangible and fixed assets, and ended the year with $88 million in cash and cash equivalents. Looking ahead to 2025, Verano anticipates CapEx spending between $25 million and $40 million, focusing on efficiency initiatives at cultivation facilities and targeted retail expansion, while also exploring potential M&A opportunities to strengthen their market position.

Verano Holdings Corporate Events

Product-Related AnnouncementsBusiness Operations and Strategy
Verano Expands Florida Presence with New MÜV Dispensary
Positive
Apr 17, 2025

Verano Holdings Corp. has expanded its retail presence in Florida with the opening of the MÜV New Smyrna Beach dispensary, marking its 81st location in the state and 155th nationwide. This new opening, strategically located near local amenities, aims to enhance customer experience and capitalize on the 420 ‘high holiday’ with significant promotions. The expansion underscores Verano’s commitment to growing its footprint in Florida, with plans for further product launches and dispensary openings throughout 2025, thereby strengthening its market position and offering a comprehensive cannabis shopping experience.

Spark’s Take on TSE:VRNO Stock

According to Spark, TipRanks’ AI Analyst, TSE:VRNO is a Neutral.

Verano Holdings’ overall stock score reflects significant financial challenges, with declining revenues and net losses weighing heavily. The company’s strategic expansions and retail growth offer some positive outlook, but are counterbalanced by persistent profitability issues. Technical indicators suggest a neutral to cautious outlook, while valuation metrics indicate potential overvaluation due to ongoing losses.

To see Spark’s full report on TSE:VRNO stock, click here.

Financial Disclosures
Verano Holdings to Announce Q1 2025 Financial Results
Neutral
Apr 4, 2025

Verano Holdings announced it will release its first quarter 2025 financial results on May 8, 2025, before the market opens. The company will host a conference call and webcast to discuss these results, providing an opportunity for analysts and investors to engage with the company’s leadership. This announcement is significant as it provides stakeholders with insights into the company’s financial health and operational performance, potentially influencing market perceptions and investment decisions.

Product-Related AnnouncementsBusiness Operations and Strategy
Verano Holdings Expands in Connecticut with New Zen Leaf Ashford Dispensary
Positive
Apr 1, 2025

Verano Holdings has expanded its presence in Connecticut with the opening of Zen Leaf Ashford, its sixth retail location in the state and the closest cannabis dispensary to the University of Connecticut. This new outlet offers a unique 20% discount for UConn students and celebrates university sports victories with special deals. The opening is part of Verano’s broader strategy to enhance its market position and community engagement, including support for local organizations. The Ashford location complements existing Connecticut dispensaries and is supported by Verano’s cultivation facility in Rocky Hill, which produces a variety of cannabis products.

Product-Related AnnouncementsBusiness Operations and Strategy
Verano Expands Savvy and Essence Cannabis Product Lines
Positive
Mar 13, 2025

Verano Holdings has announced the expansion of its Savvy and Essence product lines, introducing new cannabis products such as Extra Savvy 2-gram vape cartridges and Savvy Strut 2-gram all-in-one vapes. These products target the rapidly growing vape and pre-roll categories, leveraging advanced manufacturing technology to enhance production efficiency and meet consumer demand. The launch positions Verano to strengthen its market presence in key states, with products available in Illinois, New Jersey, Maryland, and Arizona, and plans to expand to additional states.

Business Operations and StrategyFinancial Disclosures
Verano Holdings Reports 2024 Financial Results Amid Strategic Expansion
Negative
Feb 27, 2025

Verano Holdings Corp. reported its financial results for the fourth quarter and full year of 2024, highlighting a decrease in revenue and a significant net loss compared to the previous year. Despite these challenges, the company made strategic moves by entering the Virginia market, expanding in Arizona, and launching new dispensaries and products, which are expected to support long-term growth.

Business Operations and Strategy
Verano Expands Florida Presence with 80th MÜV Dispensary
Positive
Feb 19, 2025

Verano Holdings announced the opening of its 80th MÜV dispensary in Florida, located in North Miami Beach, enhancing their presence in Miami-Dade County. This expansion strengthens Verano’s retail footprint in a populous region, providing convenient access to cannabis products for a large customer base and demonstrating the company’s commitment to growth in the competitive cannabis market.

Financial Disclosures
Verano Holdings to Announce 2024 Financial Results
Neutral
Feb 10, 2025

Verano Holdings has announced that it will report its financial results for the fourth quarter and full year of 2024 on February 27, 2025. The company will host a conference call and webcast to discuss these results, indicating a continued focus on transparency and engagement with investors and stakeholders.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.