Despite the troubles that most cannabis companies went through last year, some companies look well placed to rebound strongly in 2020, and one such company could be Cronos Group (TSX:CRON) (NASDAQ:CRON).
The company is all set to announce its fourth-quarter results and the full-year results for 2019 on February 27. The results are going to be declared before the opening of the markets, and hence, it could create a lot of excitement among investors tracking the stock.
Analysts believe that there could be a lot of positives for the company in the earnings call, and hence, it is perhaps necessary to take a closer look.
At this point in time, cannabis companies that have tied up with big-ticket firms are well-positioned to grow, and in that regard, Cronos group is covered. In 2018, tobacco giant Altria invested $1.8 billion in the company and picked up a 45% stake, and that partnership could well be the key to the company’s future.
Considering the fact that Altria’s investment in the e-cigarette company has cratered significantly, experts believe that the company could pour more money into Cronos in order to turn it into a winner.
On the other hand, analyst Rahul Sarugaser of the firm Raymond James has stated that there is much more to Cronos Group than what meets the eye. He mentioned that the company’s decision to move into the United States CBD space and its relationship with Altria is expected to be two important factors in Cronos’ growth. That being said, Sarugaser also stated that the company would only start showing benefits of cannabis derivatives legalization in the latter half of this year.
He went on to state that ‘strong, fiscally prudent’ cannabis companies are all set for a rebound this year, and Cronos is certainly one of those companies.
The company currently has $2 billion in cash reserves, and that could prove to be a major factor in its expansion this year. He gave the stock a buy rating and set the target price at $9.03, which reflects gains of 31% in 12 months. Sign-up below for continuing coverage on shares of $CRON stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!