Cresco Labs (CRLBF, Financial) has received a downgrade from Canaccord, which altered its recommendation to Speculative Buy from a previous Buy. The firm has also adjusted the price target for Cresco Labs, reducing it from C$2.50 to C$1.50. This change reflects revised expectations surrounding the company's performance and market conditions.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 1 analysts, the average target price for Cresco Labs Inc (CRLBF, Financial) is $3.00 with a high estimate of $3.00 and a low estimate of $3.00. The average target implies an upside of 400.00% from the current price of $0.60. More detailed estimate data can be found on the Cresco Labs Inc (CRLBF) Forecast page.
Based on the consensus recommendation from 8 brokerage firms, Cresco Labs Inc's (CRLBF, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Cresco Labs Inc (CRLBF, Financial) in one year is $1.41, suggesting a upside of 135% from the current price of $0.6. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Cresco Labs Inc (CRLBF) Summary page.
CRLBF Key Business Developments
Release Date: March 12, 2025
- Revenue: $724 million for the full year 2024, a 6% decline year-over-year.
- Adjusted Gross Profit: Held flat year-over-year despite revenue decline.
- Adjusted EBITDA: $200 million for 2024, a 15% improvement over 2023.
- Operating Cash Flow: $132 million for the full year, a $74 million improvement from the previous year.
- Q4 Revenue: $176 million, with retail revenue flat sequentially.
- Adjusted Gross Margin: Approximately 50% in Q4, down from the previous quarter.
- Adjusted SG&A: $54 million in Q4, a 1% year-over-year reduction.
- CapEx: $20 million for the full year 2024.
- Debt Reduction: Retired $40 million of the 2026 note in Q4.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Cresco Labs Inc (CRLBF, Financial) generated $724 million in revenue for 2024, maintaining adjusted gross profit dollars flat despite a slight year-over-year decline.
- The company improved its adjusted EBITDA by $26 million, reaching $200 million, and significantly increased operating cash flow by $74 million to $132 million.
- Cresco Labs Inc (CRLBF) maintained its number one market share position in key states like Illinois, Pennsylvania, and Massachusetts, and achieved share growth in Ohio.
- The company is strategically expanding its footprint by reinforcing core markets and entering new markets like Kentucky, which offers favorable regulatory structures.
- Cresco Labs Inc (CRLBF) demonstrated strong retail performance, with its dispensaries being 30% more productive than the average store in their markets.
Negative Points
- The company faced price compression in core markets, which limited its ability to fully capitalize on increased demand in Q4 2024.
- Wholesale revenue declined sequentially due to price compressions in Illinois and Pennsylvania, and supply constraints amplified pricing impact on revenue and margin.
- Cresco Labs Inc (CRLBF) anticipates near-term margin pressure as it ramps up production capacity in Illinois and Pennsylvania.
- The company is proactively limiting sales to customers with potential accounts receivable risk, which creates short-term headwinds.
- Cresco Labs Inc (CRLBF) expects continued pricing pressures and market fragmentation, particularly in Illinois, to weigh on revenue in the near term.
