Cronos Group Inc

CRON: XTSE (CAN)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	CAD 6.60	Hbrn	Kvwszfn

Cronos Remains Far From Critical Mass to Achieve Profitability; Cash Hoard Is Most of Its Value

Kristoffer Inton

Sep 3, 2024

Business Strategy and Outlook

Cronos Group cultivates and sells cannabis predominantly in Canada and Israel. With 2023 net sales below CAD 100 million, it is the smallest Canadian licensed producer we cover by far. This hurts its ability to scale overhead expenses, leading us to forecast the company will not reach breakeven adjusted EBITDA profitability within our 10-year forecast. This leaves its equity value stemming from its cash hoard rather than from positive free cash flow generation.

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