22nd Century (XXII) AI Stock Analysis

• Market Cap: $2.02M
• Dividend Yield: N/A
• Average Volume (3M): 2.49M
• Price to Earnings (P/E): 6.0
• Beta (1Y): 2.53
• Revenue Growth: -34.81%
• EPS Growth: 99.30%
• Country: US
• Employees: 56
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Tobacco
• EPS (TTM): -15.90
• Shares Outstanding: 510,177
• 10 Day Avg. Volume: 328,967
• 30 Day Avg. Volume: 2,485,312
• PEG Ratio: 0.00
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: -1.49
• Enterprise Value/Revenue: -0.29
• Enterprise Value/Gross Profit: 0.85
• Enterprise Value/Ebitda: 0.26
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): -0.9
• Revenue Forecast (FY): $32.50M

• Rating: 44 Neutral
• Price Target: $6.50 ▲(755.26% Upside)
• Action: Reiterated Date: 02/04/26
• Date: Action: Reiterated 02/04/26

The score is primarily held down by weak financial performance (declining revenue, large losses, and negative cash flow) and a strongly bearish technical setup with the stock far below key moving averages. Earnings-call updates provide some offset via improved balance-sheet positioning and strategic progress in VLN expansion, but valuation signals are limited due to an uninformative P/E and no dividend data.

Positive Factors

Debt-free balance sheet

Becoming debt-free and adding cash (quarter-end $4.8M plus a $9.5M insurance settlement) materially improves financial flexibility. Lower leverage reduces interest burden and bankruptcy risk, enabling management to fund VLN expansion and product investment without incremental debt over the medium term.

VLN distribution and product acceptance

Rapid retail roll-out to ~1,500 stores and positive taste reviews signal improving product-market fit. Sustainable retail distribution, if maintained, supports recurring branded sales and scale advantages versus contract manufacturing, improving margin prospects as volumes and brand recognition grow.

Strategic shift to higher-margin branded products

Moving from low-margin CMO work to owned branded VLN and natural-style cigarettes targets structurally higher gross margins and better control of pricing and distribution. If execution sustains, this repositioning improves revenue mix, gross-margin potential and long-term EBITDA durability.

Negative Factors

Persistent unprofitability and revenue decline

Deep negative gross and net margins and TTM revenue declines indicate operation-level deficiencies that require sustained top-line growth and margin recovery. Structural losses constrain reinvestment, extend the timeline to breakeven, and mean execution risk is high absent sustained volume gains and mix improvement.

Negative operating cash flow

Ongoing negative operating cash flow limits the company's ability to self-fund growth and absorb shocks. The small positive free cash flow growth is from a negative base, so reliance on one-time items and external financing remains likely until consistent positive OCF is achieved.

Weak equity base and dilution risk

A low equity ratio and highly negative ROE (pack metrics) combined with a reverse split and amended preferred terms signal a weak capital base and high dilution risk. The company has active authorization to raise capital (up to $25M sales agreement), which may dilute shareholders and affect long-term per-share economics.

22nd Century Business Overview & Revenue Model

Company Description

22nd 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 Money

22nd Century generates revenue through multiple channels, including the sale of its proprietary reduced nicotine tobacco products, which are marketed as a healthier alternative to conventional cigarettes. The company also earns revenue from licensing agreements related to its genetic engineering technology, which allows other companies to produce modified plants. Additionally, 22nd Century has entered into strategic partnerships with major tobacco companies to develop and commercialize its products, further enhancing its revenue potential. The company may also benefit from grants and funding aimed at public health initiatives related to smoking cessation.

22nd Century Financial Statement Overview

Summary

Weak fundamentals driven by declining revenue (-10.66% TTM) and deeply negative profitability (gross margin -16.03%, net margin -41.95%). Cash flow remains negative, and shareholder returns are severely pressured (ROE -170.04%) despite improved leverage (debt-to-equity 0.43).

Income Statement

The income statement reveals significant challenges for 22nd Century. The company has experienced declining revenue, with a negative revenue growth rate of -10.66% in the TTM. Margins are deeply negative, with a gross profit margin of -16.03% and a net profit margin of -41.95%, indicating substantial losses. The EBIT and EBITDA margins are also negative, reflecting operational inefficiencies. Overall, the income statement suggests a struggling financial performance with no immediate signs of profitability.

Balance Sheet

The balance sheet shows a mixed picture. The debt-to-equity ratio has improved to 0.43 in the TTM from 2.15 in the previous year, indicating better leverage management. However, the return on equity is significantly negative at -170.04%, reflecting poor returns for shareholders. The equity ratio stands at 8.44%, suggesting a low proportion of equity financing. While debt levels are manageable, the negative equity and returns highlight financial instability.

Cash Flow

Cash flow analysis indicates ongoing cash flow challenges. The operating cash flow is negative, and the free cash flow growth rate is slightly positive at 6.68%, but this is from a negative base. The operating cash flow to net income ratio is negative, suggesting cash flow issues relative to net losses. The free cash flow to net income ratio is close to 1, indicating that free cash flow is largely in line with net losses. Overall, cash flow remains a concern with limited improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.36M	11.88M	32.20M	40.50M	30.95M	28.11M
Gross Profit	-3.56M	-2.40M	-8.70M	1.85M	1.49M	1.44M
EBITDA	-11.78M	-12.11M	-40.41M	-32.89M	-31.00M	-18.07M
Net Income	-6.80M	-15.16M	-140.78M	-59.80M	-32.61M	-19.71M
Balance Sheet
Total Assets	32.37M	21.67M	27.50M	114.65M	75.95M	51.69M
Cash, Cash Equivalents and Short-Term Investments	4.85M	4.42M	2.06M	20.40M	48.74M	22.34M
Total Debt	1.18M	8.62M	16.38M	4.65M	2.34M	786.00K
Total Liabilities	11.26M	17.66M	35.91M	18.68M	9.88M	7.58M
Stockholders Equity	21.10M	4.01M	-8.41M	95.97M	66.07M	44.11M
Cash Flow
Free Cash Flow	-14.98M	-14.51M	-60.60M	-56.14M	-23.91M	-16.14M
Operating Cash Flow	-14.87M	-14.35M	-54.99M	-51.71M	-22.84M	-15.62M
Investing Cash Flow	130.00K	-139.00K	16.82M	22.58M	-27.73M	16.47M
Financing Cash Flow	14.24M	16.85M	37.21M	30.82M	50.88M	-304.00K

22nd Century Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.76
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Positive
• STOCH: 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 0.76 is below the 20-day moving average (MA) of 5.30, below the 50-day MA of 9.21, and below the 200-day MA of 56.59, indicating a bearish trend. The MACD of -1.43 indicates Negative momentum. The RSI at 26.05 is Positive, neither overbought nor oversold. The STOCH value of 9.85 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for XXII.

22nd Century Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
TPB	59 Neutral	$1.77B	34.13	21.45%	0.28%	6.71%	8.16%
UVV	56 Neutral	$1.31B	9.94	5.81%	6.15%	3.01%	-7.14%
ISPR	46 Neutral	$108.85M	-6.07	-254.99%	―	-20.13%	-88.66%
XXII	44 Neutral	$2.02M	5.96	-133.50%	―	-34.81%	99.30%
GNLN	42 Neutral	$3.74M	―	-240.32%	―	-78.46%	83.71%
KAVL	40 Underperform	$316.05K	-0.38	-68.63%	―	-88.85%	68.28%

22nd Century Corporate Events

22nd Century Announces 1-for-15 Reverse Stock Split

On January 22, 2026, 22nd Century Group, Inc. filed a Certificate of Amendment in Nevada to implement a 1-for-15 reverse stock split of its issued and outstanding common shares, a corporate action aimed solely at restoring and maintaining compliance with Nasdaq Capital Market’s continued listing requirements. The reverse split will take effect at 12:01 a.m. Eastern Time on January 26, 2026, after which the company’s shares will begin trading on a split-adjusted basis under the existing ticker “XXII” but with a new CUSIP, reducing the outstanding common shares from about 7.65 million to roughly 510,000 while leaving the 500 million authorized share count, par value, and stockholders’ proportional ownership and voting power largely unchanged, aside from minor rounding effects and corresponding adjustments to outstanding options, warrants and preferred shares.

The most recent analyst rating on (XXII) stock is a Sell with a $0.76 price target. To see the full list of analyst forecasts on 22nd Century stock, see the XXII Stock Forecast page.

22nd Century Updates Agreements to Meet Nasdaq Rules

On December 17, 2205, 22nd Century Group, Inc. amended its agreements with holders of its Series A Convertible Preferred Stock to comply with Nasdaq Listing Rules and streamline securities offerings. The amendment includes changes to stockholder approval deadlines, adjustments to conversion pricing, and provisions enabling future stock split and securities issuance. These updates aim to enhance operational flexibility and investor protections, while positioning the company for regulatory compliance and improved market opportunities.

The most recent analyst rating on (XXII) stock is a Hold with a $1.00 price target. To see the full list of analyst forecasts on 22nd Century stock, see the XXII Stock Forecast page.

22nd Century Signs $25M Sales Agreement for Expansion

On November 4, 2025, 22nd Century Group, Inc. entered into a Sales Agreement with Needham & Company, LLC to issue and sell shares of common stock up to $25 million, intending to use the proceeds for corporate purposes including the expansion of its VLN® products. The company also reported its third quarter 2025 financial results, highlighting a significant balance sheet improvement with no outstanding debt and a $9.5 million insurance settlement. The company is expanding its market reach with VLN® products, increasing store counts, and securing new distribution agreements, positioning itself for future growth in the tobacco industry.

The most recent analyst rating on (XXII) stock is a Sell with a $1.50 price target. To see the full list of analyst forecasts on 22nd Century stock, see the XXII Stock Forecast page.