Everyone generally accepts that what goes up, eventually comes back. But the law of physics has nothing about the cannabis sector. The trend in the world of marijuana stocks has generally followed a slightly different pattern. When it comes to pot stocks, what goes up comes down and then falls again.
But every now and then – even in the cannabis sector – there is the exception that proves the rule. In this case, that exception might be Cresco Labs (OTC :), (CSE :).
Chicago-based marijuana grower goes his own way. In 2020 the share has risen about 31.5%. And the short term outlook is for more of the same.
Last week, Cresco Labs announced its results, further strengthening its inventory, with a one-day gain of about 8%. The company posted adjusted EBITDA of $ 46.3 million, well above double what analysts expected.
Revenues for the quarter were also impressive. They totaled $ 153.3 million, setting a new business record. The figure was about 63% higher than the previous quarter and represented the third consecutive quarter with sales growth of more than 40%.
Retail revenues were up 60% in the three month period ending September 30, reaching $ 62.8 million.
“Cresco Labs entered the third quarter with fireworks on all cylinders and achieved record levels in sales, profitability and cash flow. We remain the number one in the industry to focus on and deliver results in the wholesale distribution of branded products, ”said Charles Bachtell, co-founder and CEO of the company.
"Our retail business is performing better and we are generating significant operational leverage."
The company also posted strong results in its wholesale sales, generating $ 90 million in revenue.
After the results were released, Altacorp Capital increased the target price for Cresco Labs to $ 14. It had previously been $ 12.50.
Shares of Cresco Labs closed at $ 9.02 yesterday, a further 2.82% higher than that day.
Tilray Fails to Deliver Turnaround
Tilray, based in Canada (NASDAQ 🙂 continues to struggle, with a share drop after placing the latter earlier this month.
On November 9, the cannabis pharmaceutical company reported $ 51.41 million for the quarter, compared to analyst expectations of $ 54.91 million. Sales for the quarter were 0.6% higher than the same quarter last year. The news took the stock to just over $ 11 a share before investors pulled out.
Yesterday the stock closed at $ 6.68, down nearly 40% in the past two weeks. In the past year, Tilray's share has fallen more than 68.5%
What goes down sometimes keeps going down in the cannabis sector.
