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22nd Century (XXII)
NASDAQ:XXII
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22nd Century
(NASDAQ:XXII)
37Underperform
22nd Century (XXII) vs. S&P 500 (SPY)
Market Cap
$1.84M
Dividend YieldN/A
Average Volume (3M)1.08M
Price to Earnings (P/E)―
Beta (1Y)1.95
Revenue Growth-65.44%
EPS Growth96.80%
CountryUS
Employees56
SectorConsumer Defensive
Sector Strength96
IndustryTobacco
Share Statistics
EPS (TTM)-518.20
Shares Outstanding2,369,552
10 Day Avg. Volume3,130,928
30 Day Avg. Volume1,081,732
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.02
Price to Cash Flow (P/CF)-0.10
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
22nd Century Business Overview & Revenue Model
Company Description22nd Century Group, Inc., an agricultural biotechnology company, focuses on tobacco harm reduction, reduced nicotine tobacco, and enhancing health and wellness through plant science for the life science and consumer products industries. It develops very low nicotine content tobacco and cigarette products under the VLN King and VLN Menthol King names; and SPECTRUM research cigarettes for use in independent clinical studies. The company has collaboration with Keygene N.V. to develop hemp/cannabis plants for exceptional cannabinoid profiles and other superior agronomic traits for medical, therapeutic, and agricultural uses, as well as other applications. 22nd Century Group, Inc. was founded in 1998 and is headquartered in Buffalo, New York.
How the Company Makes Money22nd Century Group makes money primarily through the sale of its proprietary reduced nicotine content tobacco products, which are designed to address regulatory demands for lower nicotine levels in cigarettes. The company generates revenue from its partnerships with tobacco companies, providing them with reduced nicotine tobacco leaf and licensing its technology. Additionally, 22nd Century is involved in the hemp/cannabis sector, where it earns revenue from the sale of hemp-derived CBD products and through partnerships aimed at exploiting their proprietary plant genetics for cannabinoid production. The company's revenue model is also supported by its ongoing R&D efforts and patent portfolio, which provide opportunities for licensing and joint ventures.
22nd Century Financial Statement Overview
Summary
22nd Century faces significant financial challenges, with declining revenues, persistent losses, and high leverage. The company struggles with profitability and liquidity, relying heavily on financing. These issues pose substantial risks to financial health and sustainability.Income Statement
The company has seen declining revenues over recent years, with a significant drop from $62.1M in 2022 to $24.4M in 2024. Gross profit margin is negative, indicating costs exceed revenues. Net profit margin is also negative due to consistent losses, including a net income of -$15.2M in 2024. These factors reflect poor performance and profitability concerns.20
Very Negative
Balance Sheet
The debt-to-equity ratio is unfavorable, reflecting high leverage with total debt of $8.6M compared to equity of $4.0M in 2024. The equity ratio is low, indicating limited shareholder equity relative to assets. Return on equity is negative, highlighting losses. Despite some asset retention, overall financial stability is weak.30
Negative
Cash Flow
Operating cash flow remains negative at -$14.3M in 2024, showing cash outflows from operations. The free cash flow is similarly negative, indicating financial struggles. High financing cash flow suggests reliance on external financing, while negative free cash flow growth shows no improvement in liquidity.25
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 11.88M | 32.20M | 62.11M | 30.95M | 28.11M | Gross Profit |
| -2.40M | -8.70M | 1.17M | 2.07M | 1.44M | EBIT |
| -13.95M | -44.93M | -57.11M | -28.33M | -19.01M | EBITDA |
| -12.11M | -40.41M | -32.89M | -31.00M | -18.07M | Net Income Common Stockholders |
| -15.16M | -140.78M | -59.80M | -32.61M | -19.71M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 4.42M | 2.06M | 21.21M | 48.74M | 22.34M | Total Assets |
| 21.67M | 27.50M | 114.65M | 75.95M | 51.69M | Total Debt |
| 8.62M | 16.38M | 6.73M | 2.34M | 786.00K | Net Debt |
| 4.20M | 14.32M | 3.71M | 1.00M | -243.00K | Total Liabilities |
| 17.66M | 35.91M | 18.68M | 9.88M | 7.58M | Stockholders Equity |
| 4.01M | -8.41M | 95.97M | 66.07M | 44.11M |
| Cash Flow | Free Cash Flow | |||
| -14.35M | -60.60M | -56.14M | -23.91M | -16.14M | Operating Cash Flow |
| -14.35M | -54.99M | -51.71M | -22.84M | -15.62M | Investing Cash Flow |
| -139.00K | 16.82M | 22.58M | -27.73M | 16.47M | Financing Cash Flow |
| 16.85M | 37.21M | 30.82M | 50.88M | -304.00K |
22nd Century Technical Analysis
Negative
0.78
Price Trends
1.96
Negative
4.67
Negative
28.35
Negative
Market Momentum
-0.38
Negative
22.49
Positive
3.47
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XXII, the sentiment is Negative. The current price of 0.78 is below the 20-day moving average (MA) of 1.22, below the 50-day MA of 1.96, and below the 200-day MA of 28.35, indicating a bearish trend. The MACD of -0.38 indicates Negative momentum. The RSI at 22.49 is Positive, neither overbought nor oversold. The STOCH value of 3.47 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for XXII.
22nd Century Risk Analysis
22nd Century disclosed 39 risk factors in its most recent earnings report. 22nd Century reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
22nd Century Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $32.39B | 10.32 | 45.38% | 4.80% | 5.61% | 23.39% | |
72 Outperform | $98.08B | 8.89 | -503.31% | 6.95% | -0.28% | 43.51% | |
67 Neutral | $239.53B | 34.04 | -37142.11% | 3.28% | 7.75% | -9.85% | |
63 Neutral | $9.29B | 14.70 | 4.05% | 187.74% | 3.97% | 6.53% | |
61 Neutral | $92.08B | 24.26 | 5.87% | 6.94% | -2.51% | ― | |
58 Neutral | $1.03B | 27.02 | 27.80% | 0.49% | -0.13% | 2.92% | |
37 Underperform | $1.84M | ― | -385.90% | ― | -65.44% | 96.80% |
* Consumer Defensive Sector Average
Performance Comparison
XXII
22nd Century
0.78
-221.97
-99.65%
MO
Altria Group
58.16
18.79
47.73%
BTI
British American Tobacco
42.37
15.26
56.29%
PM
Philip Morris
163.21
73.19
81.30%
IMBBY
Imperial Brands
39.32
18.22
86.35%
TPB
Turning Point Brands
57.79
30.45
111.38%
22nd Century Earnings Call Summary
Earnings Call Date: Mar 20, 2025 | % Change Since: -58.95% | Next Earnings Date: May 7, 2025
Earnings Call Sentiment Neutral
The call highlighted significant progress in restructuring and positioning the company for future growth, particularly with the relaunch of VLN and improvements in the balance sheet. However, ongoing challenges with cash burn, revenue decline, and share price instability persist, requiring further efforts to achieve profitability and stabilize the company's financial standing.Highlights
Successful Restructuring and Turnaround
The company completed a significant restructuring, reducing operating cash burn, restructuring the Board, eliminating cash bonuses and stock-based compensation, and reducing R&D and G&A expenses. This resulted in a dramatic reduction in liabilities by $18 million or nearly 50%.
Launch of VLN Product
The company is relaunching its VLN product, the first and only FDA authorized modified risk tobacco product, with redesigned packaging, new marketing strategies, and expanded state regulatory approvals.
Improved Balance Sheet and Debt Reduction
The balance sheet improved significantly with a reduction in liabilities by over $18 million and a further reduction in outstanding debt by $3.1 million in Q1 2025.
Positive Outlook for CMO Business
The CMO business showed promise with the signing of new contracts, including a long-term commitment from Smoker Friendly, and the introduction of Smoker Friendly Black, expected to be a growth engine in 2025.
Progress Towards Profitability
The company aims to achieve profitability in the P&L for the first time in its history in 2025 by expanding VLN distribution and achieving revenue growth and margin improvement.
Lowlights
Continued Cash Burn and Losses
The company continues to experience cash burn and operating losses, with a net loss and negative EBITDA trends persisting in Q4 2024.
Temporary Revenue Decline
Net revenue decreased to $4 million in Q4 2024 from $5.9 million in Q3 2024, with a gross margin loss of $1.2 million compared to a $588,000 loss in the prior period.
Unstable Share Price
The company's share price and market capitalization remain unstable and not reflective of the company's perceived value.
Dependency on Future Financing
Outside investment support is still necessary due to the lack of free cash flow from operations.
Challenges in Maintaining NASDAQ Listing
The company had to implement two reverse stock splits in 2024 to maintain its NASDAQ listing.
Company Guidance
During the 22nd Century Group's fourth-quarter and full-year 2024 conference call, significant guidance was provided concerning their strategic direction and financial performance. Key metrics highlighted include the reduction of total liabilities by approximately $18 million, alongside a notable decrease in the cash burn rate. The company achieved net revenue of $4 million in Q4 2024, with a gross margin loss of $1.2 million, reflecting a temporary decline in volume to 338,000 cartons due to repricing CMO contracts. The company has also successfully raised nearly $17 million through equity cash infusions and debt conversions to support the turnaround. Looking ahead, 22nd Century aims for profitability in 2025, with a focus on expanding VLN product distribution and improving the CMO business's gross margins. The balance sheet has been strengthened, with a positive net working capital of $1.6 million by year-end. They also expect EBITDA breakeven by Q4 2025, driven by restored CMO volumes and the launch of rebranded VLN products in Q2 2025.22nd Century Corporate Events
Product-Related AnnouncementsBusiness Operations and Strategy
22nd Century Expands Market Reach with New Agreement
Positive
Jan 7, 2025
22nd Century Group, Inc. entered a five-year exclusive licensing and manufacturing agreement with Smoker Friendly International, LLC, covering 11 existing and eight new cigarette brands. This agreement strengthens their decade-long partnership and expands their market reach with premium and reduced nicotine content products, enhancing both companies’ growth opportunities and product offerings in the tobacco industry.
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.