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How Analysts View Cresco Labs before Its Q1 Release

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Nov. 20 2020, Updated 1:26 p.m. ET

Cresco Labs

Cresco Labs (CRLBF) is slated to release its first-quarter earnings on May 29. Analysts expect the company’s revenue to rise sequentially to $22.6 million from $16.9 million, and then rise to $33.7 million in the second quarter and $93.1 million in the third quarter.

Cresco’s revenue rose by 33% sequentially and an impressive 411% in the fourth quarter. GW Pharmaceuticals’ (GWPH) revenue also rose, by 13-fold, in its first quarter. To learn more, read Comparing GW Pharmaceuticals’ Returns to Peers.

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Analysts’ estimates

Cresco is expected to post a net loss of $4.2 million in the first quarter, compared with a net loss of $6.8 million in the quarter prior. However, the company is expected to see a net profit of $3.3 million in the second quarter. Whereas Village Farms (VFF) reported a net profit in the first quarter, Greenlane Holdings (GNLN) and Green Dutchman Holdings (TGOD) reported a loss.

Four analysts recommend “buy” for Cresco stock, and their mean price target of 20.25 Canadian dollars implies a ~40% upside from its May 25 closing price. Cresco has outperformed cannabis ETFs this year, rising 56.7%. The ETFMG Alternative Harvest ETF (MJ) has risen 34.1%. While cannabis ETFs are sitting on strong returns this year, they have seen a selling spree for the last four weeks amid a broader market sell-off.

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