22nd Century (XXII) AI Stock Analysis

• Market Cap: $6.82M
• Dividend Yield: N/A
• Average Volume (3M): 1.89M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.94
• Revenue Growth: -49.46%
• EPS Growth: 99.12%
• Country: US
• Employees: 56
• Sector: Consumer Defensive
• Sector Strength: 50
• Industry: Tobacco
• EPS (TTM): -13.16
• Shares Outstanding: 3,513,872
• 10 Day Avg. Volume: 234,496
• 30 Day Avg. Volume: 1,887,649
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.62
• Enterprise Value/Revenue: 0.21
• Enterprise Value/Gross Profit: -1.33
• Enterprise Value/Ebitda: -0.35
• 1Y Price Target: $2.00
• Price Target Upside: 8.11% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 0

• Rating: 38 Underperform
• Price Target: $2.00 ▲(8.11% Upside)

22nd Century's overall stock score is primarily impacted by its weak financial performance, characterized by negative margins, high leverage, and cash flow challenges. Technical analysis also indicates a bearish trend, further weighing on the score. While there are strategic shifts and corporate developments that could improve future prospects, the current financial and market conditions present significant risks.

22nd Century Business Overview & Revenue Model

Company Description

22nd Century Group, Inc. (XXII) is a biotechnology company focused on the development of innovative solutions for the tobacco and hemp industries. The company specializes in genetic engineering and plant biotechnology, aiming to create low-nicotine tobacco products designed to reduce dependence on nicotine. Additionally, 22nd Century is involved in the production and commercialization of hemp-derived products, including cannabinoid extracts and related applications. The company operates primarily in the sectors of biotechnology, agriculture, and health.

How the Company Makes Money

22nd Century generates revenue through several key streams. Primarily, the company earns income from the sale of its proprietary low-nicotine tobacco products and related technologies to tobacco manufacturers. This includes licensing agreements and royalties from the use of its patented genetic modifications. Furthermore, 22nd Century has developed a portfolio of hemp-derived products, which contributes additional revenue through direct sales and partnerships with other companies in the hemp and cannabinoid markets. Significant partnerships with major tobacco companies and ongoing collaborations in research and development help bolster its revenue potential, alongside the company's focus on regulatory compliance and product innovation to meet market demands.

22nd Century Financial Statement Overview

Summary

22nd Century faces significant financial challenges, with declining revenues, negative profitability margins, and high leverage. The company's ability to generate cash is weak, and its financial stability is at risk due to high debt levels and negative equity returns. Strategic changes are necessary to improve operational efficiency and financial health.

Income Statement

The income statement shows significant challenges with negative margins across the board. The TTM gross profit margin is -15.94%, and the net profit margin is -80.22%, indicating substantial losses relative to revenue. Revenue has declined by 16.19% in the TTM period, reflecting a downward trend in sales. The EBIT and EBITDA margins are also negative, highlighting operational inefficiencies and high costs relative to revenue.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 0.96 in the TTM period, suggesting significant leverage. The return on equity is negative, indicating that the company is not generating profit from shareholders' equity. The equity ratio is low, showing limited equity financing relative to total assets, which could pose risks in financial stability.

Cash Flow

Cash flow analysis indicates negative operating and free cash flows, with a slight improvement in free cash flow growth but still negative at -8.55% in the TTM period. The operating cash flow to net income ratio is negative, suggesting that the company is not converting its net income into cash effectively. The free cash flow to net income ratio is slightly above 1, indicating that free cash flow is marginally covering net income losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	20.01M	11.88M	32.20M	40.50M	30.95M	28.11M
Gross Profit	-3.19M	-2.40M	-8.70M	1.85M	2.07M	1.44M
EBITDA	-12.04M	-12.11M	-40.41M	-32.89M	-31.00M	-18.07M
Net Income	-16.05M	-15.16M	-140.78M	-59.80M	-32.61M	-19.71M
Balance Sheet
Total Assets	22.38M	21.67M	27.50M	114.65M	75.95M	51.69M
Cash, Cash Equivalents and Short-Term Investments	3.08M	4.42M	2.06M	20.40M	48.74M	22.34M
Total Debt	5.43M	8.62M	16.38M	1.65M	2.34M	786.00K
Total Liabilities	16.75M	17.66M	35.91M	18.68M	9.88M	7.58M
Stockholders Equity	5.63M	4.01M	-8.41M	95.97M	66.07M	44.11M
Cash Flow
Free Cash Flow	-13.92M	-14.51M	-60.60M	-56.14M	-23.91M	-16.14M
Operating Cash Flow	-13.83M	-14.35M	-54.99M	-51.71M	-22.84M	-15.62M
Investing Cash Flow	582.00K	-139.00K	16.82M	22.58M	-27.73M	16.47M
Financing Cash Flow	15.05M	16.85M	37.21M	30.82M	50.88M	-304.00K

22nd Century Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.85
• 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 1.85 is below the 20-day moving average (MA) of 2.36, below the 50-day MA of 4.70, and below the 200-day MA of 76.38, indicating a bearish trend. The MACD of -0.91 indicates Negative momentum. The RSI at 21.39 is Positive, neither overbought nor oversold. The STOCH value of 4.81 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
UVV	73 Outperform	$1.37B	13.59	7.20%	5.92%	4.11%	-15.50%
TPB	70 Neutral	$1.78B	40.62	26.05%	0.29%	4.44%	-5.94%
Sector *	63 Neutral	$20.46B	14.51	-3.60%	3.15%	2.60%	-5.31%
ISPR	49 Neutral	$171.44M	―	-110.47%	―	-1.69%	-106.13%
XXII	38 Underperform	$6.82M	―	-616.13%	―	-49.46%	99.12%
GNLN	38 Underperform	$4.77M	―	-149.74%	―	-72.92%	85.19%
KAVL	31 Underperform	$9.69M	―	-88.92%	―	-86.91%	59.47%

22nd Century Corporate Events

22nd Century Approves Key Proposals at Annual Meeting

On July 15, 2025, 22nd Century Group, Inc. held its 2025 Annual Meeting of Stockholders, where several key proposals were approved. These included the election of two Class II directors, an increase in authorized shares of common stock to 500 million, amendments to the 2021 Omnibus Incentive Plan, and the appointment of Freed Maxick CPAs, P.C. as the company’s independent accountants for 2025. Additionally, stockholders approved measures related to executive compensation, reverse stock split, issuance of shares upon exercise of warrants, and amendments to convertible debentures, aligning with Nasdaq Listing Rules.

22nd Century Secures Exclusive Manufacturing Agreement

On June 23, 2025, 22nd Century Group entered into a Master Services Agreement with an existing customer to exclusively manufacture the customer’s Pinnacle cigarette and moist snuff brands for five years. This agreement includes the production of existing Pinnacle cigarette brands and the launch of new low nicotine and natural style brands, as well as moist snuff products. The company will pay royalties for each carton sold to distributors. This partnership expands 22nd Century’s market presence, leveraging the Pinnacle brand’s strong sales record in over 1,700 stores across 27 states, with new product sales expected to begin in late summer and early fall of 2025.

22nd Century Announces Reverse Stock Split Plan

On June 16, 2025, 22nd Century Group, Inc. filed a Certificate of Change in Nevada to authorize a 1-for-23 reverse stock split of its common stock. This move was aimed at restoring compliance with NASDAQ’s listing standards. The reverse stock split will take effect on June 20, 2025, and the company’s shares will trade under a new CUSIP number while retaining the same NASDAQ symbol ‘XXII’. The split will reduce the number of authorized and outstanding shares proportionally, with no fractional shares being issued. Stockholders’ percentage ownership and voting power remain largely unchanged, and all options and warrants will be adjusted accordingly.

22nd Century Modifies Securities Purchase Agreement

On May 22, 2025, 22nd Century Group, Inc. announced a modification to its Securities Purchase Agreement and debentures with JGB Partners and related entities, allowing for a potential reset of the Conversion Price, contingent upon stockholder approval. This move, aimed at financial restructuring, involves resetting the Conversion Price to the average of the daily VWAPs of the preceding five Nasdaq trading days, not exceeding the current $6.04, with $3.8M in Debentures outstanding. Additionally, Anthony Johnson, a Director of the Company, resigned effective July 15, 2025, with his departure unrelated to any conflicts with the company.