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Analyzing Charlotte’s Web Holdings’ Q1 Earnings Estimates

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Charlotte’s Web Holdings

Charlotte’s Web Holdings (CWBHF) is scheduled to release its first-quarter earnings today and hold its earnings conference call tomorrow. Cresco Labs’ (CRLBF) first-quarter earnings are also expected tomorrow.

Charlotte’s Web released its preliminary results earlier this month. It expects to post revenue of $21 million–$22 million in the quarter, compared with $21.5 million in the fourth quarter and $13.5 million in the first quarter of 2018. The company expects adjusted EBITDA of $4.0 million–$4.5 million and net income of $2.0 million–$2.5 million, compared with $4.3 million and $3.2 million, respectively, in the prior quarter.

Notably, Charlotte’s Web is among the few cannabis companies with net income. However, the sector’s top-line growthhas been strong. For instance, in the first quarter, GW Pharmaceuticals (GWPH) revenue rose 1,200% year-over-year.

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Analysts’ estimates

Analysts expect Charlotte’s Web to report revenue, adjusted EBITDA, and net income of $22.7 million, $5.5 million, and $2.3 million, respectively, in the first quarter. Two analysts recommend “strong buy” for CWBHF stock, and five recommend “buy” or some equivalent. Their mean price target of 32.27 Canadian dollars implies a 66.8% upside from its May 24 closing price.

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